Japan Tobacco quarterly profit jumps
Japan Tobacco Inc. on Monday reported a 67% jump in net profit for the fiscal third quarter from a year earlier, when domestic tobacco sales were hit by a tax hike.
The world’s third-largest tobacco company by sales volume after Philip Morris International Inc. (PM) and British American Tobacco PLC (BTI), generated a net profit of Y64.5 billion in the October-December quarter from a Y38.6 billion profit in the same period a year earlier.
JT said revenue grew 23% to Y669.6 billion from Y542.6 billion the previous year. Operating profit rose 73% to Y116.8 billion from Y67.5 billion.
Tobacco sales in Japan have slumped since the tax hike came into effect Oct. 1, 2010. A temporary suspension of shipments of all JT cigarette brands last year due to a shortage of filters and other supplies after the March 11 earthquake and tsunami also hit sales.
But with the negative impact of the tax hike running its course over the previous 12 months, tobacco sales in volume in October soared 2.6 times, marking the first on-year gain in 13 months. Domestic tobacco sales also gained from the previous year in November and December, up 40% and 10%, respectively.
For the full business year ending March, JT raised its net profit outlook to Y189 billion from Y161 billion, citing an upward revision in the sales volume of the domestic tobacco business.
It revised upward its operating profit estimate to Y365 billion from Y329 billion. Revenue is now pegged at Y2.540 trillion, compared with Y2.497 trillion in the previous forecast.
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