11th Feb 2016 09:21
LONDON (Alliance News) - Imperial Brands PLC on Thursday reported a rise in net revenue in the first quarter of its financial year and said it is on track to meet its full-year outlook.
The company, which recently changed its name from Imperial Tobacco, said tobacco net revenue at constant currencies was up 17% in the three months ended December 31, in line with its guidance, and up 10% on a reported basis, supported by a GBP226 million contribution from ITG Brands in the USA. However, total tobacco volume fell 3.0%, which it said was largely due to the turmoil in Iraq and Syria.
Growth Brands, which includes Davidoff and Lambert & Butler cigarettes, achieved an 11% rise in net revenue excluding Iraq and Syria, and a 7.3% uplift in volume, while its market share improved by 100 basis points. Including Iraq and Syria, however, Growth Brands volume increased by 0.4%.
Geographically, tobacco net revenue in Growth Markets declined 2.5%, but rose 7.2% excluding Iraq and Syria, while volume fell 11% and overall net revenue decreased by 10%. The group said Growth Markets continue to be hit by the conflict in Iraq and cessation of trading in Syria.
Imperial Brands said ITG Brands will continue to benefit results throughout the year and that the headwind from Iraq and Syria will lessen.
It added that it is continuing to target cash conversion of over 90% to fund deleveraging and dividends, and that it is on track to deliver full-year dividend growth of 10%.
"We continued to make good progress against our strategic objectives in the first quarter and are well placed to meet full-year expectations. We are further sharpening our focus on quality revenue growth and have advanced the simplification of our portfolio and prioritisation of profitable volume," Chief Executive Alison Cooper said in a statement.
Imperial Brands shares were trading down 0.3% at 3,508.00 pence Thursday morning, having been one of only four risers in the FTSE 100 at the open.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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