Japan Tobacco International Cigarette Volume Down by 3.1%

Published on January 13th, 2016 00:00

Japan Tobacco International local cigarette sales volume in the course of the nine months to the end of September have declined by 3.1 % in comparison with 2014, 83.9 billion of the same period a year ago. In proclaiming its consolidated results, JT explained that volume sales had declined due to an industry-wide volume drop and simply because of increased level of competition in the sub-premium price segment.

Japan Tobacco International

Key local cigarette profit had dropped by 1.1 % (from ¥483.5 billion to ¥478.2 billion) due to the reduced sales volume, to some extent compensated by an enhanced price/mix effect, which primarily took place in the 1Q, and larger local sales of duty-free products. ‘In the framework of actions to strengthen the brand portfolio, two Seven Stars menthol products were presented to assist our development in the growing menthol segment,’ the company added. ‘This was in addition to the latest incorporation of the Caster and Cabin brands with Winston. ‘In extremely demanding competitive conditions, JT’s general share of market has continued to be stable at 59.9 % for the nine-month period.’ Within that total, global flagship brands shipment volume boosted by 5.7 % to 205.4 billion.

The increase in global flagship brands shipment volume was mostly pushed by the markets of the Benelux countries and those  from Canada, Czech Republic, France, Germany, Iran, Italy, Romania, South East Asia, Spain, Taiwan, Turkey and Ukraine. ‘Entire shipment volume decreased by just 0.4 %, mostly because of the Middle East and Russia, to some extent compensated by global flagship brands increase and advantageous trade inventory moves in Iran and Turkey, the company confirmed. ‘Market share persisted to develop in the majority of the major markets, specifically France, Italy, Spain, Taiwan, Turkey and the UK.’

Including the final results of its other businesses, JT’s January-September profit amplified by 0.7 % to ¥1,688.5 billion while its adjusted operating revenue dropped by 2.6 % to ¥510.3 billion. JT’s president and CEO, Mitsuomi Koizumi, reported that the company’s worldwide tobacco business had showed a strong performance, powered by higher global flagship brands shipment volume and considerable pricing benefits.