RAI 2008 3rd quarter - cigarette volume down, Conwood posts gains..

October 23, 2008 - Reynolds American Inc.'s (RAI) R.J. Reynolds Tobacco's 2008 third-quarter cigarette volumes declined by 7.5 per cent from those of the third quarter of 2007 and the company’s market share fell by 0.8 percentage points to 28.2 per cent. About 45 per cent of the third-quarter volume decline was said to have come from non-support brands, including some low-margin brands that were de-listed.

As a result of portfolio strategy change reclassified Kool as a support brand. R.J. Reynolds will focus on investment brands Camel and Pall Mall. The focus will be on building Camel's overall volume and share, and strengthening its position in the growing menthol category by driving growth of Camel menthol styles. Camel delivered modest 3rd quarter growth with retail cigarette market of 8.1% up 0.1 share points.
Pall Mall, the other growth brand, continued strong volume share growing in the 3rd quarter, with a retail share of 2.75, up 0.5 percent from the prior year quarter.

RAI smokeless company, Conwood posted another record quarter, with $98 million in operating profits. That's a 10 percent increase over last year's quarter, with Grizzly continuing to deliver double-digit growth. The moist snuff category is growing at an annual rate of more than 7 percent, and Grizzly continues to represent almost half of all category growth. Grizzly's 3rd quarter share of shipments was 23.4 percent, up 2.1 percentage points from the prior-year period. Contributing to the growth of Conwood's flagship brand was the strong performance of Grizzly's two newest styles - Grizzly Snuff and Grizzly Wintergreen Pouches which were both introduced nationally this year.

Again - no mention of Camel SNUS sales. As we know RAI plans to take SNUS nationally in 2009. It is claimed that Camel SNUS is playing a key role in creating awareness and educating smokers about this new category of smoke-free tobacco products. We know now that RJR sales people are sending cans to c-stores at no charge to pass out to anyone that wants them. It's been hard to finds people willing to take the free cans.

Reference: See RAI's Cuurrent News..

Related paper: STOP - the Proliferation of Flavored Tobacco Products..