THE SECOND-BIGGEST tobacco firm in the world proved that most of its customers are happy to pay higher prices for cigarettes yesterday, as it said revenues had risen despite falling volume sales.
British American Tobacco (BAT), the firm behind Lucky Strike, Dunhill, Kent and Pall Mall, said that in the first quarter of the year, price hikes had driven a one per cent rise in revenues. This was despite a 3.4 per cent fall in the amount of tobacco it sold.
With the negative effect of currency changes factored out, revenues were up five per cent.
Nicandro Durante, the FTSE 100 firm’s chief executive, said the start of the year was “a good performance against a backdrop of fragile economic conditions” and pointed to the success of BAT’s four key brands, which saw volume sales up by one per cent. “It is a good start and I remain confident of another year of earnings growth,” Durante said.
The company saw growth in the Asia-Pacific region, driven by gains in Indonesia and South Korea, while its biggest market – Eastern Europe, the Middle East and Africa, was steady.