British American Tobacco (LON:BATS) shares rose over 4 percent on Thursday morning, after reporting a significant jump in both revenue and profit.
Operating profit rose 72.4 percent to £4.44 billion in the six months to June, with revenue up by 56.9 percent to £11.64 billion. Adjusted operating profit fell, however, by 5.4 percent and strong Revenues were partially offset by an 8 percent hit from a stronger pound.
“The foreign exchange impact on the Group’s results was a headwind of 8 percent for the first six months of the year and is estimated to be 5-6 percent for the full year, based upon the current foreign exchange rates,” the company said.
The results were largely boosted by an increase in the volume of cigarettes and THP sold, up 11 percent to 348.3 billion on a reported basis. This was driven by the acquisition of Reynolds American and good pricing.
“Despite the recent slowdown in the THP category in some markets, including Japan and South Korea, we remain confident of exceeding £1 billion of reported revenue in NGP in 2018 as we expect a range of new launches to re-energise growth in THP in the second half of the year,” the company said.
Shares in British American Tobacco are currently up 4.10 percent at 4,136.00 (0818GMT).
