British American Tobacco’s cigarette volume during the three months to the end of March, at 152 billion, was said by the company to be down by about 3.6 percent on that of the first quarter of 2014, 158 billion.
Volumes were depressed in each of the company’s four regions: from 50 billion to 49 billion in its Asia Pacific region; from 31 billion to 29 billion in its Americas region; from 24 billion to 23 billion in its Western Europe region; and from 53 billion to 51 billion in its Eastern Europe, Middle East and Africa region.
According to an interim management statement issued today, BAT’s five Global Drive Brands recorded a volume increase of 5.7 percent. ‘Dunhill volume increased by 1.2 percent, as good growth in Indonesia and Brazil outweighed lower volume in South Korea and the GCC [Gulf Co-operation Council countries],’ BAT said.
‘Kent volume was 1.6 percent lower, as higher volume in Iran and Turkey was more than offset by lower volume in Russia, Japan and Romania.
‘Lucky Strike was 5.0 percent higher with increases in Mexico, France and Belgium more than compensating for lower volume in Japan and Italy.
‘Pall Mall volume was up 2.4 percent as growth in Pakistan, Poland and Mexico more than offset reductions in Italy and Russia.
‘Rothmans volume increased by 36.9 percent, driven by a strong performance in a number of markets, including Russia, Australia, Kazakhstan, Turkey and Italy.
Meanwhile, the company’s total tobacco volume, including the volume of tobacco products other than cigarettes calculated as cigarette stick equivalents, fell by about 3.6 percent from 164 billion to 158 billion.
BAT reported that the trading environment remained ‘challenging due to continued pressure on consumers’ disposable income worldwide and the impact of adverse exchange rates at a transactional level’.
However, it said that Vype had continued to deliver excellent organic growth in the UK e-cigarette market, providing a strong platform for planned launches in other countries in 2015.
‘We remain on track to launch Voke, a nicotine inhalation product licensed as a medicine, in the UK later this year, and we continue to make good progress in tobacco heating products, with plans to test market a product in 2015,’ it added.
Group revenue for the three months to the end of March, at constant rates of exchange, grew by 1.7 per cent on that of the three months to the end of March 2014, but fell by 5.8 percent at current exchange rates.
“The Group continued to perform well in the first three months of the year despite the challenging trading environment,” chief executive Nicandro Durante said in presenting the results.
“Our market share increased by 40 bps driven by our Global Drive Brands which continue to deliver strong share and volume growth.
“Revenue increased at constant rates of exchange, driven by pricing more than offsetting lower volume, while adverse exchange rate movements led to a reduction in reported revenue.
“I remain confident that we will deliver another year of good earnings growth at constant rates of exchange, with performance significantly skewed to the second half of the year principally due to a strong first-half volume comparator and the timing of price increases.”