Revenues were up but profits were down in a mixed bag of results for the Big Four cigarette maker British American Tobacco (BAT).
Turnover at the Pall Mall and Dunhill maker was up by 4.2 per cent reaching £6.7bn in the six months to 30 June.
However, adjusted profit from operations were down 2.2 per cent, reaching £2.5bn, while operating profit dipped 5.7 per cent to £2.2bn.
Basic earnings per share were one per cent higher at 143.8p, while adjusted earnings per share (EPS) were up 10.9 per cent to 111.1p.
The company has announced an interim dividend of 51.3p, being one third of the 2015 dividend, a four per cent increase on last year, to be paid on 28 September.
BAT's share price was up 1.2 per cent in morning trading to 4,803p.
[stockChart code="BATS" date="2016-07-28 09:11"]
Why it's interesting
The company posted strong growth in all four of its operating regions, with standout levels in Europe and Eastern Europe, Middle East and Africa (EMEA).
Growth was driven by a surge in sales of traditional, combustible cigarettes, with record performance in the company's five global drive brands, which include Dunhill and Rothmans.
Jerry Abelman, BAT's head of external affairs, told City A.M. the plain packaging legislation introduced in the UK in May would not have a discernible impact on the group's sales, as the company's UK business makes up less than one per cent of global revenue and the "tobacco business has continued to thrive over five or six decades of increasing tobacco legislation".
BAT's Next Generation Products line of e-cigarettes and vaping products continued to show solid growth in the first half.
"The global vapour products category continues to grow at a significant rate and, following the geographic expansion of Vype, we are now present in the biggest vapour markets outside of the US," BAT said in a statement today.
Its Vype e-cigarette has reached nine per cent category retail share of market in the UK, as measured by AC Nielsen, and an estimated category retail share of eight per cent in Germany and five per cent in France.
What BAT said
Chairman Richard Burrows said:
The business has delivered strong organic growth in the first six months of the year. This is despite the significant adverse transactional impact of foreign exchange and the continued investment in our long-term future via our Next Generation Products portfolio.
With profit growth weighted to the second half of the year, we remain confident that we will deliver another year of good earnings growth at constant rates of exchange.