Bar and restaurant owners predict steep revenue declines if South Dakota prohibits smoking in those businesses, but most studies of previous bans suggest those fears are unfounded – particularly for those that serve food.
Opponents of legislation that would expand the South Dakota smoking ban to bars and restaurant largely have set aside the health argument, but the threatened loss of revenue for the state and individual businesses remains their trump card in a bad economy.
Lobbyist Larry Mann has predicted a 30 percent drop in video lottery revenue, a significant hit to a state that takes half. Mike Trucano, a Deadwood video lottery machine vendor, said smoking bans in other states have swallowed 10 percent to 25 percent of business revenue. Advertisement
Supporters of the ban thus far have emphasized the health effects of secondhand smoke to sway lawmakers. But as the House bill moves to the floor as early as Monday, one health advocate is turning his focus to the economic effect.
Darrin Smith, senior director of advocacy for the American Heart Association in Sioux Falls, is preparing a handout for lawmakers that rebuts claims that liquor sales and gambling revenues fall when states ban smoking.
People opposing the ban have manipulated figures from other states when testifying before legislative committees, he said. Minnesota liquor tax revenues kept going up after that state’s October 2007 smoking ban, and Oregon video lottery officials say their revenue decline largely is a result of the bad economy.
“Legislators, the media and the public deserve honest and accurate, factual evidence,” Smith said.
Philip Morris USA said today it will seek appellate review of a jury verdict awarding $8 million in total damages to the family of a former smoker.
Cafe owners and patrons in Austria are still puffing away seven weeks after a partial smoking ban was introduced, and they are not about to stop.
“Why not turn this place into a hospital, while we’re at it?” asks Georg Hold, one of many Viennese “Kaffeehaus” owners now up in arms against the new legislation, which was introduced on January 1.
Smoking bans have been distinctly unpopular and hard to enforce in a country where, according to the World Health Organization, no less than 47 percent of the population smokes, and each consumer burns through an average 2,073 cigarettes per year.
A first attempt in January 2008 to curb smoking in restaurants and bars on a voluntary basis failed miserably.
The findings of a study, conducted by the Institute of Public Health (IPH), Bangalore, this year, shows that over 50 per cent of pre-university (PU) students pursuing courses in arts and humanities are smokers.
The rules and advertisements to discourage the use of tobacco products by the youth have had no impact on students in Bangalore.
The study revealed that 58.9 per cent of students of arts and humanities, followed by 30.6 per cent and 10.6 per cent students of science and commerce streams, respectively, use tobacco products.
The study was conducted in two stages in Bangalore’s 19 PU colleges on 1,087 students of first year PU (53 per cent) and second year PU (47 per cent). At least 18 colleges had one or more tobacco selling points within 100 yards of their campus. The Cigarettes and Other Tobacco Products Act, 2005 prohibits sale of tobacco products within 100 yards of any educational institution. As much as 55.8 per cent of students said that peer pressure had influenced them to use tobacco products. . . .
As much as 18 per cent felt the need to smoke or consume tobacco when they saw film stars smoking or chewing gutka in films
Turkish authorities said on Sunday cigarette consumption decreased in Turkey after a ban.
Cigarette consumption was down 1.1 percent in the second half of 2008 over the same period of 2007, Mehmet Kucuk, the deputy chairman of Tobacco and Alcohol Market Regulation Agency (TAPDK), told AA correspondent.
“Cigarette sales were down 1.1 percent in the second half of 2008 after the cigarette ban entered into force,” he said.
Last year, a wide smoking ban was introduced in Turkey which was said to be challenging the cliche of “smoking like a Turk.”
Under the new law passed in January 2008, smoking will be banned in all enclosed public places including restaurants and bars as of July 19, 2009.
Philip Morris International Inc.’s CEO said Wednesday that the stronger dollar shrank the company’s profit from selling cigarettes in other currencies and it will drag down profit this year again.
When the dollar’s value rises in relation to other currencies, profits from sales in those currencies is diminished as they are translated back into dollars.
The company sells Marlboro, L&M and Parliament cigarettes outside the U.S.
