Lorillard net income down 17.4%, e-cig sales down $6 million

[Nate760]

Greensboro-based Lorillard Inc. said its net income was down 17.4 percent in the first quarter. - Greensboro - Triad Business Journal

1. As I posited yesterday in another thread, this would seem to dispel the notion that aggressive movement into the e-cig sector is going to effectively defray the market share that tobacco cigarettes are continuing to lose.

2. Maybe the plateau in cigalike sales is arriving sooner than I thought.

 

[Berylanna]

Can we say "Motive to create ^H^H^H^H^H^H support the FDA's plan" ?

 

[Nate760]

Can we say "Motive to create ^H^H^H^H^H^H support the FDA's plan" ?

I don't know if it'll make much difference for them in the long run. They have three handicaps working against them: 1) hardly anybody uses convenience store-brand cigalikes on a long-term basis; 2) Blu has such terrible word of mouth that their advertising budget and ubiquitous retail presence can't counteract it forever, or even for very long; and 3) Being owned by a tobacco company is not a good thing for an e-cig brand. For one thing, people who are trying to quit smoking are sick of giving their money to the tobacco industry and aren't inclined to keep doing so after they no longer smoke. For another, an increasing number of vape shops refuse to sell Blu because of who owns it. As time goes on, there are going to be fewer and fewer people whose first e-cig purchase is an impulse buy of whatever starter kit they happen to see at 7-11, or Walgreens, or Walmart, or wherever, and I would venture to guess that such purchases comprise a significant chunk of Blu's revenue.

 

[Berylanna]

I don't know if it'll make much difference for them in the long run. They have three handicaps working against them: 1) hardly anybody uses convenience store-brand cigalikes on a long-term basis; 2) Blu has such terrible word of mouth that their advertising budget and ubiquitous retail presence can't counteract it forever, or even for very long; and 3) Being owned by a tobacco company is not a good thing for an e-cig brand. For one thing, people who are trying to quit smoking are sick of giving their money to the tobacco industry and aren't inclined to keep doing so after they no longer smoke. For another, an increasing number of vape shops refuse to sell Blu because of who owns it. As time goes on, there are going to be fewer and fewer people whose first e-cig purchase is an impulse buy of whatever starter kit they happen to see at 7-11, or Walgreens, or Walmart, or wherever, and I would venture to guess that such purchases comprise a significant chunk of Blu's revenue.

I actually LIKE the blu disposables a lot, as long as we are not comparing them to vv devices and as long as I don't mind sleeping under a bridge when I retire (cost too much!) -- I'd been recommending them to anybody that wants to try an ecig just ONCE. I tell them to go to a vape shop or ECF after that. Their non-disposables were not in the same category AT ALL, poor draw, poor flavor, IMO.

 

[Gato del Jugo]

"Lorillard also said that first quarter net sales for its electronic cigarettes segment declined to $51 million, compared to $57 million a year ago. Company officials said the decline is the result of an increase in unit volume that was 'offset by the estimated $7 million mix impact of a lower price on rechargeable kits that were introduced in the third quarter of 2013.'"


In other words, they basically sold a larger number of a less expensive product..


Or so they say...