Tag Archives: R.J. Reynolds
Major rivals likely to follow PM USA steps shortly
Philip Morris USA, the leading cigarette maker in the USA, owned by Altria Group, is set to complete a six cent price increase per pack of all of its cigarette brands, the second time the tobacco giant has raised its price list this year, reported Dow Jones.
In its quest to keep on sales growth of its top-selling Pall Mall brand of cigarettes, RJ Reynolds is releasing the brand new menthol-flavored varieties.
The second-largest tobacco company in the U.S. has introduced Pall Mall White and Pall Mall Black as support version for Pall Mall Green, its iconic menthol style.
Richard Smith, communications manager for RJ Reynolds declared the black style gives smokers “a full-flavor smoke,” while the white style “provides a milder smoke.”
Smith mentioned that the latest are launched in the tobacco shops throughout the nation, with countrywide release planned for October.
In accordance with RJ Reynolds, the latest menthol-flavored styles are released to live up to the changing preferences of adult smokers and make the most of the momentum in the menthol segment of the market.
“We think Pall Mall grew to be the proper product launched at the proper time, due to the fact the tough economy continues to post a negative impact on purchasing capability of adult tobacco consumers,” Smith added.
Federal court of Appeals upheld a ruling prohibiting the federal government from obliging cigarette manufacturers to place grievous health warning labels on cigarette packs depicting severe health complications associated with smoking.
Last Friday, the U.S. Court of Appeals confirmed the previous decision that federal government’s requirement violates commercial free speech protection, granted by the First Amendment, with a 2-1 vote. The court dismissed the requirement and requested that the Food and Drug Administration draft new warnings.
Several of the nation’s leading tobacco groups, led by R.J. Reynolds Tobacco Co., contested the requirement to modify health warnings to depict the health risks related to smoking and promote smoking cessation. The companies argued that the new warnings overstepped factual information turning into anti-smoking banners. The FDA claimed that images of dead corpse and rotten teeth and gums are factual.
The nine health warning labels developed by the FDA encompass image of a man exhaling tobacco smoke using a hole in the throat, and other grueling, scary images, which accompanied by statements saying that smoking results in cancer and other diseases. The labels were set to cover a half of pack, and provide the Quitline number.
The court ruled that the case gives raise to “unexplored questions about the frames of the federal government’s authority to oblige the maker of a product to step over from providing only factual and precise commercial information and undermine its own commercial interest – in the given case, by turning ‘every cigarette pack selling across the country into billboard’ for the federal government’s anti-smoking advertisements.”
Reynolds Cigarette Company, the world’s second largest cigarette company, declared these days that its 3Q profit dropped about 4%.
But the manufacturer of Camel and Pall Mall cigarette brands announced that its earnings except those products raised approximately 4% as higher prices, increase in efficiency and selling more of its smokeless brands like Grizzly and Kodiak postpone cigarette volume decreases.
Lately, the major cigarette makers in international tobacco industry, including Philip Morris International, British American Tobacco and Japan Tobacco International are looking on the innovative menthol capsule technology to boost the sales of their tobacco products.
Japan Tobacco International adds new menthol Pianissimo to the brand family
JTI, the third-leading tobacco company in the world, is launching the brand new version of its popular Pianissimo brand. The latest addition, named Pianissimo ViV Menthol is equipped with “Breath Sparkling Shot”, which is a capsule filled with menthol and mounted in the filters. The new product will be selling from November.
The capsule, an innovative technology, developed by Reynolds American, gives adult smokers a chance to enjoy refreshing menthol taste, while smoking a full-flavored cigarette, by simply breaking the capsule, whenever they want to, said JT spokesman.
In addition, according to JTI press release, “Breath Sparkling Shot” also provides smokers with a more delicious aftertaste instead of the soul taste of harsh tobacco after smoking.
The Japan Tobacco International spokesman said that the name for their new product, ViV (shortened from “vivid”) and its packs will transmit the idea of fun and playfulness of the squeezing menthol capsules.
RJ Reynolds introduces new version of landmark Camel Crush
RJ Reynolds Tobacco, cigarette-making unit of Reynolds American revealed new version of innovative Camel Crush brand, launching a full-flavor cigarette with the revolutionary menthol capsule that is squeezed anytime an adult smoker is willing to.
According to several experts Lorillard has become a takeover target for tobacco industry tycoon R.J. Reynolds due to the emerging popularity of its cigarette brands – Newport and Kent. It also has appeared to be a major object of interest since it is a less than expensive stock that might be traded up to 30% higher.
Lorillard Tobacco Company is listed in the Top 20 of the oldest US companies. It is also the oldest cigarette manufacturer in the United States. Lorillard is the third biggest American tobacco company behind Philip Morris and R. J. Reynolds. Although it produces a rather large variety of cigarette brands like Maverick, True, Old Gold, Kent, Satin, and others, the company is world-famous for its leading brand – Newport, which has been the best selling menthol cigarette during two years.
Lorillard Tobacco Company is a bright example of a one-brand company; hence its market value comprises more than $10B. Although it is smaller than main rivals, this company owns an absolutely astonishing net profit margin of over $1B and has no debts. Moreover, the revenues are supposed to reach a 7% raise this year. Despite the Americans tend to give up smoking, Lorillard earned almost 3% more last year in comparison with a 3% decline for the tobacco industry as a whole.
Lorillard best brand Newport makes a 7,8% share of the American cigarettes market, being the number two in the list of best selling cigarette brands behind Philip Morris’s Marlboro.
Many investors consider that Lorillard is heavily underestimated on Wall Street. It is also rumored that R. J. Reynolds has started private negotiations with Carolina Group, the owner of Lorillard, attempting to purchase Lorillard for a much more considerable price than its actual $62/ share. Should Reynolds succeed in their attempt, they would become the largest tobacco company in the world, leaving Imperial Tobacco and Philip Morris International behind them.
However, it is still unclear if a Reynolds/Lorillard merger would be approved by antitrust legislation. Hence, experts remind about the Miller/Coors combo that contributed to the birth of a monopoly at the beer market duopoly but managed to go through the antitrust review.
Peter Edelman, a BNP Paribas expert admitted that Lorillard is the simply the best tobacco company in the world. He stated that it should have an $80 share, since they are simply undervalued by the Wall Street.
According to several other analysts, if Reynolds succeeds in the purchase of Lorillard it would be the most outrageous deals from both financial and strategic points of view.
Yet, there is only one but enormous obstacle, namely the law introduced to the Congress. If the law would be endorsed, the Food and Drug Administration would obtain the right to regulate the cigarette industry. It could lead to imposing a ban on menthol cigarettes. However, this situation seems rather unbelievable since it has been scientifically proven that menthol-flavored cigarettes provide maximum the same health complications as regular-tasted cigarettes.