Tobacco giant Imperial Brands reported a sharp fall in profits for the year today following a £399m hit from its exit from Russia in March.
Operating profits at the maker of Gauloises and Davidoff cigarettes tumbled 14.7 per cent to £2.68bn in the year to the end of September, down from £3.15bn last year. The fall was exacerbated by a boost last year from the £281m disposal of its cigar division.
Adjusted operating profits rose 1.8 per cent to £3.69bn however as growth in sales offset a slowdown in its distribution arm.
Swings in currency prices sent revenues down 0.7 per cent despite a 1.3 per cent rise in tobacco revenues to £7.59bn and a 10.8 per cent rise in its “next generation products” to £208m.
In a statement today, boss Stefan Bomhard said the firm was now well placed to weather a potential slowdown in consumer spending this year as the macroeconomic environment worsened.
“Looking ahead, we are well positioned to deliver against the next phase of our five-year strategy..The additional investment and the actions we have taken during the initial two-year strengthening phase have built stronger foundations as we face into a more challenging macro-economic environment,” he said in a statement.
“We are well placed to build on our track record of delivery over the next three years, improving returns and creating sustainable growth in shareholder value.”
Shareholders have been delivered a boost in the past year with 1.5 per cent growth in dividends alongside an ongoing £1bn share buyback programme.