3rd Jun 2025 08:11
(Alliance News) - British American Tobacco PLC on Tuesday raised its revenue guidance for 2025 following a better-than-expected first-half performance.
The London-based cigarette and nicotine product maker now expects top-line growth to be within a 1% to 2% range for the first half and the full-year, compared to previous estimate of just 1%.
The company said this revenue increase will likely support 1.5% to 2.5% growth in adjusted profit from operations.
Looking further ahead, BAT said it is confident in delivering growth of 3% to 5% in revenue and 4% to 6% in adjusted profit from operations in 2026.
The maker of Dunhill and Lucky Strike cigarettes said expects its US business to return to revenue and profit growth in the first half and in all of 2025, driven by strengthening combustibles delivery and an "excellent" Velo Plus performance.
By region, Africa & Middle East continued strong performance in the first six months of 2025, BAT said, but Asia Pacific, Middle East & Africa was hit by excise duties and regulatory challenges in Bangladesh and Australia.
BAT predicted low-single digit revenue growth in new categories in the first half, with the impact of illicit Vapour products in the US and Canada partly offsetting "excellent" Velo performance.
Velo in Modern Oral is the fastest growing new category segment, it added.
"2025 is a deployment year and, as previously highlighted, we expect our performance to be H2 weighted, mainly driven by the roll-out of new category innovations in key markets from the middle of the year," BAT Chief Executive Officer Tadeu Marroco said.
BAT said it is committed to deliver progressive dividend and a sustainable share buyback programme.
The company expects "translational" currency headwind of 4% on half-year and full-year adjusted profit from operations.
It expects global tobacco industry volume to be down 2% in 2025.
BAT shares were down 0.1% to 3,339.00 pence early Tuesday in London.
By Artwell Dlamini, Alliance News reporter
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