Tobacco sales in Romania saw an increase of approximately 7.5 percent in 2014, according to a RisCo.ro study. Data shows that 95 percent of total sales in the industry is made up by the top three tobacco companies, JT International (JTI), British American Tobacco (BAT) and Philip Morris.
Though a recent study by the World Health Organization placed Romania among the countries with the highest tobacco taxes globally, profitability in the sector remains obvious when looking at the main tobacco companies’ turnovers and profits.
In 2014, JTI was market leader in Romania. JTI operates under two companies locally: JT International Romania SRL and JT International Manufacturing SA. In 2014 JT International Manufacturing posted a turnover of RON 545.2 million (EUR 123.26 million), which was up by RON 44.9 million against 2013. Their net profit in 2014 amounted to RON 24.1 million (EUR 5.47 million) after the previous year it posted no profit.
JT International Romania posted a RON 2.9 million turnover (against RON 2.7 million the previous year) and a RON 59.2 million profit (against RON 38.2 million the previous year).
Next, according to turnover, is BAT Romania Investments, with RON 179.1 million (EUR 40.49 million) in earnings, RON 2.3 million lower than the one in 2013. It registered a net profit of RON 3.5 million.
Philip Morris had a net profit of RON 20.7 million and registered RON 165.9 million (EUR 37.51 million) turnover, presenting increases against 2013 in both numbers (turnover up by RON 18.5 million, while profit increased by RON 2.8 million).
The study predicts an increase of 5 to 10 percent in cigarette consumption in 2015 against 2014 and no major changes in the ranking of market leaders.
The ranking was based on the turnover for the years 2014 and 2013 of companies working in the manufacture of tobacco products (in our case JT International Manufacturing SA, BAT Investments Romania and PMI Romania SRL).
Multinational companies operating in the tobacco industry in Romania own different companies through which specific activities are carried out in our country (production of cigarettes and tobacco products, distribution, investment, etc).
For this reason, the consolidated turnover for each entity, as they are reported to the shareholders and international management, contain other values than those presented in this article (which only focused on production).
According to studies at a consolidated level on market share in our cigarettes industry, the first three companies in order are British-American Tobacco Romania (BAT), JT International Romania (JTI) and Philip Morris Romania (PMI).