Japan Tobacco reports 12.8% rise in Q1 revenues

JAPAN TOBACCO

09/05/2024 07:23

LONDON, May 9 (Reuters) - Cigarette maker Japan Tobacco
 2914.T  on Thursday reported a 12.8% rise in first-quarter
revenues at its cigarette business, boosted by foreign currency
effects and users buying more expensive cigarettes or
alternative products. 
    The maker of Benson & Hedges and Winston cigarettes said
revenues rose 6.6% on a constant currency basis. The unit's
adjusted operating profit was 3% higher, at 231.9 billion yen 
($1.49 billion). 
     
    WHY IT'S IMPORTANT 
    Cigarette makers' traditional businesses are under pressure
as a growing awareness of health risks and ever-stricter
regulation drive falling smoking rates in some markets. 
    Japan Tobacco's results show how, despite this, tobacco
companies can still make big profits by hiking prices, and as
other markets continue to grow. 
    The company and its rivals are also looking to grow revenues
from alternative products, such as vapes, as smoking rates
decline in some countries. 
    BY THE NUMBERS 
    - Core revenues at the cigarette business rose 12.8%, or
6.6% at constant currency, to 653.3 billion yen
    - Adjusted operating profit rose 3%, or 4.9% in constant
currency, to 239.1 billion yen
    - Total cigarette volumes fell 1.7%
    - Volumes of the company's smoking alternatives, such as
vapes, rose 25.2%, with revenues from this division up 17.7%
    - Volumes collapsed in some markets, including the United
Kingdom where they fell 16.1% in part due to tax increases,
Japan Tobacco said.
    - In others, they rose, including Italy and Turkey, up 12.5%
and 23.1% respectively 
    


($1 = 155.6900 yen)

 (Reporting by Emma Rumney
Editing by Tomasz Janowski)
 ((Emma.Rumney@thomsonreuters.com; +447391409253;))