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BAT first half trading in line but currency translation headwind to limit full-year growth

The FTSE 100-listed firm said exchange rates would reduce its earnings per share growth by 9% for the first half of the year and by 6% for the full year, at current spot rates
Cigarettes
The cigarette maker also repeated its view that adjusted revenue and profit growth would be weighted to the second half of the year

British American Tobacco plc (LON:BATS) has said its business continues to perform well with trading in the first half in line with its expectations, although a currency translation headwind is likely to limit full-year growth.

In a trading update on ahead of its half-year results, the FTSE 100-listed firm said exchange rates would reduce its earnings per share growth by 9% for the first half of the year and by 6% for the full year, at current spot rates.

READ: BAT aims to more than double its revenue from Next Generation smoking products by end 2018

The cigarette maker also repeated its view that adjusted revenue and profit growth would be weighted to the second half of the year, due to several items affecting its first-half comparisons.

The firm said its volumes continue to outperform the global industry rate which it expects will show around a 3.5% full-year decline.

It added that it expects its market share to continue to grow strongly, driven by its four Global Drive Brands of cigarettes – Dunhill, Kent, Lucky Strike and Pall Mall.

Next-generation products

BAT said the growth of next-generation Tobacco Heating products has slowed in Japan, although its glo device continues to grow and has a national share of 4.3%.

It added that with device supply constraints now lifted, it is on track for further Japanese and international rollouts in the second half.

The group said its vapour business continues to grow, with the Vype ePen3 on track for a launch in the UK in the third quarter.

The firm said in its AGM statement in April that it aims to more than double its revenue from Next Generation smoking products to substantially more than £1bn by the end of 2018,

BAT is scheduled to deliver its first-half results on July 26.

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