Swedish Match Q1 profits flat

(AFX) Swedish Match AB said first quarter pretax profit amounted to 507m kronor, unchanged from last year excluding one offs and slightly below market forecasts of 530m, as recorded by SME Direkt.

Last year’s pretax profit of 1.878bn was boosted by a 1.417bn gain resulting from settlement of its legal case against UST Inc unit US Smokeless Tobacco Co.

First quarter sales fell 35m kronor or 1% to 2.967bn kronor year-on-year. In local currency terms sales were up 1%.

Operating margin rose to 17.8% from 16.9%.

The company’s snuff sales fell by 6% to 703m kronor in the first quarter due to lower average prices in the US following a repositioning of the Timberwolf snuff brand, as well as due to a larger share of US volumes coming from the low price Longhorn brand.

Group operating profit for the quarter amounted to 528m kronor, versus 1.924bn a year earlier including the UST settlement and 507m excluding it. The company said this year’s first quarter operating profit was hit by 31m kronor in costs associated with the closure of its match factory in Valencia, Spain.