Hospodarske noviny daily reported that total sales of cigarettes would reach 21.5-22.0bn this year, which represents an improvement compared with previous years. The sales level would be similar to that in the second half of the 90s. Nevertheless, the news is largely neutral for PMCR, as recently applied excise tax hikes together with planned excise tax increases have shifted cigarette consumption towards cheaper brands (and possibly illegal imports and/or local production), where PM CR has weaker market position. Indeed, the last tax hike in April 2004 likely contributed to the 4pps decrease in PM CR's market share in the CR in H1 2004 to 75.5%.
Tomáš Gatěk