Imperial Brands Plc, the maker of Kool cigarettes and Blu vaping products, reported lower earnings due to Covid-19-related costs and said tobacco has benefited from consumers spending more on cigarettes.
- Earnings per share probably fell about 6% in the 12 months through September on a constant-currency basis, the company said ahead of its full report due in November.
- Imperial’s cigarette brands have been more resilient than vaping products during the pandemic. Revenue from alternatives to smoking plunged 30% as the company reduced investment in underperforming brands. Cigarette volumes have been better than expected as consumers spend less on vacation and leisure. Tobacco sales rose 1%.
- Chief Executive Officer Stefan Bomhard, who started in his position in July, faces the task of catching up with bigger rivals in next-generation products and gaining back investors’ trust after the stock lost more than half its value in about three years.
- The company is on track to complete the sale of its worldwide premium cigar business at the end of this month, after a delay attributed to the pandemic. Imperial has provided a six-month loan to the buyers as they finalize financing arrangements.
- Imperial shares have slumped 27% this year.
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