In Asia-Pacific, profit rose by £132 million to £804 million, mainly attributable to strong performances in Pakistan, Vietnam, Bangladesh, Australia and Malaysia and also benefiting from favourable exchange rates. At constant rates of exchange, profit would have increased by £79 million or 12 per cent. Volumes at 153 billion were 5 per cent higher as good increases in Pakistan, Bangladesh and South Korea were partially offset by lower volumes in Vietnam, Malaysia and Sri Lanka.
Profit in Australia was up as a result of higher margins and exchange rate movements, partially offset by the impact of increased competitor discounting activities. In New Zealand, profit improved, benefiting from price rises, cost efficiencies and exchange movements. Volumes in Australia and New Zealand were similar to last year, but both Dunhill and Pall Mall increased market share.
In Malaysia, strong profit growth was achieved as a result of price increases, a better product mix and continued productivity savings. Dunhill and Pall Mall grew market share, with good results from Kent after its relaunch in August 2008. Volumes were lower due to the overall industry decline, the high levels of illicit trade and another significant excise increase during the third quarter of 2008.
In Vietnam, strong profit growth was achieved through higher prices, a solid performance in the premium segment and cost saving initiatives. Volumes were down due to lower industry volumes, although market share increased strongly with outstanding performances from Craven ‘A’, Dunhill and State Express 555.
Volumes in South Korea were higher than last year and market share was up as a result of the good performance from Dunhill. Good profit growth was achieved through higher margins, increased volumes and an improved product mix, partially offset by the weakening of the currency.
In Taiwan, volumes were slightly down despite the significant growth of Dunhill. Profit was lower, adversely impacted by the marketing investment behind Dunhill.
In Pakistan, volume and market share continued to grow strongly. The volume growth, coupled with higher prices, resulted in a profit increase, however, this was more than offset by the weakening of the currency.
In Bangladesh, strong growth in volumes, price increases and a better product mix resulted in an impressive increase in profit.
Profit in Sri Lanka was well ahead, benefiting from price rises, a better product mix and continued productivity improvements. Volumes were lower, although overall market share grew with the good performances of Dunhill and Pall Mall.