British American Tobacco - Half-year Report to 30 June 2015

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News Release

Half-year Report to 30 June 2015

29 July 2015

Good performance in a tough environment


Six months results - unaudited

Revenue £6,398m £6,962m £6,798m -5.9% +2.4%
Adjusted profit from operations* £2,507m £2,699m £2,665m -6.0% +1.3%
Profit from operations £2,347m £2,533m £2,458m -4.6% +3.0%
Adjusted diluted earnings per share* 100.2p 105.8p 101.8p -1.6% +3.9%
Basic earnings per share 142.4p - 93.3p +52.6% -
Interim dividend per share 49.4p - 47.5p +4.0% -
*The non-GAAP measures, including adjusting items and constant currencies, are set out on page 22 of the attached full announcement.


  • Group revenue was up by 2.4% at constant rates of exchange, driven by good pricing. Reported revenue was 5.9% lower, as a result of adverse exchange rate movements.
  • Adjusted Group profit from operations was ahead of prior year by 1.3% at £2,699 million at constant rates of exchange, but would have been significantly higher after adjusting for the effect of transactional foreign exchange. At current rates of exchange, adjusted profit from operations fell by 6.0%.
  • Profit from operations, at current rates of exchange, was 4.6% lower at £2,347 million.
  • Operating margin, at current rates of exchange, was maintained despite the significant transactional foreign exchange impact.
  • Adjusted diluted earnings per share, at constant rates of exchange, was up by 3.9%. At current rates, it was 1.6% lower at 100.2p.
  • Basic earnings per share was 52.6% higher at 142.4p (2014: 93.3p), benefiting from gains as a result of the acquisition of Lorillard Inc. by the Group’s associate Reynolds American Inc.
  • Group cigarette volume was 322 billion, a decline of 2.9% against an estimated industry decline of approximately 3.5%.
  • The Group’s cigarette market share in its Key Markets [1] continued to grow strongly [2], driven by the Global Drive Brands which increased volume by 6.0%.
  • The Group continued to invest in the future, concluding the previously announced investment of US$4.7 billion in cash in the enlarged Reynolds American Inc., announcing the proposed €550 million acquisition of TDR, progressing the possible offer for the shares in Souza Cruz not currently owned by the Group and strengthening the pipeline of Next Generation Products.
  • The Board has declared an interim dividend of 49.4p, being one third of the 2014 dividend, a 4.0% increase on last year. This will be paid on 30 September 2015.
[1] The Group’s Key Markets represent over 70% of the Group’s volume
[2] Key Market offtake share, as independently measured by AC Nielsen

Richard Burrows, Chairman, commenting on the 6 months ended 30 June 2015

“As we anticipated, the first half of the year has been impacted by adverse exchange rate movements and a strong first half volume comparator. The underlying performance of the business remains strong and we are confident that we are on course to deliver an improved second half, leading to another year of good earnings growth at constant rates of exchange. Underscoring our commitment to growing shareholder returns we intend to reflect this good underlying performance with an increase in the full year dividend.”

Half-year report to 30 June 2015 - Full announcement (1.1 mb) 


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