Scandinavian Tobacco Group (STG) will expand its branded handmade cigar business, Cigars International (CI), despite a fall in net sales attributed to the subsidiary, the company said in its third quarter results.

STG plans to open two CI retail stores in Texas next year to compliment the subsidiary’s online business and improve its performance. CEO Niels Frederiksen made the announcement, stating “I am pleased to see the steady progress in the quarter where we continued to focus on getting Cigars International back on track.”
STG’s reported net sales for the nine months to 30 September slipped 2.6 per cent to DKK 4.77 billion (EUR 641 million), with IT infrastructure troubles at CI cited as having adversely impacted the Group’s sales this year. The company said implementation of new IT infrastructure at CI resulted in negative organic growth of 4.6 per cent for handmade cigars, 3 per cent for machine-made cigars, 1.3 per cent for pipe tobacco and 7.9 per cent for fine cut tobacco.