Multi-category strategy delivers growth in difficult times
KEY NON-FINANCIAL PERFORMANCE INDICATORS1 | |
---|---|
Cigarette and THP volume share | |
2020 Current rates | - |
2020 Constant rates | - |
Change vs 2019 Current rates | +50 bps |
Change vs 2019 Constant rates | - |
Cigarette and THP value share | |
2020 Current rates | - |
2020 Constant rates | - |
Change vs 2019 Current rates | +20 bps |
Change vs 2019 Constant rates | - |
Non-Combustibles consumers | |
2020 Current rates | 11.6m |
2020 Constant rates | - |
Change vs 2019 Current rates | +1.1m |
Change vs 2019 Constant rates | - |
KEY FINANCIAL PERFORMANCE INDICATORS IFRS | |
Revenue | |
2020 Current rates | £12,271m |
2020 Constant rates | - |
Change vs 2019 Current rates | +0.8% |
Change vs 2019 Constant rates | - |
Profit from operations | |
2020 Current rates | £5,097m |
2020 Constant rates | - |
Change vs 2019 Current rates | +16.4% |
Change vs 2019 Constant rates | - |
Operating margin | |
2020 Current rates | 41.5% |
2020 Constant rates | - |
Change vs 2019 Current rates | +550 bps |
Change vs 2019 Constant rates | - |
Effective tax rate | |
2020 Current rates | 23.0% |
2020 Constant rates | - |
Change vs 2019 Current rates | -210 bps |
Change vs 2019 Constant rates | - |
Basic earnings per share (EPS) | |
2020 Current rates | 151.2p |
2020 Constant rates | - |
Change vs 2019 Current rates | +22.7% |
Change vs 2019 Constant rates | - |
Diluted EPS | |
2020 Current rates | 150.7p |
2020 Constant rates | - |
Change vs 2019 Current rates | +22.7% |
Change vs 2019 Constant rates | - |
Net cash generated from operating activities | |
2020 Current rates | £3,484m |
2020 Constant rates | - |
Change vs 2019 Current rates | +52.3% |
Change vs 2019 Constant rates | - |
Cash conversion | |
2020 Current rates | 68% |
2020 Constant rates | - |
Change vs 2019 Current rates | +1,600 bps |
Change vs 2019 Constant rates | - |
Borrowings | |
2020 Current rates | £50,461m |
2020 Constant rates | - |
Change vs 2019 Current rates | +0.3% |
Change vs 2019 Constant rates | - |
Non-GAAP: | |
Adjusted revenue | |
2020 Current rates | £12,271m |
2020 Constant rates | £12,434m |
Change vs 2019 Current rates | +1.1% |
Change vs 2019 Constant rates | +2.4% |
Adjusted profit from operations | |
2020 Current rates | £5,368m |
2020 Constant rates | £5,379m |
Change vs 2019 Current rates | +3.1% |
Change vs 2019 Constant rates | +3.3% |
Adjusted operating margin | |
2020 Current rates | 43.7% |
2020 Constant rates | 43.3% |
Change vs 2019 Current rates | +80 bps |
Change vs 2019 Constant rates | +40 bps |
Underlying tax rate | |
2020 Current rates | 25.0% |
2020 Constant rates | 24.9% |
Change vs 2019 Current rates | -160 bps |
Change vs 2019 Constant rates | -170 bps |
Adjusted diluted EPS | |
2020 Current rates | 157.8p |
2020 Constant rates | 159.1p |
Change vs 2019 Current rates | +5.7% |
Change vs 2019 Constant rates | +6.6% |
Adjusted cash generated from operations (ACGFO) | |
2020 Current rates | £2,806m |
2020 Constant rates | £2,719m |
Change vs 2019 Current rates | +91% |
Change vs 2019 Constant rates | +85% |
Operating cash conversion | |
2020 Current rates | 80% |
2020 Constant rates | - |
Change vs 2019 Current rates | +1,400 bps |
Change vs 2019 Constant rates | - |
Adjusted net debt | |
2020 Current rates | £44,237m |
2020 Constant rates | - |
Change vs 2019 Current rates | -2.8% |
Change vs 2019 Constant rates | - |
Jack Bowles, Chief Executive said:
'The business is performing well in difficult circumstances as our continued focus on our three key priorities2 has enabled us to rapidly adapt to the current environment.
-
We are building A Better Tomorrow
- 10% of our revenues come from non-combustible categories
- We are making good progress towards our target of 50 million non-combustibles consumers by 2030
- Invested an additional £250 million in New Categories marketing
-
We are continuing to deliver adjusted revenue, profit from operations and earnings growth at constant rates
- Strong cigarette price/mix (8.5%) reflects the strength of our differentiated brand portfolio
- Which offsets lower cigarette and THP volume (down 6.3%)
- And the impact of COVID-19 of approximately -4% on adjusted revenue in the first six-months of 2020
-
Multi-category consumer acquisition drives share growth
- Our Non-Combustibles consumer base increased to 11.6 million (up 1.1 million from December 2019), being an increase of 2.7 million consumers on a rolling 12 month basis from June 2019
- New categories revenue grew 12.7% (at constant rates)
- We are growing volume share in THP and value share in Vapour, with Modern oral adjusted revenue up 71% (at constant rates)
-
We are delivering excellent combustibles volume and value share growth
- Cigarette volume share (up 50 bps) and value share (up 20 bps)
- Driven by the strength of the Group's differentiated cigarette portfolio
- Strategic cigarettes and THP portfolio now accounts for 66% of total cigarettes and THP volume
- US cigarette volume share up 10 bps and value share up 30 bps
-
We are navigating COVID-19 supported by a diverse market footprint
- Consumption trends in Developed Markets (75% of Group adjusted revenue) remain robust, with good pricing and little evidence to date of accelerated down-trading
- In Emerging Markets, we are growing cigarette and THP volume share strongly, up 70 bps
- Volumes are strong where we see illicit trade reduction and can leverage our operational agility
- Weaker industry volume where there have been stricter lockdown measures (for instance South Africa)
- We continue to anticipate a full year headwind of around 3% from COVID-19 on constant currency adjusted revenue
-
We are committed
- We are on track to deliver against our 2020 guidance
- We maintain our medium-term post COVID-19 guidance of 3-5% constant currency adjusted revenue growth and high-single figure constant currency adjusted diluted EPS growth
- We are committed to our 65% dividend pay-out ratio
I would like to thank our staff, customers, partners and suppliers for working tirelessly through this difficult period. We expect the coming months to bring continued uncertainty. Nevertheless, we will continue to invest in accelerating our strategy. Building on our excellent momentum, we are confident that we will exit this crisis as a stronger and better business'
Half-year Report to 30 June 2020 (1.4 mb)
Enquiries
Press Office
+44 (0) 20 7845 2888 (24 hours) | @BATPress
Investor Relations
Mike Nightingale: +44 (0)20 7845 1180
Victoria Buxton: +44 (0)20 7845 2012
William Houston: +44 (0)20 7845 1138
John Harney: +44 (0)20 7845 1263
Attachments
- Original document
- Permalink
Disclaimer
British American Tobacco plc published this content on 31 July 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 31 July 2020 06:05:11 UTC