FX a drag at British American Tobacco

Cigarettes and tobacco maker British American Tobacco (BAT) said it has made a 'good start to 2013' after managing to increase revenues in the first quarter despite a slip in volumes.

Cigarettes and tobacco maker British American Tobacco (BAT) said it has made a 'good start to 2013' after managing to increase revenues in the first quarter despite a slip in volumes.

Revenues grew by 5.0% at constant exchange rates in the three months to March 31st, which Chief Executive Nicandro Durante said was "good" amidst a backdrop of "fragile economic conditions persisting in many parts of the world".

At current exchange rates however, revenues were up by just 1.0%. Nevertheless, the firm said that if current exchange rates persist for the rest of the year, "the currency headwind that adversely impacted the quarter will reverse".

BAT said that its Global Drive Brands of Dunhill, Kent, Lucky Strike and Pall Mall have seen continued growth with cigarette volumes up 1.0% year-on-year as market share grew strongly in the company's top 40 markets.

However, group cigarette volumes fell 3.7% to 160bn as growth in many markets (including Bangladesh, Pakistan and Vietnam) was more than offset by lower volumes in Brazil due to trade inventory movements, the leap-year comparator and market declines in Southern Europe.

Tobacco products meanwhile performed well during the quarter, with Fine Cut tobacco seeing strong growth in Western Europe.

Durante said: "We have grown revenue, our pricing momentum remains strong and our Global Drive Brands continue to perform well. It is a good start and I remain confident of another year of earnings growth in line with our long-term strategic goals."

Recommended

Share tips of the week – 24 September
Share tips

Share tips of the week – 24 September

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
24 Sep 2021
Three strong Asian stocks trading at bargain prices
Share tips

Three strong Asian stocks trading at bargain prices

Professional investor Nitin Bajaj of the Fidelity Asian Values investment trust picks three stocks that dominate their industries, earn good returns o…
20 Sep 2021
Why it pays to face up to your investment mistakes
Investment strategy

Why it pays to face up to your investment mistakes

Buying stocks can be a complicated business. But selling stocks can be tricky, too – even if you sell for the right reasons. Max King explains how to …
17 Sep 2021
Share tips of the week – 17 September
Share tips

Share tips of the week – 17 September

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
17 Sep 2021

Most Popular

A nightmare 1970s scenario for investors is edging closer
Investment strategy

A nightmare 1970s scenario for investors is edging closer

Inflation need not be a worry unless it is driven by labour market shortages. Unfortunately, writes macroeconomist Philip Pilkington, that’s exactly w…
17 Sep 2021
Two shipping funds to buy for steady income
Investment trusts

Two shipping funds to buy for steady income

Returns from owning ships are volatile, but these two investment trusts are trying to make the sector less risky.
7 Sep 2021
Should investors be worried about stagflation?
US Economy

Should investors be worried about stagflation?

The latest US employment data has raised the ugly spectre of “stagflation” – weak growth and high inflation. John Stepek looks at what’s going on and …
6 Sep 2021