The Group grew revenue by 17 per cent in very difficult times, to £14,208 million. This was the result of favourable exchange rate movements, good pricing momentum, volume from acquisitions made in the middle of 2008 (Skandinavisk Tobakskcompagni (ST) and Tekel) and the acquisition of Bentoel in June 2009. Revenue increased by 10 per cent at constant rates of exchange. All the regions contributed to this good result.
The reported profit from operations was 15 per cent higher at £4,101 million. Adjusted profit from operations was 20 per cent higher and would have been up 10 per cent at constant rates of exchange, despite the adverse transactional impact of exchange rates on costs.
Group volumes from subsidiaries were 724 billion, an increase of 1 per cent, as a result of the acquisitions of ST, Tekel and Bentoel. Market shares increased in a number of markets but, on an organic basis, volumes were down 3 per cent mainly as a result of deteriorating economies which led to declines in the total size of a number of markets and, in some markets, down-trading and an increase in illicit trade. Good volume growth in Bangladesh, South Korea, Vietnam, Uzbekistan, Nigeria, Egypt and the Gulf Cooperation Council (GCC) was more than offset by declines in Malaysia, Japan, Brazil, Mexico, Argentina, Venezuela, Italy, Russia, Ukraine, Romania and South Africa.
Despite market size declines in many countries, the four Global Drive Brands achieved good overall volume growth of 4 per cent and improved share in a number of markets. Just over half of the growth was contributed by brand migrations. Although there was pressure on the premium segment, Dunhill grew market share in all its key markets, except in Taiwan, while Kent increased market share in its main markets, apart from Japan.
Kent volumes fell by 4 per cent mainly as a result of industry declines in Russia and Japan, its principal markets and despite a higher market share in Eastern Europe and an increased premium segment share in Russia. Volumes grew in Kazakhstan, Ukraine, Uzbekistan and Azerbaijan, while they were slightly down in Romania. Dunhill rose by 9 per cent, mostly driven by a brand migration in Brazil, with growth in South Korea, the GCC, South Africa and Russia, partially offset by declines in Malaysia, Taiwan and Australia.
Lucky Strike volumes were 4 per cent higher with growth in Germany, France, Italy and Chile, partially offset by declines in Spain, Japan and Argentina, largely as a result of the industry volume decline. Market share grew well across all its key markets. Pall Mall volumes increased by 10 per cent with growth in Germany, Uzbekistan, Spain, Mexico, Chile and Turkey, partially offset by lower volumes in Pakistan, Russia, Romania and Hungary.