Imperial Brands reported a rise in annual sales after demand for tobacco picked back up amid the pandemic.
The maker of Gauloises and JPS reported revenue for the year to 30 September rose from £31.59bn to £32.56bn.
Imperial Brands made a pretax profit of £2.17bn, up from £1.69bn in the previous year, which included £90m in coronavirus-related costs and £50m of regulatory and compliance costs.
The jump in sales was in part due to a pick up in demand for tobacco which offset a drop off in e-cigarette sales.
Stefan Bomhard, who took over as chief executive in July said: “I believe thereis scope to enhance returns from our tobacco business and opportunities to strengthen our NGP delivery over time. I firmly believe we can make a meaningful contribution to harm reduction within a more disciplined, returns-focused framework and we have already taken steps to stem the NGP losses.”
The board declared a final dividend of 48.0 pence per share, bringing the full year payout to 137.71 pence. It is down from 2019’s 206.57 pence per share full-year dividend after Imperial Brands revised its dividend policy and lowered payouts by a third in May.
Imperial said it expects further progress in 2021 and even against the backdrop of the pandemic it expects to “deliver low to mid-single digit growth in organic adjusted operating profit”. It anticipates tobacco pricing to remain strong but the “duty free channel is likely ot remain depressed for much of the year.”
Operating costs are also expected to track higher to reflect the higher regulatory costs and manufacturing “inefficiencies” caused by coronavirus.
Shares were up 3.17 per cent in early trading.