Category: Financial

PMI: Smokefree More Than Half of Income by 2025

Photo: PMI
Philip Morris International (PMI) wants smokefree products to account for more than half of its revenues by 2025, up from its earlier target range of 38-42 percent. The new goal was announced during PMI’s 2021 investor day on Feb. 10., a virtual event broadcast from the company’s operation’s center in Lausanne, Switzerland, during which senior management presented PMI’s business strategies and growth outlook.
The company shared its 2021 to 2023 targets, including net revenue and adjusted diluted earnings-per-share (EPS) compound annual organic growth of more than 5 percent and 9 percent, respectively, and 2023 heated tobacco unit shipment volume of 140 to 160 billion units.
PMI plans to launch IQOS ILUMA, the next generation of its IQOS heat-not-burn product featuring internal heating based on Smartcore induction technology, in the second half of 2021.
In addition, the company intends to launch IQOS VEEV, its MESH technology vapor product, in more than 20 markets this year. PMI expects to commercialize IQOS in a total of 100 markets by the end of 2025, from 64 markets at the end of 2020.
Also at the investor day, PMI announced its target of at least $1 billion in net revenues from “beyond nicotine” products in 2025.
With the right regulatory frameworks, dialogue and support from civil society, the company said cigarette sales can end within 10 to 15 years in many countries.
Andre Calantzopoulos
“In just five years, we have thoroughly transformed our company, building IQOS into a top-5 global nicotine brand—with nearly $7 billion in net revenues and over 17 million users across 64 markets—while maintaining our leadership position in the international cigarette category,” said PMI CEO Andre Calantzopoulos in a statement.
“We are now embarking on our next growth phase, further shifting to a better, more sustainable business by driving the development of the smokefree category and leveraging our leading commercial model, which places the consumer at the core, to switch more adult smokers to our smokefree products.”
“This next growth phase is underpinned by our unmatched portfolio of innovative products. We are very excited to announce the planned launch of IQOS ILUMA—the next generation of our IQOS heat-not-burn product featuring a new internal heating induction technology—during the second half of this year.”
“As outlined today, we are well positioned to deliver excellent top- and bottom-line growth, as well as strong shareholder returns. We now aim to be a majority smokefree product company by 2025, an important milestone toward our ambition to deliver a smokefree future, to the benefit of adults who would otherwise continue to smoke, society, the company and our shareholders.”
Philip Morris reaffirmed its full-year 2021 guidance for earnings per share in the range of $5.90 to $6.00. For the three-year period between 2021 and 2023, Philip Morris is guiding for net revenue and adjusted EPS compound annual growth of 5 percent to 9 percent. Cigarette volume is expected to decline in that period. Philip Morris stock has fallen 3.5 percent over the last year while the benchmark S&P 500 index SPX, -0.03 percent is up 16.7 percent for the period.
A transcript and slides of the Investor Day are available at www.pmi.com/2021InvestorDay. An archive of the webcast will be available until 5 pm ET on March 11, 2021.
February 10, 2021
Pyxus Releases Improved Quarterly Results

Pieter Sikkel (Photo: Pyxus International)
Pyxus International, parent to e-liquid manufacturer Purilum, announced results for its fiscal quarter ended Dec. 31, 2020.
Sales and other operating revenues were $379.6 million for the three months ended Dec. 31, 2020, up from $363.3 million for the three months ended Dec. 31, 2019.
Gross profit as a percent of sales increased to 16.5 percent for the three months ended Dec. 31, 2020, from 15.2 percent for three months ended Dec. 31, 2019.
Net loss improved 62.7 percent to $8.2 million for the three months ended Dec. 31, 2020.
Adjusted EBITDA improved 64.9 percent, to $39.9 million for the three months ended Dec. 31, 2020, from $24.2 million for the three months ended Dec. 31, 2019.
Inventory decreased 11.5 percent to $771.8 million as of Dec. 31, 2020.
“Fiscal year 2021 continues to be a year of evolution for our business,” said Pieter Sikkel, Pyxus’ president and CEO, in a statement. “Since the completion of our financial restructuring, we have undergone a strategic review of all business units and categories in which we operate in order to develop a stronger, more streamlined strategy to improve financial performance.”
The developments in the e-liquids category following the September 2020 PMTA submission deadline, paired with increased enforcement of PMTA regulation, provide an encouraging opportunity for potential future growth.”
In January, Pyxus International announced plans to divest its cannabis business in order to focus on its more profitable tobacco and e-liquid businesses.
