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Summary
- Marlboro cigarettes would not be available in England within ten years, CEO of its maker Phillip Morris International Jacek Olczak said.
- Olczak said non-smoking alternatives with the right information and rules can replace cigarettes in some countries within 10 years from now.
Marlboro cigarettes would not be available in England within ten years, CEO of its maker Phillip Morris International Jacek Olczak said. In a mail, Olczak said that he would want a world without cigarettes, and it would be better for everyone if it happens as soon as possible. Petrol cars, due for the ban from 2030, and cigarettes should be treated, similarly he said.
He said that the UK could solve the smoking problem in ten years and if people did not stop smoking, the other alternative would be to move to less harmful alternatives.
In an interview to the Sunday Telegraph, Olczak has reportedly said those who think that alternatives to cigarettes are worse than smoking can be won over only through government action. He said that non-smoking alternatives with the right information and rules can replace cigarettes in some countries within 10 years from now, and the problem could be tackled once and for all.
Phillip Morris in July made a £1.05 billion-bid for Vectura, the British pharmaceutical company that makes asthma inhalers. It also said that it aims to get half its turnover from non-smoking products by transitioning into a healthcare company. Executive pay would be tied to the mission to phase out cigarettes in order to unsmoke the world.
Here is a look at two FTSE-listed tobacco stocks and how they reacted to the announcement:
British American Tobacco (LON: BATS)
The shares of the seller and manufacturers of cigarettes have a market capitalisation of £63,538.24 million. They have a year-to-date return of 2.25 per cent. The shares have a price-to-earnings (PE) ratio of 8.32x and a dividend yield of 7.60 per cent.
British American Tobacco shares were down 0.34 per cent and were trading at GBX 2,759 on 26 July at 08:05 GMT+1.
In a trading update, the company for FY 2021 said that it expects revenue growth of 5 per cent, which was above its earlier guidance of three to five per cent. The growth would be primarily driven by non-combustible product consumers increasing 1.4 million to 14.9 million in Q1, as its New Category products expanded to 74 markets across 53 countries. New Category products to continue gaining market share.
Imperial Brands Plc (LON: IMB)
The shares of the multinational tobacco company have a market capitalisation of £14,849.14 and have a one-year return of 12.43 per cent. The shares have a PE ratio of 6.17x and a dividend yield of 8.78 per cent.
Imperial Brands shares were down 0.70 per cent and were trading at GBX 1,558 on 26 July at 08:05 GMT+1.
For the six months ended 31 March, the company’s revenue was up 6.1 per cent to £15,568 million from £14,672 million in the same period a year ago. Operating profit was up 77 per cent to £1,637 million from £925 million a year ago. The company’s organic tobacco volumes were down 3.3 per cent as weaker volumes from duty-free segment partially offset consumer demand along with a slashing of US inventories due to robust wholesaler purchases in March last year.
