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E-cigarettes, oral nicotine driving growth at BAT

December 9, 2022

(Photo by Michael M. Santiago/Getty Images)

British American Tobacco on Thursday said it expects 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.

BAT forecast mid-single digit adjusted diluted earnings per share growth on a constant currency basis for the year ending Dec 31.

The Vuse e-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.

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.

“Our New Category business continues to drive strong volume, revenue and market share growth and has become a significant contributor to group performance,” said Jack Bowles, chief executive.

“Our exciting new product launches and innovations, supported by further geographic expansion, have enabled the addition of another 3.2mn consumers within our non-combustible franchise in the first nine months, reaching 21.5mn.

“We are investing in New Categories, driving sustainable growth, while making excellent progress in reducing operating losses. We expect growing contribution across all New Categories, and all regions in 2022. We are confident in delivering our targets of £5bn revenue, and profitability by 2025,” he said.