| Wed 28 Apr 2010, 8:00 | | BTI - British American Tobacco p.l.c. - Interim Management Statement for the |
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BTI
BTI
BTI - British American Tobacco p.l.c. - Interim Management Statement for the
Three Months Ended 31 March 2010
British American Tobacco p.l.c.
Incorporated in England and Wales
(Registration number: 03407696)
Short name: BATS
Share code: BTI
ISIN number: GB0002875804
("British American Tobacco p.l.c." or "the Company")
28 April 2010
INTERIM MANAGEMENT STATEMENT FOR THE THREE MONTHS ENDED 31 MARCH 2010
Solid revenue growth at constant exchange rates, further
enhanced by translation exchange rates
Volumes from subsidiaries decreased by 1 per cent to 168
billion, organic volumes down by 4 per cent
Global Drive Brands volume grew by 6 per cent
SUMMARY OF PERFORMANCE
Trading update
British American Tobacco performed well in the three months to the end of
March, although total volumes were slightly lower.
Group revenue for the three months grew in constant currency terms, driven by
continued strong pricing momentum and the acquisition of PT Bentoel
Internasional Investama Tbk (Bentoel) in Indonesia on 17 June 2009. All
regions grew revenue at constant rates of exchange with particularly strong
performances from Africa and Middle East and Americas. Revenue benefited
further from the favourable impact of exchange rate movements.
Group volumes from subsidiaries were 168 billion, down 1 per cent from 170
billion in 2009, while organic volumes were 4 per cent lower, in line with the
decline in market sizes. Significant industry volume declines in markets such
as Brazil and Romania, where Group market share grew, and in Ukraine and
Japan, where market share was maintained, drove this volume decline. The
adverse impact on Group volumes was highest in the low-priced segment. First
quarter volumes benefited from the acquisition of Bentoel.
The four Global Drive Brands delivered a good performance and achieved overall
volume growth of 6 per cent and share growth in a number of key markets.
Dunhill was up 24 per cent, helped by the migration of Carlton to Dunhill in
Brazil, while Lucky Strike grew by 8 per cent and Pall Mall by 10 per cent,
respectively. Kent volumes were 12 per cent lower mainly driven by industry
volume declines in Japan, Russia and Romania, despite growing or maintaining
market share in those markets.
Market share in our top 40 markets was in line with the start of 2009 and
ahead of our Q4 2009 share.
Trading environment
This good performance was achieved against lower industry volumes in a number
of important markets, such as Japan, Brazil, Russia, Romania and Turkey. The
general economic environment with rising levels of unemployment, together with
increases in excise, resulted in continued pressure on the premium segment and
in some markets, particularly in Central and Eastern Europe, there was down-
trading to illicit trade, affecting the low price segment.
The Group continued to address its cost base and, amongst other initiatives,
finalised the consultation process with a view of consolidating the sales and
marketing organisations in the Benelux markets as well as entering information
and consultation on the future of the Jawornik factory in Poland.
Cigarette volumes
The segmental analysis of the volumes of subsidiaries is as follows:
3 months to Year to
31.03.10 31.03.09 31.12.09
bns bns bns
Asia-Pacific 45 43 185
Americas 38 38 151
Western Europe 29 30 130
Eastern Europe 25 27 131
Africa and Middle 31 32 127
East
168 170 724
Bentoel grew volumes and share in Indonesia and contributed 5 billion sticks
to the Asia-Pacific region.
Comment
Paul Adams, Chief Executive, commented "Our consumers are clearly finding
economic conditions difficult and volumes suffered as a result of market size
declines. However, there was continued pricing momentum and good growth in
market shares, leading to solid revenue growth. We remain on track for the
year."
CHANGES IN THE GROUP
On 17 June 2009, the Group acquired an 85 per cent stake in Indonesia`s fourth
largest cigarette maker PT Bentoel Internasional Investama Tbk (Bentoel). A
public tender offer for the remaining shares was completed by 26 August 2009,
resulting in the acquisition of a further 14 per cent share in the company,
bringing the total shareholding in the Bentoel Group to 99.7 per cent.
On 20 October 2009, it was announced that Bentoel and BAT Indonesia had
decided to enter into a merger plan whereby BAT Indonesia will merge into
Bentoel. The merger was completed under the Bentoel name and the company
remains listed on the Indonesian Stock Exchange.
