British American Tobacco (BAT) said on Thursday it expected full-year revenue growth of between 2 per cent and 4 per cent at constant currency rates, as more people are using its e-cigarettes and oral nicotine products. Price increases and boosted marketing would offset higher raw material prices, it said.
BAT forecast mid-single digit adjusted diluted earnings per share growth on a constant currency basis for the year ending December 31st.
The Lucky Strike cigarette maker also expects “strong adjusted operating margin improvement despite increasing inflation in our supply chain”.
BAT estimated that 3.2 million more consumers began using its non-combustible products in the first nine months of the year, bringing the total number of users to about 21.5 million people.
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It said US consumers are increasingly switching to lower-priced cigarette brands as higher living costs reduce disposable income.
The company forecast global tobacco industry volumes to decline about 2 per cent after sales improved in emerging markets. Previously BAT forecast a 3 per cent drop.
The company added that sales of its combustible cigarette brands were flat in the third quarter but did not provide a full-year sales forecast for that business. – Reuters/Boomberg
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