Despite recent challenges, the company continues to manage its working capital closely, according to Sikkel. “At Dec. 31, 2020, inventory decreased $100.1 million, or 11.5 percent, to $771.8 million when compared to Dec. 31, 2019,” he said. “Additionally, we expect our uncommitted inventory to be near the midpoint of our stated range of $50 [million] to $150 million by fiscal year end.”
February 10, 2021
TPB Announces $250 Million Private Offering

Photo: Tobacco Reporter achive
Turning Point Brands (TPB) announced the proposed private offering of $250 million aggregate principal amount of its senior secured notes due 2026. The notes will bear cash interest semi-annually beginning in 2021. The notes will be TPB’s senior secured obligations and will be guaranteed on a senior secured basis by each of TPB’s wholly owned domestic subsidiaries (except for certain specified subsidiaries).
TPB intends to use the proceeds from the offering to repay all obligations under and terminate its existing term loan and revolving credit facility; to pay related fees, costs and expenses; and for general corporate purposes. The offering is subject to market conditions.
TPB also announced that in connection with the offering, it intends to enter into a new $25 million senior secured revolving credit facility. The offering is not conditioned on the entry into the revolving credit facility.
In connection with its proposed offering, TPB announced certain preliminary operating results for the fourth quarter and full year ended Dec. 31, 2020.
TPB estimates that for the fourth quarter of 2020 net sales will be between $103.5 million and $105.5 million, income before taxes will be between $16 million and $17 million and adjusted EBITDA will be between $25 million and $26 million. Each of net sales and adjusted EBITDA will be near or above the high end of TPB’s previously disclosed guidance for the fourth quarter of 2020. TPB plans to release its full year end 2020 financial results on Feb. 10, 2021.
The company will hold a conference call to review fourth quarter and fiscal year 2020 results on Feb. 10.
February 2, 2021
U.K. Vapor Maker Supreme Raises GBP68 Million In IPO
In its initial public stock offering, Supreme, a maker of fast-moving consumer goods such as vaping brand 88Vape, announced the pricing for its initial public offering in London, joining a rush to market early in the new year.
Credit: 88Vape

Supreme is listing on AIM and expects to start trading today.
Supreme said it has placed 5.0 million shares at 134 pence each to raise GBP67.5 million. Of this, GBP60.0 million is for selling shareholders, and GBP7.5 million from new shares for the company, which it said will be used to pay off debt, according to Alliance News. The selling shareholders include Sandy Chadha, the founder and chief executive officer, who will retain a 56.8 percent stake, leaving a 43 percent free float.
Supreme will have a GBP156.1 million market capitalisation at its IPO price. Supreme’s IPO is part of a flurry of new listing activity in London early in the 2021. These have been headlined by large-size floats by bootmaker Dr Martens and card seller Moonpig. Also planning IPOs are miner Cornish Metals Inc, investment fund Cordiant Digital Infrastructure Ltd, and life sciences company 4basebio UK Societas.
Not yet confirmed for London, but potentially biggest by far, is food delivery firm Deliveroo, which is expected to have a market cap of more than $7 billion. Deliveroo also is considering a New York listing, according to media reports.
Supreme supplies products across five target categories: batteries, lighting, vaping, sports nutrition & wellness, and branded household consumer goods. In addition to brands it owns, such as 88Vape, Supreme licenses major battery brands Duracell, Energizer and Eveready. Its customers include Fraser Group PLC’s Sports Direct, motor supplies chain Halfords Group PLC, and grocers Asda and Iceland.
Supreme recording adjusted earnings before interest, tax, depreciation and amortisation of GBP16.2 million on revenue of GBP92.3 million in the financial year that ended March 31 last year. In the six months to September 30 last year, Ebitda was GBP8.4 million on revenue of GBP56.3 million.
The company said it plans to pay dividends at a rate of 50 percent of net profit. “I am deeply proud of the business we have developed and believe our flotation on AIM will provide Supreme with the tools with which to capitalise on a number of exciting growth opportunities,” said CEO Chadha. “We have created a profitable business of significant scale, underpinned by a platform which provides a seamless route to market for a number of leading brands and product categories.”
February 1, 2021
RELX More Than Doubles Value in Opening IPO
Chinese e-cigarette maker RLX Technology, parent to the RELX brand, jumped 146 percent in its trading debut after raising $1.4 billion in its U.S. initial public offering.
Creit: RELX
RLX Technology’s American depositary shares closed at $29.51 Friday, giving the company a market value of about $46 billion. Backed by Sequoia Capital China, the company sold 116.5 million shares for $12 a piece on Thursday after marketing them for $8 to $10.