FINANCIAL POSITION
The Group has sufficient financing and facilities available for the
foreseeable future and at 31 March 2010 its guaranteed revolving credit
facility of GBP1.75 billion was undrawn. This facility also acts as a
backstop for the Group`s euro commercial paper (ECP) programme (GBP1 billion)
of which GBP232 million was outstanding on 31 March 2010.
There have been no changes in financing arrangements since the beginning of
the financial year.
There have been no material events, transactions or change in the financial
position of the Group since the year end, other than as outlined in this
statement. Further, the Board is not aware of any material events,
transactions or change in the financial position of the Group which have
occurred since 31 December 2009 up to and including 27 April 2010, being the
latest practicable date before the date of the publication of this Interim
Management Statement.
On behalf of the Board
Nicola Snook
Secretary
27 April 2010
NOTES AND ADDITIONAL INFORMATION
British American Tobacco is the world`s second largest quoted tobacco group by
global market share, with brands sold in more than 180 markets. We have four
Global Drive Brands - Dunhill, Kent, Lucky Strike and Pall Mall - and over 300
brands in our portfolio. We hold robust market positions in each of our
regions and have leadership positions in more than 50 markets.
Disclaimers
This Interim Management Statement (IMS) relates to the three months ended 31
March 2010 and contains information that covers the first quarter and the
period since the quarter end to 27 April 2010, being the latest practicable
date before the date of the publication of this IMS.
This announcement does not constitute an invitation to underwrite, subscribe
for, or otherwise acquire or dispose of any British American Tobacco p.l.c.
shares or other securities.
This IMS contains certain forward looking statements which are subject to risk
factors associated with, among other things, the economic and business
circumstances occurring from time to time in the countries and markets in
which the Group operates. It is believed that the expectations reflected in
this announcement are reasonable but they may be affected by a wide range of
variables which could cause actual results to differ materially from those
currently anticipated.
Past performance is no guide to future performance and persons needing advice
should consult an independent financial adviser.
Distribution of this Interim Management Statement (IMS)
The IMS is released to the London Stock Exchange and the JSE Limited. It may
be viewed and downloaded from our website, www.bat.com
Copies of the IMS may also be obtained during normal business hours from: (1)
the Company`s registered office; (2) the Company`s representative office in
South Africa; and (3) British American Tobacco Publications, details of which
are given below.
FINANCIAL CALENDAR 2010
6 May Payment date of 2009 final dividend
28 July Half-Yearly Report
27 October Interim Management Statement
CORPORATE INFORMATION
Premium listing
London Stock Exchange (Share Code: BATS; ISIN: GB0002875804)
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Secondary listing
JSE (Share Code: BTI)
Shares are traded in electronic form only and transactions settled
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American Depositary Receipts (ADRs)
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Sponsored ADR programme; each ADR represents two ordinary shares of British
American Tobacco p.l.c.
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tel: 1-888-985-2055 (toll-free) or +1 781 575 4555
e-mail enquiries: Citibank@shareholders-online.com
website: www.citi.com/dr
Publications
British American Tobacco Publications
Unit 80, London Industrial Park, Roding Road, London E6 6LS, UK
tel: +44 (0)20 7511 7797; facsimile: +44 (0)20 7540 4326
e-mail enquiries: bat@team365.co.uk or
Computershare Investor Services (Pty) Ltd in South Africa using the contact
details shown above.
British American Tobacco p.l.c.
Registered office
Globe House
4 Temple Place
London
WC2R 2PG
tel: +44 (0)20 7845 1000
British American Tobacco p.l.c.
Representative office in South Africa
34 Alexander Street
Stellenbosch
7600
South Africa
(PO Box 631, Cape Town 8000, South Africa)
tel: +27 (0)21 888 3722
ENQUIRIES:
INVESTOR RELATIONS: PRESS OFFICE:
Ralph 020 7845 1180 David Betteridge/Kate 020 7845 2888
Edmondson/ 020 7845 1977 Matrunola/
Maya Farhat Catherine Armstrong
28 April 2010
Sponsor: UBS South Africa (Pty) Ltd
Date: 28/04/2010 08:00:06 Produced by the JSE SENS Department.
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