Steady revenue and profit growth driven by strong price/mix in the International Tobacco Business and the depreciation of the Japanese Yen, showing steady progress towards the full year forecast.
Full year forecast for adjusted EBITDA at constant rates of exchange remains unchanged, to grow 6.1% from the previous fiscal year.
Results for the 6 months
Revenue and adjusted EBITDA grew strongly by 9.6% and 13.0% respectively due to strong price/mix in the International Tobacco Business and the depreciation of the Japanese Yen. Adjusted EBITDA at constant rates of exchange increased 0.7%. Profit attributable to owners of the parent increased 40.5% due to gains from non-current asset disposals in addition to higher adjusted EBITDA.
International Tobacco Business: At constant rates of exchange , adjusted EBITDA and core revenue in US dollars grew 7.0% and 4.1%, respectively, driven by strong price/mix which more than compensated for overall volume decline. Total and GFB shipment volume decreased 5.1% and 2.3%, respectively, mainly due to continued industry contraction and one-off trade inventory adjustments in the first quarter. Market share continued to grow in most key markets.
Japanese Domestic Tobacco Business: Mevius continued to show steady market share growth following a number of new product and sales promotion initiatives in the growing menthol segment, driving an overall market share increase. As a result, total sales volume and core revenue remained flat, while industry volume declined. Adjusted EBITDA slightly declined 0.6%. Underlying performance is on track towards the full year forecast.
Forecast for FY2013
The forecast for adjusted EBITDA at constant rates of exchange remains unchanged at 6.1% growth year-on-year. On a reported basis, the adjusted EBITDA forecast has been revised upwards due to a revised exchange rate assumption for the Japanese Yen. The operating profit forecast has been also revised upwards as a result of the revised exchange rate assumption and higher gains from non-current asset disposals. The forecast for profit attributable to owners of the parent remains unchanged.
Mitsuomi Koizumi, President and Chief Executive Officer of JT, commented:
“Internationally, despite the challenging environment, we continued to grow share in most key markets. We are confident we will continue to deliver double-digit full year earnings growth on a constant currency basis. In Japan, several product and marketing initiatives have been taken to further strengthen the brand equity of Mevius, leading to higher overall share of market. The overall results of the first two quarters indicate that we are on track to achieve our full year targets.”