Chewing tobacco
Chewing tobacco is sold primarily on the North American market, mainly in the southern US. Swedish Match is the leading producer of chewing tobacco in the US. Well known brands include Red Man and Southern Pride. The chewing tobacco segment shows a declining trend.
During the second quarter, sales increased by 39 percent, to 314 MSEK (227). In local currency, sales of chewing tobacco increased by 5 percent, as federal excise tax related restocking partially mitigated normal volume declines and price increases took effect. Operating profit increased by 67 percent, to 129 MSEK (77). In local currency, the operating profit increased by 26 percent. Operating margin was 41.0 percent (34.1).
Sales for the first six months amounted to 599 MSEK (437) while operating profit amounted to 227 MSEK (146). In local currency, sales for the first six months were up 3 percent, while operating profit grew by 17 percent. Operating margin was 38.0 percent (33.4).
During the second quarter, the Company began producing chewing tobacco as part of a production agreement with National Tobacco. Production will be fully up and running during the second half of the year.
