Japan Tobacco Demonstrates Great Results

Japan Tobacco increased probably the most in a year in Tokyo trading after raising its year-end dividend and net revenue outlook, stating it sees carried on revenue increase in the mid-to-long term.

The stock rose up to 7.9 %, the greatest intraday obtain since November last year. It increased by 7.2 % to 4,458 yen as of 10:44 a.m., while Japan’s benchmark Topix index advanced 0.7 %.

The Tokyo-based company amplified its organized dividend per share for the year through December by 10 yen to 118 yen, and increased its net revenue outlook by around 0.6 % to 474 billion yen ($3.9 billion).

Japan Tobacco, which is paying $5 billion for legal rights to sell Natural American Spirit cigarettes outside the U.S., stated several days ago that it expects the obtained assets to have over 20 billion yen in operating revenue in the fifth year after the transaction is finished.

The dividend boost and revenue outlook “left an optimistic impression,” Yoshiyasu Okihira, an expert at SMBC Nikko Securities., wrote in a note. “There’s space for their 4Q revenue to come beyond their goal.”

In August, Japan Tobacco lifted its full-year net revenue projection by 22 % to 471 billion yen, after pulling out from the beverage and vending machine businesses to concentrate on cigarettes. The previous Japanese monopoly has purchased brands and products abroad to counter a diminishing population and stagnating smoking rate at home.

“The continuing strong business momentum gives us self-confidence to accomplish mid- to long-term revenue growth, enabling us to modify the outlook for year-end dividend per share upwards,” Japan Tobacco President Mitsuomi Koizumi stated in a statement.

Japan Tobacco also modified its operating revenue goal to reveal an exit from the beverage business. Managing revenue will most likely constitute 554 billion yen for the present fiscal year according to ongoing operations, unrevised from its previous outlook, the company stated not so long ago. That in contrast to its August outlook of 668 billion yen, which incorporated the discontinued procedures.

Japan Tobacco is moving to a new accounting time period corresponding to the calendar year

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