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Tobacco giant Imperial Brands will gives a further £1.1bn back to shareholders next year as it announced its trading remains on course to hit full year expectations.

Updating the market following the close of its financial year on 30 September, Imperial said trading for the year has remained in line with guidance, with growth in aggregate market share of top-five priority markets.

It saw strong tobacco pricing to drive constant currency net revenue and adjusted operating profit growth

Combustables will see three consecutive years of improved market share performance following several years of decline. The US, Spain and Australia are expected to show market share growth, more than offsetting declines in Germany and the UK.

Momentum also continues to build behind its next generation products (NGP), with net revenue growth across all categories.

Full-year NGP revenue growth has accelerated in the second half of the year, driven by strong growth in Europe. In all categories of next generation products - vape, heated tobacco and oral nicotine – the group has delivered a step-up in product and market launches during the year.

On a constant currency basis and including its former Russia business in the prior-year comparator, tobacco and NGP net revenue is expected to grow in the low single digits and group adjusted operating profit growth to accelerate to the lower end of our mid-single digit range.

Meanwhile, it has announced a further £1.1bn share buyback announced in its 2024 financial year, a 10% increase on the £1bn buyback in 2023.

Taking dividends and buyback together, it expects capital returns to shareholders will exceed £2.4bn in the coming fiscal year, representing around 17% of its current market capitalisation.

The group’s full year results for the twelve months ended 30 September 2023 will be announced on 14 November 2023.

Imperial shares are up 1.8% this morning to 1,608p after yesterday’s falls.

Morning update

Imperial rival British American Tobacco has announced a new non exec board member.

Murray Kessler will join the board of BAT an independent non-exec director and member of the nominations and remuneration Committees with effect from 6 November 2023.

Kessler previously held several senior positions including chief executive of Perrigo, CEO of Lorillard Tobacco Co and vice chair of Altria Group.

He also had a twelve-year career with Campbell Soup Company.

Commenting on the appointment, Luc Jobin, chair of the board, said: “I am pleased to welcome Murray Kessler to our board. Murray has extensive leadership experience in growing consumer product companies and managing regulated businesses and I am looking forward to his contribution as we accelerate our strategy to build A Better Tomorrow”.

On the markets this morning, the FTSE 100 has edged up 0.1% to 7,419.9pts.

Risers include Bakkavor, up 4.7% to 97.6p, Nichols, up 2.3% to 958p and Naked Wines, up 2.9% to 50.6p.

Fallers include Glanbia, down 1.3% to €15.06, THG, down 1.3% to 65p and Hotel Chocolat, down .08% to 128p.

Yesterday in the City

The FTSE 100 dropped 0.8% to 7,412.5pts, falling for the third consecutive day.

Imperial Brands and British American Tobacco were hit by Prime Minister Rishi Sunak’s announcement that he intended a rolling ban on tobacco sales for those currently aged 14, effectively banning tobacco sales outright for that generation.

Imperial fell back 2.8% to 1,580p, while BAT was down 1.7% to 2,463.5p.

Other fallers include Nichols, down 5.3% to 928p, PZ Cussons, down 2.3% to 136.6p, Greencore, down 1.8% to 70.5p, and Virgin Wines, down 1.1% to 45.5p.

The few risers included Premier Foods, up 0.5% to 116p and Cranswick, up 0.4% to 3,470p.