British American Tobacco said first quarter pre-tax profit fell 3% due to adverse currency rates against sterling, but that volumes rose 5%, on the back of acquisition of Ente Tabacchi Italiani last December.

For the three months to March 31, pre-tax profit dropped to £454m from £468m. Turnover climbed to £7.8bn from £5.9bn.

BAT said its global drive brands, Kent, Pall Mall, Lucky Strike and Dunhill were up 3%.

The company said its plan to merge its US tobacco-making arm Brown & Williamson with rival RJ Reynolds remains on track and should be completed around the middle of the year.