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BAT’s tobacco volumes down last year

| February 27, 2014

British American Tobacco’s cigarette volumes during 2013, at 676 billion, were down by 2.7 percent on those of 2012.

Volumes were increased in the company’s Asia Pacific region by 4.8 percent to 197 billion, but they were down in the Americas by 5.6 percent to 134 billion, down in Western Europe by 7.7 percent to 119 billion, and down in the EEMEA (Eastern Europe, Middle East and Africa) by 3.8 percent to 226 billion.

BAT’s tobacco volumes during 2013, at 703 billion, were down by 2.6 percent. Tobacco volumes include, as well as cigarettes, other tobacco products whose volumes are stated in cigarette stick equivalents: 0.8 g of roll-your-own; 0.5 g of make-your-own expanded tobacco; 0.7 g of make-your-own optimized tobacco; one cigar; one pouch of snus; and 2 g of loose snus.

The company blamed the fall in its cigarette volumes on the contracting industry volume in Western Europe and in some key group markets, such as Brazil, Russia, Ukraine, Turkey and South Africa, partially offset by strong performances in Bangladesh, Pakistan, Indonesia, Vietnam and countries of the Middle East.

Other tobacco products were said to have continued to have performed well. Fine-cut volume in Western Europe grew by 1.3 percent to 21 billion sticks equivalent as a result of good growth in Italy, Belgium, Germany and Poland, partially offset by declines in the Netherlands and Greece.

“Our international brands grew by 2.1 percent, of which the four global drive brands (GDB) achieved good volume growth of 1.9 percent,” BAT said in presenting its results.

“Dunhill increased volume by 9.7 percent with growth in Indonesia, South Korea and the GCC, partially offset by declines in Malaysia, due to market contraction, and West Africa. Kent volume was down 2.9 percent on [that of] last year as declines, driven by market contractions in Russia, Japan and Romania, were partially offset by growth in the Middle East and Uzbekistan.

“Lucky Strike volume was down by 6.5 percent, mainly driven by the market contraction in Spain, partially offset by higher volume in Philippines and Russia. Pall Mall volume rose by 4.4 percent with strong growth in Chile, Pakistan and Argentina, partially offset by lower volume in Russia, Serbia, Italy and Hungary.”

Rothmans, which this year is being included as one of the company’s GDPs, was said to have performed well with strong growth in Russia, Ukraine, Algeria and Italy.

BAT’s revenue, at £15,260 million, was more or less unchanged, though it was up by 4 percent at constant rates of exchange.

Adjusted profit from operations was up by 3 percent to £5,820 million, and up by 7 percent at constant rates of exchange.

Reported profit from operations was up by 3 percent to £5,526 million, and up by 7 percent at constant rates of exchange.

“British American Tobacco continued to perform strongly in 2013, with another year of excellent earnings growth and cash flow, partially offset by currency headwinds,” said Chairman Richard Burrows in announcing the results.

“The group’s global drive brands also achieved outstanding growth in market share and volume.

“Difficult trading conditions persist in some parts of the world, notably southern Europe, but these results demonstrate that the group’s strategy continues to deliver robust profit and dividend growth.”

Category: Breaking News

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