6th Nov 2018 08:29
LONDON (Alliance News) - Imperial Brands PLC on Tuesday said its profit dipped very slightly in its most recent year after its UK distributor went into administration.
In its financial year ended September 30, the tobacco company posted a pretax profit of GBP1.82 billion, largely unchanged from its GBP1.86 billion profit the year before.
The company experienced a one-off GBP110 million hit from its Palmer & Harvey UK distributor going into administration in November 2017, but it was largely able to offset this by cutting administrative expenses to GBP1.60 billion from GBP1.72 billion.
Imperial Brands increased its annual dividend payment by 10% to 187.8 pence from 170.7p year-on-year.
Revenue increased to GBP30.52 billion from GBP30.25 billion the prior year.
In its new 2019 financial year, the tobacco company expects to deliver constant currency revenue growth at, or over, the upper end of its 1% to 4% estimate.
A further GBP100 million investment increase in Blu, Imperial Brands' e-cigarette brand, will be made in the first half of financial 2019 "to support further revenue acceleration", which is likely to lower adjusted operating profit in that period. Imperial Brands expects this to be "more than offset" in the second half of its 2019 year.
Medium-term guidance for constant currency earnings per share growth of between 4% and 8% remains, with Imperial Brands' Next Generation Products business, which includes e-cigarettes, likely to contribute to profit upon exiting the 2019 financial year.
Imperial Brands Chief Executive Alison Cooper said the main focus of the company's Next Generation Products business is on "transitioning smokers to blu", with an international rollout of the myblu brand putting it "in a strong position to further invest and accelerate sales growth" in Imperial Brands' financial 2019 year.
"We have the strategy, assets and capabilities to realise the significant opportunities presented by a changing environment and to generate growing returns for our shareholders," said Cooper.
Shares in Imperial Brands were up 2.0% at 2,695.00p on Tuesday morning in London.
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