British American Tobacco said on Thursday that it will cut 2,300 roles in an attempt to reinvest in the growth of its new products.
Shares in the company were up during trading on Thursday.
The multinational cigarette and tobacco manufacturing company hopes to simplify its business and become “more efficient, agile and focused”.
It hopes to deliver savings that can be reinvested in the growth of its new products such as vapour, tobacco heating products and oral tobacco.
British American Tobacco said that it will be reducing management layers, creating fewer larger more accountable business units and simplifying all key business processes.
Additionally, the plans include cutting 2,300 roles globally.
As it removes management layers, British American Tobacco expects over 20% of senior roles to be affected.
It plans to substantially complete this by January 2020.
“Since taking on the role of Chief Executive five months ago, I have been clear that I wanted to make BAT a stronger, simpler and faster organisation and ensure a future fit culture,” Jack Bowles, Chief Executive, said in a company statement.
“My goal is to oversee a step change in New Category growth and significantly simplify our current ways of working and business processes, whilst delivering long-term sustainable returns for our shareholders. This is a vital first move to help achieve these goals,” the Chief Executive continued.
“A programme of this significance involves decisions that will be difficult for our people, but ultimately it is the right thing for our business.”
“As a result, BAT will be better placed to deliver on our target of generating £5 billion of revenues in New Categories by 2023/24.”
The company revealed a “strong” full year performance in February for the 2018 financial year.
There are a number of health risks associated with smoking. Moreover, with the growth of the vaping trend, health officials in the US have warned against the use of vaping as it has killed at least three people.
Shares in British American Tobacco plc (LON:BATS) were trading at +1.68% as of 13:11 BST.
