BAT's Irish subsidiary reported that e-cigarette products accounted for 22% of total revenue in 2023, with VELO contributing 3%. However, the company faces risks from the illegal vape trade and potential increases in e-liquid excise taxes.
The board of PJ Carroll & Company, British American Tobacco's Irish subsidiary, reported a 7% rise in net income, growing from €28.48 million to €30.53 million in 2023. Increased e-cigarette sales drove a 23% jump in pre-tax profit to €6.18 million, according to an RTE.ie report on November 28.
Key Highlights of the Report:
- The launch of VELO nicotine pouches in 2023 marked the company’s entry into the "modern oral nicotine pouch" market. Within six months, VELO contributed 3% of total revenue.
- E-cigarette products accounted for 22% of total revenue in 2023.
- Combustible cigarette sales volume dropped by 13% in 2023, but a price increase in March boosted overall combustible cigarette revenue, which accounted for 75% of total revenue.
- After deducting €973,000 in corporate taxes, net profit was €5.2 million, with accumulated year-end profit reaching €42.85 million.
- Total annual revenue was €181.32 million, which included €150.79 million in excise taxes and other taxes.
The directors stated that the main challenges facing the company are the illegal vape trade and the lack of government enforcement against the sale of non-compliant products and sales to minors under 18.
- Illegal trade and Non-Duty Paid Products (NIDP) account for 34% of the combustible market, with illegal cigarettes taking up 19% and NIDP holding 15%.
- Starting from the second half of 2025, the Irish government will impose an excise tax of €0.5 per milliliter on e-cigarette liquids. This tax is expected to increase the prices of all brands, potentially driving consumers toward illegal products or back to traditional tobacco.
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