Recently, Imperial Brands PLC (hereafter referred to as "IMB") released its 2024 annual report and financial statements, and announced the notice for its 2025 annual shareholders' meeting.
Tobacco and Next Generation Products (NGPs) experienced an increase in net revenue, with tobacco and NGP net revenue totaling £8.2 billion, including £329 million from NGPs. IMB saw growth in market share in five priority markets. Free cash flow generated in the 24 fiscal year was £2.4 billion, and for the 25 fiscal year, ITC has committed to returning £2.8 billion to shareholders. The company reported a 4.5% increase in group operating profit to £3.54 billion, with tobacco and NGP net revenue increasing by 4.6% at fixed exchange rates, including a 3.8% growth in tobacco business and a 26.4% growth in NGP business.
European Market
The company's performance in Europe has been driven by strong pricing for combustibles, improved rates of decline in cigarette sales, and growth in NGP net revenue. In the European region, NGP net revenue increased by 20.5%, reaching a total of 260 million pounds, with growth of 18.3% in Germany, 37.9% in the UK, and 26.6% in Spain. In particular, IMB launched the disposable e-cigarette brand "blu" in the UK, France, and Spain, and introduced a pod-based "blu bar" kit in France and the UK by the end of the year. In the heated tobacco sector, IMB introduced iSenzia tea-based heated tobacco in Italy and Greece; and in the modern nicotine pouch sector, IMB continued to meet consumers' changing preferences by launching ZoneX and Skruf Modern in Norway.
The Americas
NGP's net income increased by 29.4% to reach 43 million pounds, thanks to the successful launch of its modern lifestyle brand Zone by IMB.
Africa, Asia, Australia, Central Europe and Eastern Europe
Net revenue from NGP increased by 136.4%, calculated at fixed exchange rates, with tobacco and NGP net revenue increasing by 3.3%. The tobacco price mix was at 6%, offsetting a 3.5% decline in sales volume. The key market in the region, Australia, achieved robust profit performance for the fifth consecutive year, further increasing market share. In the Central and Eastern Europe (CEE) market cluster, the combustible and NGP investment portfolio performed well. Additionally, leveraging the experience from the Czech Republic market and introducing the blu bar e-cigarette product in Poland, NGP net revenue in Poland doubled during this period. In terms of heated tobacco products, the Czech Republic and Poland introduced the tea-based heating stick iSenzia, accelerating performance growth.
In terms of leadership changes, the company's board of directors and committees have seen some changes, including the appointment of new non-executive directors and the retirement of board members.
IMB is also committed to reducing carbon emissions. Since the base year of 2017, direct carbon emissions have decreased by 69%, with the goal of achieving net zero emissions by 2040.
The company's CEO Stefan Bomhard stated that
In the coming year, based on fixed exchange rates, we expect low single-digit growth in net revenue from tobacco and NGP. The group's adjusted operating profit is projected to be close to the middle range of the mid-single-digit range. This will be driven by sustained growth in profits from our combustible tobacco business and further reduction in operating losses from the NGP product portfolio.
Since 2020, our NGP net revenue has grown by 64% based on current exchange rates, with NGP currently accounting for 4% of our total tobacco and NGP net revenue. By 2024, we expect to see growth in NGP net revenue in all categories and regions globally. The increase in performance in the United States can be attributed to the launch of our new Zone mouth nicotine pouches. In Europe, growth is primarily driven by our updated range of electronic cigarette products, including the new disposable blu bar and rechargeable blu bar kits. In AAACE, we are cultivating consumer loyalty through heated products, including our new iSenzia tea-based sticks.
To read the full report, please click here: Annual Report and Accounts 2024.
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