Tobacco keeps king sized revenues rolling in

Price rises in the first nine months of the year helped it to offset a three per cent fall in total tobacco volumes.

The world’s second largest cigarette maker, whose brands include Kent, Dunhill, Lucky Strike and Pall Mall, said it had recorded revenue growth for the period to the end of September of 0.7 per cent, year-on-year, at current rates of exchange.

Revenue at constant exchange rates grew by 3.5 per cent, helped by the price increases. Movements in some of the firm’s key trading currencies adversely affected the group.

The reduction in volumes was due to lower demand in Brazil, Russia, Turkey, Ukraine, Egypt and Western Europe, which offset the growing popularity of its brands in markets such as Bangladesh, Pakistan, Vietnam and the Middle East.

Of its brands, Dunhill and Pall Mall performed well while Kent and Lucky Strike fell in terms of volumes.

“The group continued its good performance against a backdrop of adverse exchange rate movements, lower industry volume and instability in some parts of the world,” chief executive Nicandro Durante said.

“We remain on track for a year of solid earnings growth.”

To counter the number of people who want to give up smoking around the world, BAT, in common with other cigarette groups, has introduced an electronic cigarette – a battery-powered metal device that turns nicotine-laced liquid into vapour which looks like the real thing but is much safer.

BAT said it had seen encouraging signs for its version of the new cigarette, called Vype.

The company has 44 cigarette factories in 39 countries and it employs more than 55,000 people worldwide.

In 2012, BAT’s subsidiary companies sold 694 billion cigarettes.