Source: Valor Investe - São Paulo / SP - PUBLIEDITORIAL - 14/07/2010

Combining human talent with technology, innovation, boldness and a permanent dialogue with all audiences with which it relates has been a constant in the history of Souza Cruz, since its founding, 107 years ago, in Rio de Janeiro, by the Portuguese immigrant Albino Souza Cross. In all these years, the company has always invested in actions that promote entrepreneurship, sustainable local development and education, at all levels of the production chain: from the production of seeds to the distribution of cigarettes at points of sale. A universe that includes 7.500 employees, 40 tobacco producers and around 250 retailers, operating in a vertical manner, in a dynamic that generates 240 jobs throughout its production chain. The 40 tobacco producers work on a pioneering integrated system, the Integrated Production System, which has been operating since 1918. All of them have easy access to seeds and inputs, as well as receive technical assistance throughout the production process and guarantee to purchase the harvest. The 250 retailers, operating in almost XNUMX municipalities in Brazil, are served by a distribution system that has the support of more than XNUMX employees, including salespeople and deliverers. With an increasingly innovative look, believing in the full right to freedom of choice, won by Brazilian society, and always trusting in the creativity and boldness of its employees, Souza Cruz has become one of the largest Brazilian companies. Leader in the Brazilian cigarette market, with a 62% share, the company closed its balance sheet in 2009, with a net revenue of approximately R $ 6 billion, more than 9% above that recorded in 2008, which generated a consolidated net profit of R $ 1,5 billion, 18,8% more than in the previous year. A leadership guided by a responsible performance of the company in all its activities, combined with an excellent competitive and execution capacity. Positioned among the 10 largest taxpayers in Brazil, it collected R $ 6,3 billion in taxes last year, more than 10% above what had been generated in 2008. Considering the last five years, only Souza Cruz sales taxes increased by more than R $ 2 billion, totaling approximately R $ 26 billion. A company belonging to the British American Tobacco group, the most international of the tobacco groups, which operates in more than 180 countries, Souza Cruz is also present in Cuba, where, since 1995, it has owned 50% of Brascuba, a joint venture with the Cuban government for the production and export of cigarettes. In Brazil, it exports 113,4 thousand tons of tobacco per year, generating foreign exchange for the country. Souza Cruz conducts its business in an ethical manner, committed to the sustainability of its production chain and to the development of the country. It manufactures and markets licit products for adult consumers who appreciate them.

ILLEGAL CIGARETTE MARKET: EVERYONE LOSE

The illegal cigarette market - which includes smuggling, counterfeiting of brands and tax evasion - ends up having a perverse effect on society. It reduces tax collection and job creation, promotes organized crime and confuses consumers with products of dubious origin. In addition, the existence of the illegal market hinders efforts to prevent the consumption of cigarettes by minors, since the much lower price of their products makes them more accessible to this public. To have an idea of ​​what this means, today illegal practices represent about 27% of the national cigarette market and the loss of revenue, according to the Federal Revenue Secretariat, is close to R $ 2 billion per year, which means less social investments. It is not by chance, therefore, that Souza Cruz - co-founder of the Brazilian Institute of Ethics in Competition (ETCO) - has been supporting the government in all actions to combat these practices. An example is the support given to the implementation of the Cigarette Production Tracking Control System (Scorpios). It allows the Federal Revenue, through tax stamps placed on each pack of cigarettes, to monitor online the manufacture and the amounts of taxes due. Another important government initiative, to which Souza Cruz immediately engaged, was the implementation of electronic invoices. The company actively participated in the pilot project, collaborating for its improvement. In addition, it was one of the pioneering companies in the adoption of NF-e in all its units in the country. SPED Fiscal e Contábil, created in 2009 to continue the modernization of the tax authorities' control mechanisms, was another action supported by Souza Cruz for considering that all these initiatives represent a major step forward in the fight against tax evasion.