Swedish Match warns of profit downturn for U.S. cigar unit
STOCKHOLM Oct 11 (Reuters) - Cigar and moist snuff maker Swedish Match said on Friday a tougher market for U.S. cigars would push full-year profit for its second-largest unit below the level of 2012.
Increased competition in cigars in the United States had already hit prices in the second quarter but the company previously said it expected modest full-year profit growth for that business, despite higher sales.
On Friday Swedish Match said competition had intensified, giving lower than expected third-quarter volumes and operating profit for the U.S. mass market cigar business.
"We now anticipate operating profit for the other tobacco products segment in the third quarter to be in the range of 50 to 60 million Swedish crowns below the third quarter of the prior year," the company said in a statement.
The unit had an operating profit of 300 million crowns ($46.1 million) in the third quarter of 2012.
Swedish Match said full-year operating profit for the unit would be below the 1.16 billion crowns of 2012.
The other tobacco products unit made up around 21 percent of total sales in 2012 and 29 percent of the company's operating profit.
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