The IPO was led by Citigroup Inc. and China Renaissance Holdings Ltd. The company’s ADS, each representing one ordinary share, are trading on the New York Stock Exchange under the symbol RLX.
The IPO, the first major U.S. listing this year by a China-based company, signals continuing investor demand, according to Bloomberg.
RLX, founded in 2018, is China’s largest e-cigarette maker with 62.6 percent of the country’s market, according to a report by China Insights Consultancy cited in the company’s IPO prospectus.
China is the world’s largest potential vaping market, with an estimated 286.7 million adult smokers in 2019, RLX said in its prospectus. But vaping products only have a 1.2 percent penetration rate, compared with 32.4 percent in the U.S.
January 25, 2021
E-Liquid Maker Plans to Join London Junior Stock Market
Supreme, the manufacturer of multiple e-liquid brands, is considering a stock market listing that could value it at £180 million. The Manchester-based company that produces the Kik and 88vape brands is seeking to join Aim, London’s junior market, and has started to gauge investor interest.
Credit: 88vape
Supreme attempted a flotation in 2018 but abandoned the listing, blaming market conditions, according to an article on Morningstar. Then, the company announced plans for an AIM float but less than two weeks later postponed its proposed IPO due to “market conditions” and despite “encouraging” institutional support for the listing.
Alongside its e-liquids products, the company, the company also sells sports nutrition products, batteries and lightbulbs. It is owned by Sandy Chadha. It sells directly to retailers and wholesalers but also has its own online platform.
The company did not disclose how much it plans to raise in connection to the float, nor did it outline an estimated market capitalisation on admission.
January 20, 2021
RLX Technology Seeks up to $1.17 Billion From IPO Offer

Photo: Tobacco Reporter archive
RLX Technology is looking to raise as much as $1.17 billion from a U.S. initial public offering, reports Bloomberg.
The Chinese vapor company, known for its RELX-branded devices in China, had earlier considered Hong Kong as a listing venue, but it ultimately opted for the U.S.
Founded in 2018, RLX is China’s largest e-cigarette maker. The vaping industry has boomed in China even as the country banned online sales of e-cigarettes just over a year ago. The company said it plans to file a premarket tobacco product application (PMTA) with the U.S. Food and Drug Administration (FDA) to legally sell its products in the world’s largest vapor market.
China is the world’s largest potential vaping market, with an estimated 286.7 million adult smokers in 2019, RLX said in its prospectus. But vaping products only have a 1.2 percent penetration rate, compared with 32.4 percent in the U.S.
RLX’s revenues increased to CNY2.2 billion ($340 million) in the first nine months of 2020 from CNY1.14 billion a year earlier. It started turning a profit in 2019 and recorded net income of CNY109 million in the nine months to Sept. 2020.
The company plans to price the IPO on Jan. 20 after the U.S. market closes, according to a term sheet. Citigroup and China Renaissance are joint bookrunners for the offering.
Earlier reports suggested the company planned to raise up to $100 million in its IPO.
January 19, 2021
Blinc Group Raises $1.5 Million in Bridge Funding
The Blinc Group has successfully raised a $1.5 million in bridge funding until its next round of funding, Series A. The financing of was led by Equitas Partners Fund, WGD Capital, LP, and 7thirty Capital.
Credit: Pasja1000
“The Blinc Group puts quality and safety at the forefront of its vape technology and since day one, that dedication to the highest standards has brought us the endorsement of institutional investors focused on the cannabis industry,” said Arnaud Dumas de Rauly, CEO and co-founder of the Blinc Group. “Our team navigated 2019’s vape crisis helping set standards and advise regulators on testing and compliance, and last year the company saw our best quarter yet amid the COVID-19 pandemic as the industry learned the benefits of safety and traceability. We have shown that we are a resilient company that puts consumers first, which has made all the difference.”
In 2020, Blinc Group, a regulatory-focused designer and provider of premium, customized and bespoke vaporizer technologies, more than tripled its orders with over 330 percent YOY growth, showcasing the technology company’s ability to scale and flourish in a difficult regulatory landscape, according to a press release.
Dumas de Rauly attributes much of the company’s success to the emphasis it placed on safety, compliance throughout the vape crisis of 2019 and the Coronavirus pandemic. The company has serves clients around the globe including Canadian heavyweights because of its unique ability to meet Health Canada’s rigorous standards.
