“With the growth of ZYN surpassing our expectations, we now expect to achieve this well ahead of time.”

In context

“lines in higher margin markets like Japan as adult smokers switch to smoke-free products, and better volume trends in lower margin geographies where smoke-free products are small or not available such as Turkey. There were also significant inflationary pressures on leaf, direct materials and other manufacturing costs. Cost increases on leaf, where inventories cover multiple crop years, and wages are likely to carry over into 2024, and should ease thereafter. Moving now to Swedish Match, which delivered outstanding performance in its first full year as part of PMI, with adjusted pro forma currency neutral top line growth of 26% in Q4 and 20% in 2023. When we announced our offer for Swedish Match in 2022, we targeted a return on investment in excess of our cost of capital within five years. With the growth of ZYN surpassing our expectations, we now expect to achieve this well ahead of time. ZYN delivered another remarkable U.S. performance with plus 78% volume growth in Q4 and 62% in 2023. Internationally, we have launched or relaunched ZYN in 10 markets as planned, as we continue to focus on building a truly global brand. U.S. cigars posted robust 2023 results, growing net revenues and profits. This was driven by strong pricing following an increase in April, partially offset by volume declines which reflect lagged competitor pricing and comparison effects. ZYN’s excellent U.S progress continued in Q4 with 15% sequential growth in 12-month rolling shipments. Impressively, category volume share grew for the third consecutive quarter to 72.8%, an increase of plus 5.4 points year-on-year and plus 2 points sequentially. Retail value share also grew during the quarter to 77.4%,”