Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Imperial Brands off to good start, eyes vaping improvement

Published 03/30/2021, 04:08 AM
Updated 03/30/2021, 04:10 AM
© Reuters. FILE PHOTO: Packs of Gauloises cigarettes are on display in a tobacco shop in Vienna, Austria

© Reuters. FILE PHOTO: Packs of Gauloises cigarettes are on display in a tobacco shop in Vienna, Austria

By Siddharth Cavale

(Reuters) -Imperial Brands Plc said on Tuesday it is off to a "good start" this year as the maker Gauloises and Winston cigarettes looks to capitalise on higher tobacco prices and "significantly reduced" losses in vaping.

On aggregate it has started to increase its tobacco market share in its top five markets with gains in the United States, UK and Spain offsetting declines in Germany and Australia, the FTSE-listed company said.

New CEO Stefan Bomhard two months ago laid out a five-year plan that focuses investment on five markets that generate 72% of its profits.

Imperial will also target tobacco-heating products in Europe and e-cigarettes in the United States, reducing losses from its previous one-size-fits-all approach.

The company reiterated its forecast for low-to-mid single digit growth in organic adjusted operating profit growth for the year and said overall tobacco volume sales were in line with its expectations.

In the first half it expects group net revenue to grow by at least 1% on an organic, constant currency basis, due to higher tobacco prices and higher next-generation product (NGP) revenue growth. It also expects higher profits from Logista, its logistics operations in Europe.

Imperial has lowered its NGP aspirations, mainly e-cigarettes, after missing several sales targets over the last five years.

Its NGP sales fell 27% last year, prompting a 124 million pound ($170 million) writedown on the business.

© Reuters. FILE PHOTO: Packs of Gauloises cigarettes are on display in a tobacco shop in Vienna, Austria

In contrast, rival British American Tobacco (NYSE:BTI) said it would put more resources behind such products after seeing three million more customers use its e-cigarette, tobacco heating and oral nicotine products during the COVID-19 pandemic in 2020.

Imperial shares were down 0.4% in early trading.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.