Imperial Tobacco cuts £110m from Spain profit forecast
Cigarette maker Imperial Tobacco has warned that its profits from its Spanish operation could be cut by up to £110m this year due to a price war.
The maker of Gauloises and Golden Virginia said cuts to retail prices “have impacted all market participants”, it said, and it has taken action to protect the sustainability of its business there.
The reduction in its operating profit forecast affects trading for the year to September 2011, and up to £40m of the cut is due to a “one-off non-recurring impact on our logistics business,” the company said in a statement.
“We have acted to protect our market position and the long-term sustainability of our Spanish business and continue to monitor the situation closely,” it added.
Imperial Tobacco is the world’s fourth-largest cigarette manufacturer.