British tobacco company Imperial Tobacco Group Plc (IMT.L,ITYBY.PK), Tuesday, in an interim management statement, said that it has made a good start to the financial year ending September 30, 2010, with trading in line with the board's expectations, despite weak economic environment.
The Bristol, UK-based company operates mainly under two businesses: Tobacco and Logistics.
Imperial noted that cigarette volumes in Rest of European Union region have been particularly strong, and it maintained its growth momentum in Rest of the World region with further cigarette share gains in Africa, Middle East and Asia Pacific. In the first quarter, the company's international cigarette brand Davidoff grew share in its top five markets and both West and JPS also performed well.
In fine cut tobacco, the company delivered strong volume growth in UK, Germany and Rest of European Union region, and increased prices across its portfolio in various markets since the beginning of the financial year including UK, Spain and France, Imperial noted.
In Logistics business, the company said it has made a good start to the year despite the continued macro-economic difficulties in Spain, and is showing improved results with the benefit of cost saving initiatives.
UK Region
For the first quarter, annual duty paid cigarette market edged up 1% to 45.5 billion while duty paid fine cut tobacco market volumes increased 21% to 4,650 tonnes. Average cigarette share for the year to December was 45.2% as compared with 45.3% in the year-to-September 2009.
Imperial noted that on a monthly spot basis, its share has been on an upward trend since July 2009 and stood at 45.6% in December. In the year to December 2009, the company's fine cut tobacco share was 57.1% as compared to 58.0% in the year-to-September.
"Further to yesterday's announcement of the UK government's Tobacco Control Strategy, we remain strongly opposed to the plain packaging of tobacco products," the company said.
Making all tobacco products available in the same generic plain packaging will further fuel the growth in illicit trade and undermine the government's plans to increase investment in tackling smuggling and counterfeiting, the company added.
Spain Region
First quarter cigarette market volumes in Spain were down approximately 10% to 80.7 billion, whereas fine cut tobacco market volumes rose 30% to 5,150 tonnes. The company noted that since the duty on fine cut tobacco increased disproportionately to cigarettes in June 2009, the rate of growth has decreased considerably and as a result the company reduced its stock levels.
For the three-month period, Imperial's blonde cigarette share was 30.1% versus 30.6% in the year-to-September with Ducados Rubio performing well. In the first quarter, Imperial saw some improvement in cigar volumes.
Germany Region
For the three-month period, cigarette market volumes in Germany dropped 2% to 85.5 billion, while other tobacco products rose 11% to 37.8 billion cigarette equivalents. The company's cigarette share in the first quarter was 27.1% versus 27.3% in the year-ago September, reflecting competitor activity surrounding the move in minimum pack size from 17 to 19 cigarettes.
Rest Of European Union Region
In Rest of European Union region, French cigarette market volumes the quarter grew 3% to 55.0 billion and domestic blonde cigarette share was stable at 23.9%. Imperial increased the prices of all its cigarette brands by an average of 6% and fine cut tobacco brands by an average of 7.5% in November.
The company noted that elsewhere in the region, it increased volumes in both cigarette and fine cut tobacco, in spite of the difficult economic backdrop, and that performance in EU accession countries in Central Europe was particularly strong with cigarette and fine cut tobacco share rises in majority of markets.
Americas Region
First quarter cigarette market volumes in the US dropped nearly 9%, reflecting a substantial increase in Federal Excise Taxes or FET in April 2009. Imperial's cigarette share in the US was 4.1% as compared with 4.2% in the year-to-September 2009 and it increased prices by 60 cents a carton in October. Cigar volumes continue to be impacted by the increase in FET, but this was largely mitigated with the benefit of price increases, the company noted.
Rest of the World Region
Imperial noted that even though rest of the world regional volumes were affected temporarily by supply chain disruption in Middle East, it continued to build sales and achieved cigarette share gains in the majority of markets.
In Africa and Middle East region, the company grew cigarette share in almost all of its markets. In the Eastern European retion, the company improved its cigarette share in most markets. In Australia, JPS reached a spot share of 1.2% in December following its launch in May 2009, while in Asia, the company increased both cigarette volumes and shares in all its key markets in the region.
Chief executive Gareth Davis said, "Our emphasis on cost optimisation and synergy delivery will continue and further advances in productivity will help in offsetting further world leaf inflation. Our focus on sales and the effective use of high levels of cash generation will ensure that we remain on track to create further sustainable shareholder value."
For the full year 2009, Imperial's attributable profit increased to GBP 663 million from GBP 428 million in the prior-year period. On a per share basis, earnings advanced 30% to 65.3 pence from 50.4 pence earned in the previous year. Fiscal 2009 annual revenues grew 29% to GBP 26.5 billion from GBP 20.5 billion reported in the year ended September 30, 2008.
IMT is currently trading on the London Stock Exchange at 2,015.00 pence per share, up 13.00 pence or 0.65%, on a volume of 505,691 shares. In the past 52-week period, the stock has been trading in a range of 1,412.00 pence to 2,069.00 pence.
In Monday's regular trading session, ITYBY.PK closed trading at $63.39 per share on the Pink Sheets. In the past 52-week period, the shares have been trading in a range of $42.07 to $67.99.
For comments and feedback contact: editorial@rttnews.com
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.