Arnaud Dumas de Rauly
“We began underwriting our initial investment in Blinc near the onset of the so-called vape crisis in 2019 and it became quickly apparent that the team’s experience within the vape technology space and its focus on quality, traceability and customer service would see them through and enable them to emerge as a market leader,” said Andi Goldman, Managing Member and co-founder of the Equitas Partners Fund. “While others turned more attention towards safer vaping products after the crisis, safety had always been a major pillar of Blinc’s products and part of its DNA, which attracted us as investors and gave us confidence that they would be able to substantially expand their business into Canada and elsewhere.”
The Blinc Group has also stayed ahead of the industry in part due to its strong ties in Shenzhen, China, and employing a manufacturing line dedicated to their products, which helped eliminate hiccups in the supply chain, according to the release. The Company’s China-based team is the backbone of Blinc’s “Powered By Blinc” offering, a certified product manufactured to the highest international standards of safety and compliance with complete quality control and full traceability of the product, process, and each sub-component across the entire supply chain.
“We have watched the Blinc team over the past few years as they have grown their business and dedicated their focus to safety and traceablity within the vape hardware sector. Blinc’s reputation for putting these important factors first has secured customer wins with some of the leading cannabis operators in North America”, said Michael Mitgang, managing director and Co- Founder of the WGD Opportunity Fund.
Proceeds from this financing will go towards expanding Blinc’s sales team, opening an office in Toronto, as well as expanding the team in Shenzhen, and the research and development of new innovative materials and vape technologies.
“The vape category is one of the primary revenue drivers in every market and satisfies the demands of some of the most committed cannabis consumers. Providing high-quality products is a must for any brand looking to win and retain loyal shoppers,” said 7thirty’s director of Research, Ben Richardson “The Blinc Group’s focus on vape safety and compliance, in addition to CEO Arnaud Dumas de Rauly’s leadership roles with International and European committees on vaping products, position the Company as a leading voice in this fast-growing category.”
In 2020, The Blinc Group worked closely with Colorado’s Science & Policy Committee on the adoption of new testing standards for the emissions from vape devices. This kind of work is just one example of the dedication that the Blinc Group team puts on aligning the cannabis industry with best practices for the safest products possible.
The Blinc Group also received additional funding from the Arcview Collective Fund and the Panther Opportunity Fund.
January 16, 2021
RELX Files With SEC For $100 Million U.S. Stock Sale
RLX Technology, parent to the RELX brand of vaping products, has filed with the Security Exchange Commission (SEC) in the U.S. to raise up to $100 million in an initial public offering (IPO).
Credit: RELX Technology
The $100 million request is well below the $1 billion the company said it expected to raise when it announced Citigroup as the bank of record for its planned initial public offering in the U.S., people with knowledge of the matter said.
The Shenzhen-based company, which counts Sequoia Capital among its backers, boasts a 62.6 percent market share in China for closed-system vaping products in terms of retail sales, according to a press release.
“The company has partnered with 110 authorized distributors to supply its products to over 5,000 RELX Branded Partner Stores, and over 100,000 other retail outlets nationwide, covering over 250 cities in China,” the release states.
Revenue for the company nearly doubled in the nine months ended September 30, 2020 to $324 million, with net income of $16 million.
The Beijing, China-based company was founded in 2018 and booked $400 million in sales for the 12 months ended September 30, 2020. It plans to list on the NYSE under the symbol RLX. RLX Technology filed confidentially on October 26, 2020. Citi is the sole bookrunner on the deal. No pricing terms were disclosed.
January 5, 2021
Relx Technology Chooses Citigroup for U.S. Share Sale
Chinese e-cigarette maker Relx Technology has picked Citigroup Inc. for its planned initial public offering in the U.S., people with knowledge of the matter said.
Credit: RELX
The Shenzhen-based company, which counts Sequoia Capital among its backers, is seeking to raise as much as $1 billion in a share sale next year, said the people, who asked not to be identified as the information is private. Relx Technology may add more banks at a later stage, according to one of the people, according to an article in Bloomberg.
Deliberations for the potential IPO are at an early stage, and details such as size and timing may change, the people said. A representative for Citigroup declined to comment. A spokesperson for Relx Technology said “the market rumors are not true,” without elaborating.
Chinese companies are choosing to list in the U.S. at a rapid pace despite Congress approving legislation that could force firms to withdraw from American exchanges in a dispute over audit inspection rules. Mainland and Hong Kong firms have raised $14.8 billion through U.S. initial public offerings this year, the second-best year on record, data compiled by Bloomberg show.
The IPO plan comes on the heels of fellow e-cigarette device maker Smoore International Holdings Ltd.’s much sought-after Hong Kong debut share sale. Smoore raised HK$8.19 billion ($1.06 billion) in July after pricing its IPO at the top end of a marketed range. The share price has soared more than 300%.
December 15, 2020