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’s profit margin will continue to narrow as an increase in levies on cigarettes prompts some smokers to switch to the cheaper alternative, said Emma Ridley, finance director of the Colombo-based BAT unit. The company’s operating profit margin , the highest among listed Asian peers, narrowed to 64 percent in 2016 from 67 percent a year earlier in a cigarette market estimated at about $1.1 billion. The gap between the price of cigarettes and beedis, cheap tobacco wrapped in a coarse leaf, has widened after the government raised excise duties and slapped a 15 percent value-added tax last year. The lowest-priced offering sold by Ceylon Tobacco -- the only licensed manufacturer of cigarettes -- is about four times more expensive than leaf-rolled products, which are produced by a segment of the industry that’s relatively less regulated and has seen smaller increases in levies. “In 2017, we foresee the beedi industry capturing at least half the tobacco market, posing a serious threat to the legal cigarette industry,” said Ridley. “As the affordability of legally manufactured cigarettes continues to diminish, more consumers are expected to downgrade to this cheaper alternative.” Beedis accounted for about 44 percent of the total tobacco market last year, up from 20 percent in 2007, Ridley said. The share of smuggled cigarettes is expected to rise to about 8 percent this year from 2 percent in 2016, according to the company. The numbers for the market share shift being claimed for beedis are exaggerated, said Health Minister Rajitha Senaratne. The government is in discussions with farmers cultivating tobacco to wean them away from the crop, he said. Sri Lanka hasn’t seen any evidence of an increase in the market share of beedis as imports of tendu leaf haven’t climbed, said Palitha Abeykoon, chairman of the National Authority on Tobacco and Alcohol. Tighter regulations on the beedi segment are being considered, he said.
News Search | All News Topics > Tobacco Industry News Topics : By Country | By State ; Press Releases by Industry Channel > All Tobacco Industry Press Releases Philip Morris International Recognized as Global Leader for Corporate Action on Climate Change for the Third Year Running LAUSANNE, Switzerland--(BUSINESS WIRE)--Oct. 25, 2016-- Philip Morris International Inc. (“PMI”) (NYSE/Euronext Paris: PM) today is recognized as a global leader in its action on climate change. For the third consecutive year, the company is on the CDP’s ‘Climate A List’ for taking comprehensive action to reduce greenhouse gas emissions and mitigate climate change, and for its transparent disclosure process. CDP, formerly known as the Carbon Disclosure Project, is the leading international not-for-profit organization assessing the work of companies worldwide in the area of climate change. Thousands of businesses submit annual climate disclosures to CDP for independent assessment against its scoring methodology. PMI’s ranking places the company among the top 9% of corporations, known as “A Listers.” CDP’s Climate Change benchmark report is produced at the request of 827 investors with assets of US$100 trillion. Commenting on the results, PMI’s Head of Environmental Sustainability, Andy Harrop, said: “We’re very pleased to be included on the CDP A List again, and remain dedicated to playing our part in limiting global warming. Building on the reduction of 200,000 tons of CO2 since 2010 across our operations, and our continued action to promote sustainable tobacco production and environmental improvements across our value chain, next year we will announce a suite of new targets based directly on climate science.” “PMI encourages strong action on climate change and supported an ambitious outcome to COP21 in Paris last December. With the Paris Agreement now entering into force, we look forward to working with others in facing the challenges and opportunities of climate change mitigation and adaptation.” The Climate A List is released today in CDP’s report, Out of the starting blocks: Tracking progress on corporate climate action, which establishes the baseline for corporate climate action and recognizes that global corporations have started the transition towards a low-carbon economy, with some already capitalizing on the opportunities this affords.