British American Tobacco has seen its smoking alternatives take off, as the new products brought in £883m alone and customers increased at their highest rate yet.
Its smoking alternatives like vape, tobacco heating and modern oral products brought in more than 40 per cent more revenue in the six months to 30 June than in the same period in 2020.
Shares opened slightly higher this morning, up 0.1 per cent at a total share price of 2,774.50.
The cigarette company reported a £12.1bn revenue across all its products, which was down a slight 0.8 per cent from 2020.
British American Tobacco (BAT) was able to shave down its borrowings in the six months, down over 10 per cent to some £45bn.
Vaping has been gaining popularity, particularly among the younger generation, for a few years now.
BAT’s vapour products alone saw its revenue surge 59 per cent, as growth in its newest products buoyed the firm.
“This has been an exciting period of growth in new categories, with new category constant currency revenue up by 50 per cent in the first half,” tobacco boss Jack Bowles said.
“We added 2.6m consumers, our highest ever increase, to our non-combustible product consumer base, to reach 16.1m.”
The boss added that the growth seen in its new smoking alternatives has driven scale opportunities for the firm.
Equity analyst at Hargreaves Lansdown William Ryder said: “There’s still some way to go towards the £5bn target by 2025, but management thinks the group is on track.
“In some markets growth was very impressive, such as the Europe and North Africa region where new categories revenue more than doubled.”