Japan Tobacco Inc. (JT) has released its second quarter results for 2022, with a 14.8 per cent increase in revenue to JPY 685.3 billion (USD 92.7 billion) compared to the previous year, according to a company press release.
According to the press release, revenue increased by 14.8 per cent JPY 685.3 billion (USD 92.7 billion) driven by increases across all businesses. Compared to the year’s first quarter, adjusted operating profit at constant currency increased 22.1 per cent to JPY 220 billion (USD 29.8 billion) driven by increases in the tobacco and pharmaceutical businesses, whereas the company profit increased by 25.6 per cent to JPY 140 billion (USD 18.9 billion) partially offset by increasing financing costs.
For the tobacco business, core revenue and adjusted operating profit increased by 16.1 per cent and 19.6 per cent respectively, driven by a solid pricing contribution from all clusters, continued market share gains and favourable currency movements.
Total volume decreased by 1.8 per cent, due to declines in the Asia and Western Europe clusters, partially offset by continued growth in the EMA cluster, mainly in Global Travel Retail, Iran, Poland and Turkey. Combustibles volume declined by 2 per cent, mainly due to industry volume contraction in the key markets of Italy, Japan, the Philippines, Russia and the UK. Market share gains continued in the key markets of Italy, the Philippines, Spain, Taiwan and Turkey. In the RRP category, volume grew by 13.6 per cent driven by the on-going Ploom X HTS (heated tobacco sticks) share gains in Japan, in an increasing segment.
Masamichi Terabatake, President and Chief Executive Officer of the JT Group, said in a statement:
“I would like to start by reiterating that the safety of our employees and their families remains our top priority. We are extending all possible support to affected people in Ukraine.
“In the first half, the JT Group delivered a robust performance, mainly driven by strong pricing. We are also encouraged by the Ploom X volume and share performance in Japan. In the second half of the year, we will be leveraging learnings from Japan for international Ploom X launches.
“We have revised our 2022 full year reported adjusted operating profit and profit guidance upwards, driven by favourable currency movements against the Japanese yen. However, the adjusted operating profit at constant FX is revised downwards considering higher input costs impacting our supply chain operations. Dividend per share guidance for full year remains unchanged at 150 yen per share. The interim dividend is 75 yen per share.
“Regarding Russia, while we continue to manufacture and distribute our products in full compliance with national and international sanctions, the operating environment is becoming increasingly complex. Under these circumstances, the JT Group continues to evaluate various options for its Russia business, including potentially transferring its ownership, and taking necessary decisions to address the changing situation in accordance with the Group’s management principle, which is to pursue the 4S model.”