Imperial Tobacco Group, the fourth largest tobacco company in the world admitted it is facing a 4 percent decline in cigarette sales over the first quarter of the year because of certain problems in supply in the Middle East and several shrinking markets. Nevertheless, in a statement to its investors the company ensured that its full-year results and overall position for the financial year finishing September are in line to meet the forecasts.

Imperial, based in Bristol, UK, manufactures and sells tobacco products and operates in logistics. Among the tobacco brands included in its portfolio there are: Lambert & Butler, Richmond, West, Davidoff, Van Nelle, Golden Virginia, Classic, Gauloises, Style, Cohiba, Montecristo and Rizla.

The company reported that its international flagship cigarette brands West, Davidoff and Lambert & Butler have showed a solid performance, while other strategic brands ended up with a growth in sale volumes. Gauloises Blondes as well performed solidly after dealing with temporary supply problems in the Middle East region.

Imperial Tobacco anticipates that the first-quarter cigarette sales will loose approximately 4 percent due to the supply disruption in the Middle East market and tough competition in the shrinking markets in the United States, and several European countries. According to the company, cigarette sales should be stabilized in the third and fourth quarter, in comparison to the same period in 2009.

The company declared in an interim statement in March that it accomplished a nice performance during the first months of the latest financial year. During that period, Imperial Tobacco stated cigarette shipments in Spain and Germany decreased by approximately 10% and 2% correspondingly. The company experienced a 3% growth in cigarette sales in France and a 9-percent drop in the USA.

Imperial Tobacco admitted last week that its loose tobacco brands showed a higher-than-expected performance, growing by nearly 10 percent in Germany, United Kingdom and several Central European markets.

The effect of the rise in leaf prices has been compensated by price growth in particular markets since the start of the new financial year, Imperial Tobacco mentioned.

The company said they anticipate their capital to keep up with its normal patterns with a considerable outflow in the first six months followed by an inflow during the second six months. As regards the full-year forecasts, the company anticipates the cash inversion to reach nearly 100%. Imperial Tobacco stated last November that its revenues in 2009 financial year were up to GBP 663 million from GBP 428 million in 2008. Annual income increased from GBP 26.5 billion from GBP 20.5 billion achieved in fiscal 2008, a 29% growth.

Imperial Tobacco is going to reveal its half-year results this week.

By Steve Shepherd, Staff Writer. Copyright © 2010 Cigarette-Store.org. All rights reserved.