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| ALTADIS STILL A BILLION-SELLER IN CIGARS |
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Overall, Altadis is a very healthy company in a challenged industry. Cigarette sales totaled an astonishing $2.72 billion U.S. on sales of 120.7 billion cigarettes during the year, up 3 percent from 2007 in revenue. Earnings before depreciation and taxes was $967.2 million, a very handsome profit margin of 35.6 percent. The company’s total sales, including its logistics division, were $6.3 billion and earnings before depreciation and taxes were $1.9 billion. Both figures were up from 2007. No wonder Imperial wanted to buy Altadis so badly! Future reports will be issued by Imperial alone and will may not break out some of the details for the combined cigarette operations, but since Imperial does little or no business in cigars, its reports on that sector will showcase the Altadis cigar portfolio. What if the embargo ends? With Raul Castro making a series of changes to the economic situation of Cuba and with less than a year to go in the Bush Administration, thoughts of a future change in American policies have cigar companies considering their options in advance. A recent article in the trade journal Smokeshop by CubaNews editor Larry Luxner pointed out some truths about Cuban cigars and the American market which may not be well enough appreciated: Norm Sharp, president of the Cigar Association of America, said what people generally don’t understand is that “it was always Cuban tobacco that was highly sought after, not the cigar themselves.” He said most of the premium cigars consumed domestically prior to 1962 – when the embargo went into effect – were handmade in Customs-bonded factories in Miami, Tampa, New Jersey and other U.S. cities with large Cuban immigrant populations.Luxner further noted a comment from former Consolidated Cigar chief Dick DiMeola that “In the five or six years prior to 1962, when the embargo went into effect, Cuban factories supplied an average 14 million of the 185 million premium cigars smoked in the United States – or only 7.5 percent of the total . . .” Today, the American premium market is over 300 million, but even so, it’s generally thought that Cuban cigars will comprise – after an initial boom – about the same percentage as before the embargo. But the competition for Cuban leaf to be incorporated into brands made in the Dominican Republic, Honduras, Nicaragua and elsewhere will be fierce. And the winner is: Congratulations to Philip Kary of Muskegon, Michigan, winner of our “Register & Win” drawing for a free box of El Rico Habano Torpedoes from our Perelman, Pioneer & Company humidors, courtesy of Mike’s Cigars. Up for your pleasure this week, just a week late for the Jewish holiday of Passover, is a cabinet of 25 King David Presidentes, in Esteli, Nicaragua. They’re mild-to-medium in body with plenty of flavor and offered in the classic double corona size of 7 1/2 inches by 54 ring gauge, provided courtesy of our friends at Mike's Cigars.. The box will be awarded in our drawing to be held on Sunday, May 4. To enter, just click on the “Register & Win” tab above and fill out the required information. If you have entered in the past, there is no need to re-enter; all past entries are carried forward to future drawings. You must be 21 or older to win; good luck! ~ Rich Perelman CLASSIFIED ADVERTISINGCigar Humidors and Cigar Accessories at Humidor Vault! Your online cigar humidor source, with rock-bottom pricing and fantastic customer support!Like sports? Get news and commentary you won’t see in your morning newspaper at TheSportsExaminer.com! Join the examination! A limited amount of classified advertising is available in this space on a weekly basis. For details, call Pat Harris at (213) 365-7965 or inquire by email by clicking here. Have an opinion? You can send it using the “Comment” button below! Don’t forget to register for our drawing for free cigars and accessories! Just click on the “Register & Win” button above; enter today! Looking for a cigar party? Take a look at our exclusive list of hundreds of cigar events across the country, listed by state and date, only on CigarCyclopedia.com!
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Tim
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| I have a thought/question about the article dealing with what will happen if the Cuban embargo ends. It says that the big demand will be for Cuban tobacco rather than Cuban cigars themselves, and that factories in the Dominican Republic, Honduras and elsewhere will be using Cuban tobacco to produce their cigars for the American market. The article implies that these producers in other countries aren't already using Cuban-grown tobacco, but why would that be? Can't they use it for cigars sold in the European and Asian markets? Or is it that the American market is so big that it dictates the profitability of using Cuban leaves at all? It seems weird that all Cuban tobacco would be exported only in the form of completed cigars--Are they perhaps not growing enough for there to be a surplus to export as leaves only? Why would they boost production enough for a surplus only if the American market opened up? | |
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Did you know?
“Csonka cigars are named for the Hall of Fame fullback of the Miami Dolphins, Larry Csonka.
