Altadis Enjoys Strong First Half

Source from:  Aug 30, 2007 tr.itsmyiq.com 09/03/2007

Cigarette sales by Altadis during the first half of this year, at 58.9 billion, were up by 8.6 per cent on those of the first six months of 2006, 54.2 billion, while the value of those sales rose by 7.6 per cent from €819 million to €881 million. The increase in volumes was attributed mainly to better performances on the Russian market and those of the Middle East, while the increase in the value of those sales was put down to the increased volumes, higher prices in Spain and a good performance in Morocco. The value of Altadis' blond cigarette sales, which now account for 75 per cent of total sales, increased by 9.7 per cent from €605 million to €664 million. Blond cigarette sales grew in Morocco, the Middle East, Spain, Russia and France by 25.6 per cent, 24.1 per cent, 20.8 per cent, 11.4 per cent and 2.3 per cent respectively. Sales in Germany during the second quarter slowed the decline of the first quarter, but Altadis said that market trends were still weighing against the segments where its products were stronger. Volume sales of Altadis' key international blond brands, Gauloises, Fortuna and Gitanes, increased by 9.4 per cent while their value rose by 4.3 per cent. These brands jointly accounted for 47 per cent of the volume sales of blond cigarettes, 20.6 billion, and 56 per cent of their value, €375 million. At €413 million, cigar sales for the first half of this year were down by 8.2 per cent on those of the first six months of 2006, a drop that Altadis put down to 'the unfavourable exchange rate variation, the challenging market trends in the US and the very strong comparison base of 2006'. The US accounted for about 55 per cent of cigar sales, global Havana cigars for 17 per cent, and Europe for about 15 per cent. Good levels of sales in Spain and of Havana cigars were not enough to offset the reduction of US sales in the first quarter and the effects of the falling dollar. Sales of Altadis USA decreased by 4.5 per cent in dollars but by 11.7 per cent in euro to €226 million. Sales of Havana cigars increased by 6.8 per cent in dollars but in euro fell by 1.2 per cent to €69 million. Havana cigars were said to have performed very well in mature markets, such as Spain, Germany and Italy, and to have shown 'very encouraging' performances in emerging markets such as Russia, Asia-Pacific, Latin America and Morocco. In Europe, the Spanish cigar market recovered from a fall that occurred at the beginning of last year following the entry into force of regulations restricting retail distribution. Sales there were up 6.9 per cent to €39 million, though this was partly offset by a fall in sales in France from €28 million to €24 million. Tobacco distribution represented 47 per cent of Altadis' total logistic activities. Sales were up by 7.2 per cent from €278 to €298 million. General logistic activities were increased by 9.6 per cent from €311 million to €340 million. Meanwhile, group Ebitda increased by 7.2 per cent to €590 million, net income rose 27.2 per cent to €247 million, and earnings per share were up by 32.4 per cent to 97.7¢. Enditem