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October
2003

TOBACCO INDUSTRY NEWS (cont.)

Matasa Factory Among Miss Universe Visits

Amelia Vega, Miss Universe 2003, returned to her homeland of the Dominican Republic in August for the first time since she was crowned in May. Vega, a native of Santo Domingo, spent several days in meetings with officials, dedicating time to HIV/AIDS outreach, and participating in parades and local events. She also took time to visit and tour Matasa, manufacturer of Fonseca cigars and other premium brands. Master blender Manuel Quesada hosted Vega on her tour through the well-known factory showing her what makes Matasa a leader in the manufacturing of Dominican cigars.

Timber Wolf, Red Man Outfit Winners at Cabelas

Timber Wolf and Red Man recently completed their national "Outfitted for Life Sweepstakes," awarded shopping sprees from Cabela's, the World's Foremost outfitter for hunting, fishing, and outdoor gear.

"We're pleased to be able to offer sweepstakes such as this, which really fits the Timber Wolf and Red Man user's lifestyle," said John Campbell of Swedish Match North America, Inc., manufacturer of Timber Wolf and Red Man. "Clearly the outdoor life - camping, hunting, and fishing - are activities our customers have a passion for and it's great to be able to provide prizes that the winners will truly enjoy for many years to come."

Paul Huff of Covinton, Ga., won the grand prize, a $10,000 shopping spree at Cabela's. "It's just absolutely tremendous to win a prize like this." said Huff. "I think I'll be set for life after this."


Wine Country Benefit

One of the more fascinating annual cigar events is held each summer in California's wine country, called cigarBQ. The event has grown significantly from its debut in 1998, this year hosting about 1,000 attendees, 65 wineries, and 15 cigar companies, held at the Luther Burbank Center in Sonoma County, Calif.

The celebration has donated thousands of dollars to local charities from proceeds of ticket sales, says Hans Dipple, executive director, cigarBQ.

The event taps both local and national sponsorships, including such cigar makers as Altadis, Ashton, Avo, Camacho, CAO, Graycliff, General Cigar, and Indian Tabac.

For the $125 admission charge, attendees also receive 12 premium cigars and a cuter, unlimited wine and food, a commemorative cigarBQ wine glass, and a canvas tote bag, among other items. A silent auction is also held, featuring wines and other items donated by sponsors, with proceeds donated to charities.

Most recently, Zino Platinum cigars hosted its own cigarBQ at the Blackstone Winery in Kenwood, Calif. in October, and other affiliated events have also been held at area wineries.

For more information, visit the event's web site: www.cigarbq.com.


Obituary - Peter Stokkebye, 72

Third generation tobacconist Peter Stokkebye died on October 9 of a blood clot. He was 72.

Born in Odense, Denmark, Peter, apprenticed at the Wilhem Lange tobacco factory near Copenhagen, and served in King Frederik IX's Royal Guard at the Copenhagen Palace. Following his year of service, he joined the Burger Sohne Cigar Co. in Switzerland, working at the family's Veit & Cei. cigar factory in Beinwill am See.

He later learned the tobacco leaf trade at the Universal Leaf Co. subsidiary J.P. Taylor Co. in Henderson, N.C., working the tobacco circuit in the Carolinas, Kentucky, Tennessee, and Maryland. In 1953, he married his childhood sweetheart.

In 1954, Stokkebye joined cigarettte producer E.D. Laurens in Geneva as leaf manager, purchasing, later rising to vice president of leaf tobacco an quality control manager. In 1962 he joined the family business, Stokkebye Tobaccon in Odense, Denmark. He concentrated his efforts in bringing mild aromatic tobaccos to the ripening North American market to which his company continues to supply a substantial share of products.

Stokkebye is survived by his wife of 50 years, Bente.

Memorials can be made to the Peter Stokkebye Memorial Fund in care of Peter Stokkebye International, Ltd., P.O. Box 481938, Charlotte, NC 28269.


R.J. Reynolds to Slash Staff, Shift Promotion Focus to Core Brands

Winston-Salem, NC - Following the release of dismal second quarter results, R.J. Reynolds Tobacco announced major restructing plans that includes laying off 40 percent of its employees, or 2,600 workers, and focusing marketing dollars on two top brands. The moves are targeting $1 billion in cost saving by the end of 2005.

"Reynolds Tobacco is fundamentally changing the way it operates its business in order to deliver profit growth," said chairman Andrew Schindler. "Volume declines and lower margins led us to conduct a comprehensive business review over the past several months."

The company will focus its brand portfolio strategy on its premium brands with the highest growth potential, devoting less attention to Winston and Doral. The top priority will be maintaining Camel's growth; positioning Salem for growth will be its second priority. Reynolds said it will also be cutting back on its free product promotions.

R.J. Reynolds' second-quarter net income plunged 67 percent, while cigarette shipments fell by 10.7 percent. To compete in a punishing price and promotion war in the cigarette segment over the past year, the company has discounted and heavily promoted all four of its major brands, cutting deeply into its earnings. Market share was largely protected, however.

Under the restructuring, the company's goal is to increase profits, and is prepared to sacrifice market share.



SMOKESHOP - October, 2003