Imperial Brands 1st Half Profit Soared Amid Higher Demand for Wholesale Tobacco -- Update

By Matteo Castia

--Imperial Brands reported a sharp rise in pretax profit for the first half of fiscal 2021 on higher revenue

--While travel restrictions hurt the duty-free business, the pandemic boosted wholesale

--The company's profitability also benefited from the disposal of the premium cigar division and lower amortization and impairment

Imperial Brands PLC reported Tuesday a sharp rise in pretax profit for the first half of fiscal 2021, boosted by rising revenue from changing consumer habits amid the coronavirus pandemic.

The tobacco group--which houses Davidoff, Gauloises and JPS among its brands--made a pretax profit of 2.06 billion pounds ($2.91 billion) for the six months ended March 31, compared with GBP785 million in the year-earlier period.

The company said that, while travel restrictions hurt its duty-free business, the pandemic has boosted wholesale sales to meet increasing pantry loading demand. All in all, pandemic-related changes to consumer buying patterns has continued to be a net benefit to revenue, it said.

Revenue rose to GBP15.57 billion from GBP14.67 billion a year earlier.

Operating profit, one of the company's preferred metrics, jumped to GBP1.64 billion from GBP925 million the prior year, driven primarily by profit on the disposal of the premium cigar division worth GBP281 million and a reduction in amortization and impairment of acquired intangibles worth GBP225 million, the FTSE 100 company said.

The board declared an interim dividend of 42.12 pence, a 1% increase on year in line with the group's progressive dividend policy.

Shares at 0835 GMT were up 16.5 pence, or 1%, at 1,606.5 pence.

Write to Matteo Castia at [e-mail]

(END) Dow Jones Newswires

May 18, 2021 05:06 ET (09:06 GMT)

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