Tue. Jul 5th, 2022


Imperial Brands has announced that it is pulling out of Russia entirely, becoming the latest large consumer brand to exit the country.

The maker of Winston and Davidoff cigarettes said in a statement on Tuesday that it had “begun negotiations with a local third party about a transfer of our Russian assets and operations”.

Imperial announced last week it was suspending its operations in Russia. Its decision to end its presence in the country follows a similar move by British American Tobacco, which is also transferring its assets to a local third party.

Kingsley Wheaton, chief marketing officer at BAT, told the Financial Times on Friday that suspending activities or exiting Russia, rather than transferring assets, would be regarded as “deliberate bankruptcy” and could lead to criminal charges being brought against the company’s management.

“[Russia] will regard that as deliberate bankruptcy and. . . will pursue management of the company and potentially bring criminal charges, ”he said.

Imperial would not comment on potential action from Russian authorities. However, a spokesperson said the decision was taken in the best interests of Imperial’s 1,000 staff in Russia, including those at the company’s factory in the south-western city of Volgograd.

“Clearly there is a benefit to doing this in an orderly way rather than in a disorderly way,” they said.

Workers will continue to be paid while the negotiations continue.

In the past financial year, Russia and Ukraine represented 2 per cent of net revenues and 0.5 per cent of adjusted operating profit, meaning there will be a “relatively small impact” to profits from the exit, Imperial said.

The decision means Imperial’s full-year guidance will lower to a range of 0 to 1 per cent. The company had previously stated it would achieve revenue growth in line with its sales in 2021 of 0.7 per cent.



Source link

By admin

Leave a Reply

Your email address will not be published.