BATS on Track for Another Year of Good Earnings Growth

By Razak Musah Baba

LONDON--British American Tobacco PLC (BATS.LN) is on track for another year of good earnings growth, the company said Thursday, after recording a slight rise in net profit despite the effects of adverse currency transaction and investments.

The Dunhill, Lucky Strike and Pall Mall cigarettes brand owner's net profit during the six months ended June 30 rose 1% to 2.67 billion pounds ($3.51 billion) compared with GBP2.65 billion a year earlier after reported revenue rose 4.2% to GBP6.67 billion from GBP6.40 billion. The company said the revenue was driven by a strong volume performance and good pricing.

Group cigarette volume was 332 billion, an increase of 3.4% on the same period last year, or 2.1% on an organic basis.

"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," Chairman Richard Burrows said.

"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," Mr. Burrows said.

Write to Razak Musah Baba at [e-mail]; Twitter: @Raztweet

(END) Dow Jones Newswires

July 28, 2016 03:05 ET (07:05 GMT)

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