Japan Tobacco Inc. (JT) has announced that it will be increasing investments in modified-risk products in the coming year, as domestic cigarette volume sales continue to decline, in its end of year financial report released Tuesday.

In the financial report, JT stated that although it experienced growth in the international tobacco market, domestic cigarette sales volume declined by 12.5 per cent since the end of December 2016 from 106.2 billion down to 92.9 billion units. JT cigarette sales volume is predicted to continue to decline by 16.5 per cent year-on-year in the 2018 consolidated forecast.
The company attributes this development “to cigarette industry volume contraction as result of the expansion of the Reduced-Risk Products category and a continued diminishing market trend”.
JT reported that the cigarette industry volume was down 12.9 per cent from the previous year as well. The financial report also showed that JT’s revenue of JPY 626.8 billion at the end of 2017 decreased by 8.4 per cent from the JPY 684.3 billion company revenue at the end of 2016.
JT’s cigarette market share, however, increased by 0.3 percentage points to 61.3 per cent, according to the report. JT’s revenue is expected to increase by 3.8 per cent by the end of 2018.
Masamichi Terabatake, president and CEO of the JT Group, commented on the end of 2017 financial results. He said, “In my first year as CEO, I will focus on ensuring success in the domestic tobacco business, an essential driver for our future growth. We will also continue to actively invest in both traditional tobacco and Reduced-Risk Products with the ambition to hold the No.1 market share position in Reduced-Risk Products in Japan by the end of 2020.”