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Tobacco giant Imperial Brands reported a rise in annual profit as revenue ticked higher on market share gains amid increased tobacco spend during the lockdown measures imposed across several countries.
For the year ended 30 September, pre-tax profit fell to £2.17 billion from £1.69bn year-on-year as revenue rose 3.1% to £32.6 billion
'It would appear smokers have chosen to allocate more of their discretionary spend towards tobacco,' the company said. 'Market share gains driven primarily by lower value markets; we grew share in 3 of our top 5 markets.'
Tobacco volume declined 2.1% but this was a 'significant' improvement on last year's 4.4% reduction.
Next generation products including vaping reported an adjusted operating loss of £323m, compared with a profit of $224m and included £124m write-downs in inventory and IP with an additional £29m write-down in H2.
The company said it expected the 'moderated' level of loss to continue in 2021.
The annual dividend was 137.7 pence per share, down from 206.6 pence after the company announced a re-base of the dividend earlier this year.
Looking ahead, the company said it expected to deliver low to mid-single digit growth in organic adjusted operating profit at constant currency, excluding the impact of the Premium Cigar sale.
Tobacco pricing was expected to remain strong although with some ongoing mix headwinds and with lower stock profits, while the duty free channel was likely to remain depressed for much of the year, it added.