Imperial Brands said its profit for the first half of the year will be higher on the back of strong tobacco pricing and increased sales of its products such as disposable vapes.
The maker of Winston cigarettes and Backwoods cigars expects to meet its full-year expectations of growing net revenue and delivering a step up in adjusted operating profit growth.
Imperial Brands said last year it would increase prices in its key markets to offset declining volumes, while the company also faces regulatory pressures such as a potential UK ban on cigarette sales to younger people.
For the full-year, on a constant currency basis, tobacco and next generation product (NGP) like disposable vapes net revenue is expected to grow at a low single-digit percentage rate.
Analysts had expected total tobacco and NGP revenue to be about £8.1 billion (€9.4 billion), according to company-provided estimates.
Share Buyback
As of 31 March, the company completed £604 million (€704.2 million) of its £1.1 billion (€1.3 billion) share buyback for this year, representing approximately 3.7% of the share capital as at 1 October 2023.
The buyback is on track to complete no later than 29 October and represents an ongoing source of shareholder returns alongside our progressive dividend policy, Imperial Brands added.
The company will report interim results for the six months ended 31 March on 15 May 2024.
In November of last year, Imperial Brands forecast revenue and profit growth in 2024, helped by pricing actions and investments in tobacco alternatives.
At the time, it said its strong financial performance, three years into a five-year strategy anchored on winning back market share in five key tobacco markets, gave it confidence it could increase its adjusted operating profit by mid-single digits next year and beyond.
News by Reuters, additional reporting by ESM.
