Tobacco plant invests €350m since privatisation

By TPN/Lusa, in News · 14-12-2018 10:31:00 · 0 Comments
Tobacco plant invests €350m since privatisation

Tabaqueira, the Portuguese subsidiary of Philip Morris International, has invested "about €350 million" since it was privatised, the general director said, acknowledging that the Portuguese plant may be converted to produce heat-not-burn tobacco.

"Since its privatisation in 1997, the company has invested about €350 million" in the Portuguese market, Tabaqueira's general director, Miguel Matos, said at a meeting with reporters.

Tabaqueira is one of Portugal's biggest exporters, it invests between €13 million and €14 million a year in the Portuguese market, the company said.

The Philip Morris International (PMI) subsidiary in Portugal is following the group's trend, changing the paradigm of the business with the introduction of heat-not-burn tobacco (called Iqos) the company's strategic wager, the general director said.

Given this strategy, Tabaqueira says the Portuguese plant may be converted to produce heat-not-burn tobacco.

"As it is our intention to convert the smokers to these products", the plants "also have to be converted," Miguel Matos said, noting that recently the group's plants in Italy, Greece and Romania had been "totally" converted.

In other words, those plants stopped producing conventional tobacco and moved over to producing heat-not-burn tobacco.

"The idea is that the next plants are to be partially converted" to operate a dual system, conventional and heat-not-burn cigarettes.

In the case of Portugal, the conversion may be partial.

"I can't give a [specific] date", he said as there are other Philip Morris plants that are competing against one another to capture this investment.

Tabaqueira "wants to stop selling conventional cigarettes and produce heat-not-burn products", he stressed adding that within six years (2025) PMI's goal is that about a third (30%) of its business is based on heat-not-burn products.

The overall weight of this business area in 2017 was 16%.

Asked about any interest in cannabis growers, the general director rejected that scenario, stressing that the Philip Morris focus was on heat-not-burn tobacco.


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