Tobacco maker Imperial Brands fell short of profit and sales estimates in the first half of its financial year, with the business impacted by lower retailer demand for cigarettes in the United States, however it reiterated its full-year outlook.
The firm reported first-half organic adjusted revenue of £3.57 billion, while analysts had forecasted £4.02 billion, according to Refinitiv data. Operating profit was up 8.1% to £1.59 billion.
The company attributed the weaker first-half performance to 'lower U.S. trade inventories' coupled with a drop in travel retail sales due to the pandemic.
Imperial, however, kept its full-year forecast intact, which calls for low- to mid-single digit organic adjusted operating profit growth at constant currency.
In a statement, Imperial Brands said that it made a 'positive start in implementing our new strategy to transform the business', noting that net revenue in its tobacco arm continues to benefit from strong pricing.
It said that it has started to stabilise its aggregate market share performance across its five key priority markets, reflecting changes it made to its performance management over the past year.
"This is an encouraging start and one that I look forward to building on over time as we begin to step up investment in new strategic initiatives," commented chief executive Stefan Bomhard.
“We have started to change our culture and ways of working, including developing a new market cluster structure to simplify the organisation and allocating resources more effectively. I have now assembled my new Executive Team with key external hires, who have the necessary skills and expertise to complement Imperial’s existing tobacco experience.
"This has significantly strengthened the capabilities we need to support the successful delivery of the new strategy."