Tobacco firm Imperial Brands' FY profit beats forecasts
Adds details throughout
LONDON, Nov 19 (Reuters) -Cigarette maker Imperial Brands IMB.L on Tuesday reported forecast-beating operating profit and said it expected another strong performance next year, as revenues from smoking alternatives soared 26%.
As well as higher sales of new products such as vapes or nicotine pouches, the maker of Winston cigarettes and Backwoods cigars has also offset falling tobacco volumes with rising prices.
It reported a 4.6% increase in adjusted operating profit for the year to Sept. 30, against analyst expectations for a 4.3% rise.
It said it expected operating profit to grow close to the middle of its mid-single-digit range again next year.
All cigarette companies are grappling with declining smoking rates in some markets, due to stricter regulation and growing awareness of health risks. They are looking to grow revenues from alternative products to mitigate the impact, although these ventures are often loss-making as they build scale.
Imperial's brands, such as blu e-cigarettes and skruf nicotine pouches, saw a 26% increase in net revenue in constant currency terms, helping reduce the division's losses by 43% to 79 million pounds ($100.07 million).
Adjusted operating profit from tobacco, which still makes up the bulk of Imperial's business, was up 2.5% thanks to higher prices.
Imperial already announced a full-year dividend for 2024 and a share buy back for 2025, which it said would boost shareholder returns to 2.8 billion pounds in its new financial year.
The company said it was working on a new five-year strategy, and will provide details at a capital markets day in March.
($1 = 0.7895 pounds)
Reporting by Emma Rumney, Editing by Louise Heavens
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