Universal Leaf sales declined 3.5 per cent in the Richmond-based company’s second quarter, in part due to a reduction in leaf prices caused by oversupply and changes in the Brazilian market, the company said.

Universal took a charge of USD 49 million (EUR 36 million) in response to an antitrust fine levied by the European Union, the company said in an 8 Nov. statement. The charge wiped out profit in the three months ended 30 Sept. Universal's reported net loss of USD 8 million contrasts with a profit of nearly USD 52 million in the previous second quarter.
Deltafina, the Italian subsidiary against which the fine was levied, intends to appeal the ruling by the General Court of the European Union, Universal said..
Second-quarter revenue declined to USD 641 million from USD 664 million. Universal said revenues were lower because toll processing volumes replaced a portion of leaf sales to Philip Morris International as a result of the assignment of farmer contracts in Brazil last year.
"Despite the effects on current year earnings of the rejection of our European Commission fine appeal, we are doing well in a very difficult market. As the year is developing, the slow early season sales have been picking up.  Although it is too early to indicate a correction, selling activity began to accelerate in the second quarter of the fiscal year,” said George Freeman, Universal president and chief executive officer. (ci)