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(Alliance News) - British American Tobacco PLC on Wednesday said it continues to perform well, building on its accelerating momentum from the second half of 2020.
The cigarettes, tobacco and other nicotine products maker also expressed confidence in its previous 2021 guidance, confirming that it expects global tobacco industry volume to be down around 3%.
Constant currency revenue growth is still seen between 3% and 5%, and 65% dividend pay-out ratio and growth in sterling terms. BAT noted that it continues to expect a foreign currency exchange headwind of around 7% on full-year adjusted earnings per share growth.
In his statement to BAT's annual general meeting on Wednesday, Chair Richard Burrows commented on the US Food & Drug Administration's upcoming response to the menthol citizen petition on regulatory product standards. Burrows said any such regulation would be highly complex and could take many years to implement.
"We support regulation that is clearly founded on scientific evidence and which considers all unintended consequences," Burrows said.
He didn't comment a press report last week that the administration of US President Joe Biden is mulling cutting the amount of nicotine allowed in cigarettes to a level that is no longer addictive. The Wall Street Journal article had knocked the share prices of tobacco firms, including BAT's.
Turning to its operating activity so far in 2021, BAT reported good performance across all of its New Categories businesses. The company said it continues to see strong consumer acquisition, consumables volume growth and market share growth. BAT expressed confidence of meeting its GBP5 billion revenue target by 2025.
In Vapour, BAT said it continues to strengthen its positions across Canada and will complete the brand migration to Vuse by the end of the first half of 2021. In the US, Vuse's year-to-date value share has grown to 29.5%, up 4.6 percentage points on the year before.
Burrows steps down as chair at Wednesday's AGM, replaced by Luc Jobin.
BAT shares were trading 0.6% lower in London on Wednesday at 2,681.50 pence each, while in Johannesburg, the stock was up 0.8% at ZAR539.20 a share.
By Evelina Grecenko; evelinagrecenko@alliancenews.com
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