Driven by a continued high demand for handmade premium cigars in the U.S. and good results from the integration of Agio Cigars, Scandinavian Tobacco Group (STG) is reporting strong organic growth in net sales and EBITDA for the second quarter of 2021.
Some highlights from STG’s second quarter include:
- 7.5 percent organic growth in net sales
- 20.8 percent organic growth in EBITDA before special items
- Return on invested capital was 12.3 percent
Here’s what STG’s CEO, Niels Frederiksen, had to say about his company’s second quarter performance:
“We delivered a strong quarterly performance with growth in both net sales and EBITDA driven by strong sales of handmade cigars in the U.S. and a favorable mix. We expect continued high demand for handmade cigars for the rest of the year and we are raising our financial expectations for 2021 to reflect that. Additionally, we continue to implement our Rolling towards 2025 strategy and show good progress on the transformation of the company.”
Though there’s currently a high demand for premium handmade cigars in the U.S. that is contributing to the company’s current success, STG does anticipate growth to taper off during the second half of the year as year-on-year comparisons become more difficult with the market expected to normalize somewhat. STG’s full year is now expected to be stronger than previously anticipated, although the risks remain higher than normal due to the ongoing impact of COVID-19.