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Philip Morris To Stop Selling Marlboro in The U.K. in 10 Years

The Marlboro cigarette brand will disappear from U.K. shelves 10 years from now, after more than a century of taking up tobacco shop space. Q2 2021 he...

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This story originally appeared on ValueWalk

The Marlboro cigarette brand will disappear from U.K. shelves 10 years from now, after more than a century of taking up tobacco shop space.

- Valuewalk

Q2 2021 hedge fund letters, conferences and more

A Non-Smoking Nation

The announcement was made by Jacek Olczak, executive director of Philip Morris International Inc (NYSE:PM), who says that the company is veering towards a more radical diversification strategy in the cigarette business.

Olczak said that the brand would disappear, as “the first choice for consumers is they should quit smoking,” he told The Telegraph. “But if they don’t, the second-best choice is to let them switch to the better alternatives.”

Philip Morris wants to draw nearly half of its revenue from its non-smoking products by 2025, as the whole company is looking into the world of health and wellness. The mission, hence, is to help smokers quit the habit around the world.

The revenue of the cigarette giant in the U.K. is around £800 million a year, where the government has set sights on making England smoke-free by 2030, which will be achieved when smoking rates hit 5%, according to news portal NPR.

Smoking rates in the country are already comparatively low, while cigarettes are heavily taxed and, since 2016, sold in plain packaging. In 2019, the government pledged to reduce the prevalence of smoking to 5% by 2030, about a third from current levels.”

Still a Growing Business

Philip Morris reported profit of $2 billion in this year’s second quarter –an 11.6% increase from the same period last year.

“The volume of cigarettes and heated tobacco units sold rose by 6.1% to 180 billion units. The company recorded sales declines only in Australia and East Asia,” while the greatest growth was reported by the Middle East and Africa (12.7%) and the EU (8.7%).

But Philip Morris has also felt the heat after anti-smoking activists called it “hypocrite” after the £1 billion acquisition of Vectura, a British pharma firm that manufactures asthma inhalers.

Further, there is intense skepticism as to companies being able to completely shed off traditional cigarettes, while alternative products can be almost as harmful.

Still, Olczak told Business Insider, “We can see the world without cigarettes ... And actually, the sooner it happens, the better it is for everyone. With the right regulation and information, it can happen 10 years from now in some countries. And you can solve the problem once and forever.”