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Return on sales of tobacco manufacturers of Russia

Information agency Credinform prepared a ranking of tobacco manufacturers of Russia.

The companies with the highest volume of revenue were selected for this ranking according to the data from the Statistical Register for the latest available period (for the year 2013). These enterprises were ranked by decrease in the return on sales ratio. Moreover, for the companies from the TOP-10 list it is given the assessment of the market share based on the volume of annual revenue from main activity.

Return on sales (%) shows the share of operating income in sales volume of a company (share of profit in each ruble earned).

Return on sales demonstrates a shareholder and potential investor if company’s operations are profitable or not. The higher is this indicator, the better; the ratio with «minus» sign testifies to that there is an operating loss - expenses are not covered by current sales.

There is no recommended or specified value determined for the mentioned ratio, because it varies strongly depending on the industry and macroeconomic conditions, where each concrete enterprise conducts business.

For getting of the most comprehensive and fair picture of the financial standing of an enterprise it is necessary to pay attention not only to average values of indicators in the industry, but also to presented combination of financial data and ratios of the enterprise.

Table 1. Revenue, return on sales, solvency index of the largest tobacco manufacturers of Russia (TOP-10)
NameRegionRevenue, in mln RUB, for 2013Return on sales, %Solvency index GLOBAS-i®Market share, %
1 Philip Morris Izhora CJSC
INN 4720007247
Leningrad region 66 229,4 49,1 174 the highest 31,6
2 Philip Morris Kuban OJSC
INN 2311010485
Krasnodar territory 12 851,0 44,3 223 high 6,1
3 Liggett-DukatCJSC
INN 7710064121
Moscow 16 448,6 30,3 222 high 7,9
4 DonskoyTabakCJSC
INN 6162063051
Rostov region 10 541,8 29,2 238 high 5,0
5 Petro LLC
INN 7834005168
Saint-Petersburg 39 306,0 28,0 225 high 18,8
6 British American tobacco-SPB CJSC
INN 7809008119
Saint-Petersburg 31 948,2 17,5 208 high 15,3
7 Imperial Tobakko Volga LLC
INN 3443033593
Volgogradregion 7 689,9 14,2 235 high 3,7
8 Kres Neva LLC
INN 4720011412
Leningrad region 3 815,0 14,0 186 the highest 1,8
9 DonskoyTabakOJSC
INN 6163012571
Rostov region 7 528,3 7,4 215 high 3,6
10 Imperial Tobakko Yaroslavl CJSC
INN 7601000015
Yaroslavlregion 3 059,2 7,4 231 high 1,5

The largest tobacco manufacturers of Russia record a positive return on sales, and the market leader - Philip Morris Izhora CJSC - showed the highest ratio value – 49,1%. The closest competitor in terms of annual revenue, Petro LLC, has a much lower return on sales – 28%. 

tobacco manufacturers of Russia

Picture 1. Return on sales and revenue of the largest tobacco manufacturers of Russia (TOP-10)

The revenue of the largest tobacco manufacturers (TOP-10) made 199,4 bln RUB, according to the last published annual financial statement (for 2013), that is by 6,4% higher, than the ratio of the previous period (187,4 bln RUB).

The three leaders of the Russian tobacco industry: Philip Morris Izhora CJSC, Petro LLC and British American tobacco-SPB CJSC, accumulate 66% of all revenue of the industry.

Today the cumulative investment in the factory Philip Morris Izhora CLSC, which was opened in the Leningrad region in early 2000, exceeds 1,1 bln USD.

The factory produces more than 60 names of such world famous brands of cigarettes as Marlboro, Parliament, Chesterfield, L&M, Bond Street and Next. Currently, the cigarettes manufactured by Philip Morris Izhora CJSC are delivered not only to the Russian market, but also are exported to such countries as Armenia, Kazakhstan, Kyrgyzstan, Moldova, Mongolia, Serbia and Japan.

Petersburg Petro LLC also manufactures products under well-known brands:

  • filtered cigarettes: Winston, Camel, Salem, More, Wings by Winston, Mild Seven, Monte Carlo, North Star, Epique, «Russky stil», «Petr 1», «Nasha Prima», «Zolotoy list», «Nevskie», «Kosmos»;
  • plain cigarettes: «Prima», «Luch»
  • Russian cigarettes: «Belomorkanal».

British American Tobacco Russia closes the Top-3 of the Russian tobacco industry. The portfolio of brands of the company includes such well-known international and domestic brands as Dunhill, Kent, Vogue, Pall Mall, Rothmans of London, Lucky Strike, Viceroy, Yava Zolotaya, Alliance and Yava.

All participants of the TOP-10 list got high and the highest solvency index. This fact signals to potential investors, that the organizations can pay off their debts in time and fully, while risk of default is minimal.