British American Tobacco (BAT) has reported a 7% increase in adjusted revenue for the full year, with dividend growth of 1.0% to 217.8 pence and a stock buyback plan of £2 billion for 2022.
The tobacco company also reported that its "Next Generation Product" line experienced a sales growth of 51% after adjustments, reaching £2.05 billion, which includes electronic cigarettes, heated tobacco, and oral nicotine products. Despite the division not yielding any profits yet, British American Tobacco stated that they aim to achieve a revenue and profit capability of £5 billion by 2025.
The sustained growth of new categories is the cornerstone of the long-term success plans of British American Tobacco," said Ross Hindle, an analyst at Third Bridge. "With over 1.1 billion smokers still using combustible products, the opportunity to convert consumers to new categories is highly attractive.
In December of last year, the tobacco company raised its annual revenue growth forecast, causing a 2% increase in its stock price, due to increasing focus on its tobacco heating devices and other electronic cigarettes. The company stated that it expects revenue growth to exceed 5% when calculated at a fixed exchange rate, surpassing the previous range of 3% to 5% up until December, and is maintaining its growth expectations for mid-term earnings per share after a single adjustment.
English-American Tobacco gained 1.4 million new customers in the first quarter.
The London-based company reported that sales of their "new category" of lower-risk products are increasing in all major markets, including the United States and Japan. The company added 1.4 million new customers in the first quarter. "The upgrade and delivery of lower-risk products is particularly encouraging," said Jefuji analyst Owen Bennett.
The manufacturers of Vuse e-cigarettes and Glo heated tobacco products have revealed that the number of customers has increased by 1.4 million, bringing the total number of users to 14.9 million. However, this falls short of BAT's goal to reach 50 million e-cigarette users by 2025, with only one third of the target achieved. To meet this objective, sales will need to continue to accelerate.
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