Global Vaping Industry Weekly Report (8.21-8.27)

This week's report from Two Supremes includes key news from the global vaping industry from August 21 to August 27.

[1] To gain a more comprehensive understanding of the various aspects of the e-cigarette supply chain and explore its current status, Two Supremes released a survey on the e-cigarette supply chain for the first half of 2023 on July 10. According to the data, over 60% of companies achieved performance growth in the first half of 2023, with 11.9% of companies exceeding expectations. On the other hand, 19.0% of companies' performance declines were in line with expectations, while 16.7% of companies experienced declines beyond expectations.

[2] According to a report by the Russian newspaper Izvestia on August 22, starting March 1, 2024, Russia will ban the sale of flavored e-cigarettes. Meanwhile, the Russian Ministry of Health has prepared a list of banned additives. Reports indicate that the Ministry has prepared a list of many flavorings that are considered to make nicotine e-liquids more appealing. These flavorings include food flavors such as fruits, vegetables, herbs, spices, ginger, and cinnamon, as well as sweeteners.

[3] Russian media predict that after September 1, 2023, e-cigarette prices will rise significantly, with an expected increase of 30%.

The price increase will be attributed to the rising exchange rates of the euro and dollar, as well as logistical difficulties.

[4] On August 24, the Bao'an District Bureau of Industry and Information Technology in Shenzhen issued a notice regarding the application for contribution reward projects for the first half of 2023, stating that Bao'an will reward the top 20 e-cigarette companies that contributed to the increase in added value in the first half of the year, with a deadline for applications set for September 12.

[5] According to data from Chinese customs, Two Supremes has compiled statistics on China's e-cigarette exports to the United States for the first half of 2023. The statistics show that from January to June 2023, China's e-cigarette exports to the United States amounted to $1.489 billion, accounting for 48.20% of last year's total exports, a year-on-year decrease of 2.2%, and accounting for 27.15% of China's total exports.

[6] New Zealand's Minister of Health, Ayesha Verrall, announced that new regulations aimed at limiting youth access to e-cigarettes have been confirmed and will officially take effect on September 21 this year. The new regulations require that all e-cigarette devices sold in New Zealand must be equipped with removable batteries; e-cigarettes must be kept as far away from children and young people as possible, and new specialized e-cigarette stores will be prohibited within 300 meters of any school.

[7] According to the U.S. Food and Drug Administration (FDA) website, the FDA has issued warning letters to 15 online retailers for selling and/or distributing unauthorized e-cigarette products, whose packaging designs resemble characters, school supplies, toys, and beverages that appeal to children.

[8] The well-known disposable e-cigarette brand LOST MARY's parent company, Miracle, has sued the UK-based disposable e-cigarette brand FOUND MARY. Miracle claims that FOUND MARY's products are nearly identical to LOST MARY's products, infringing on LOST MARY's trademark rights.

[9] On August 21, Juan Facundo Teme, president of the Argentine E-Cigarette Association (AsoVape Argentina), was interviewed by Two Supremes, where he shared the current status of the Argentine e-cigarette market and provided analysis and forecasts.

[10] Smoore released its second-quarter financial information, showing that Smoore's operating revenue for the first half of 2023 was 5.123 billion yuan, a 9.4% decline compared to last year, with an adjusted net profit of 758 million yuan. The gross profit for the first half of 2023 was 1.8553 billion yuan, a year-on-year decrease of 31.4%.

[11] On August 25, Yinghe Technology released its 2023 semi-annual report, stating that the company's operating revenue was 4.801 billion yuan, a year-on-year increase of 3.84%. The net profit attributable to shareholders of the listed company was 298 million yuan, a year-on-year increase of 12.81%. The net profit attributable to shareholders of the listed company, excluding non-recurring gains and losses, was 263 million yuan, a year-on-year increase of 0.54%. The basic earnings per share were 0.46 yuan. Revenue from the e-cigarette business was 1.433 billion yuan, a year-on-year increase of 1477.33%, with an operating profit of 485 million and a net profit of 417 million.

[12] The Malaysian Vape Chamber (MVCC) released the "2023 Malaysia E-Cigarette Industry Research" report, which shows that as more cigarette users switch to e-cigarettes, the number of consumers has also increased, with retail value skyrocketing from 2.27 billion ringgit in 2019 to an estimated 3.48 billion ringgit by 2023.

[13] Altria announced on its official website that its subsidiary NJOY has filed a patent infringement lawsuit against JUUL LAB, requesting the U.S. International Trade Commission (ITC) to prohibit the import and sale of certain JUUL e-cigarette products, including the currently sold JUUL devices and JUUL pods.

[14] Through a business-driven legal protection, four chain retailers, including Sanborns, Benavides, 711, and Oxxo, will be able to freely sell e-cigarette products, despite the ban on e-cigarette sales issued by the Mexican president. This means that Philip Morris International will be able to freely distribute its e-cigarette products in Mexico. The newspaper Milenio reported, "Sources revealed that Oxxo obtained a final ruling from the Second Administrative Court in Mexico City on August 10, 2023."