Its stock fell $1.13, or 3 percent, to $37.19 in afternoon trading.
“The (negative) impact of currency is much greater than we previously realized,” Citigroup analyst Adam Spielman told investors. “The underlying business is performing exactly as we had expected, which in this economy is probably a mild positive. But in our view the much greater-than-expected currency sensitivity is a clear negative.”
Philip Morris International’s profit in the quarter that ended Dec. 31 fell nearly 8 percent. It earned $1.45 billion, or 71 cents per share. That’s down from $1.57 billion, or 74 cents per share, a year earlier but well above Wall Street estimates.
Analysts polled by Thomson Reuters on average expected a profit of 62 cents per share.
The cigarette maker said its fourth-quarter revenue rose 2 percent to $15.22 billion.
Philip Morris International, with offices in New York and Lausanne, Switzerland, is the world’s largest non-governmental cigarette seller, smaller only than state-controlled China National Tobacco Corp.
The company spun off from Altria Group Inc. in March 2008. Altria still owns Philip Morris USA, which sells Marlboros in the U.S.
Philip Morris International predicted its 2009 profit will be between $2.85 and $3 per share, at current exchange rates, including an 80-cent hit per share caused by the dollar’s strength.
“The global economic crisis obviously results in uncertainty, particularly on the currency front, and at current exchange rates we face a steep hurdle,” Chief Executive Louis Camilleri said in a statement.
Camilleri said the bulk of the hit the company took from the strong dollar came in Russia, Turkey, Mexico and Ukraine.
While currency comparisons hurt the company, Camilleri said that all signs were that it will continue to generate strong sales.
“We have not witnessed any evidence of a shift in consumer behavior in emerging markets,” he said on a conference call with investors. “No sign of consumer down-trading has yet been detected. This is obviously good news.”
The tobacco company has even raised prices. In recent months, the company has raised prices in countries around the world, including Russia, Ukraine, Indonesia, Italy, Mexico, Spain, the U.K. and others.
For all of 2008, the company’s net income rose 14 percent to $6.89 billion from $6.04 billion. It earned $3.32 per share. Revenue rose 15 percent to $63.64 billion in its first year as an independent company.
Both Philip Morris companies are pursuing sales of smokeless tobacco products to replace the revenue they expect to lose as cigarette demand continues falling.
Sales volume in the U.S. has been falling due to smoking bans, higher taxes and health concerns.
Philip Morris International said Tuesday it had joined Swedish Match for a global partnership to make and sell smokeless products.
Richmond, Virginia-based Philip Morris USA closed on its $10.4 billion takeover of UST Inc. last month, giving it the market leader and brands such as Copenhagen and Skoal.
Philip Morris International also said it has bought the rights to the Petteroes trademark, a fine-cut brand sold in Norway. During the third quarter, Philip Morris International completed its acquisition of Canadian cigarette maker Rothmans Inc. for $2 billion Canadian dollars.
Though a federal cigarette tax hike remains weeks away, at least two U.S. cigarette makers already have upped prices and another is cutting some wholesaler discounts as demand drops.
Both Altria Group Inc., which owns Philip Morris USA, and Lorillard Inc., which makes Newport cigarettes, increased their carton and pack prices in recent days.
Neither company would say what prompted the increases. But the federal tax on cigarettes will rise from 39 cents a pack to almost $1.01 on April 1. . . .
Arkansas’ proposed 56-cent increase, which already passed the state House, would pay for a statewide trauma system and a host of expanded health programs. Lindblom dismissed Mathe’s claim that the increase “unfairly burdens a small group.”
“They are killing those people and making them suffer and live horribly sick and disabled lives,” Lindblom said. “For them to have this kind of sympathy for them on a monetary level when they don’t care they are harming people enormously by their aggressive marketing of their product is two-faced and shameful.”
Background: The tobacco industry has organized research institutions to generate misleading data on indoor air quality, including secondhand smoke exposure and health effects. . . .
Results: Philip Morris sought to establish a network of air quality laboratories throughout Latin America. In El Salvador, in 1997, through Tabacalera de El Salvador (Philip Morris