“The group grew revenue at constant rates of exchange as a result of a slightly better price mix, despite increased competitive pricing activity in some of our key markets,” said [DATA BTI:BAT] chief executive, Nicandro Durante.
“Our volume performance reflects our broad geographic spread, increased market share and excellent growth of our Global Drive Brands. The group continues to perform well and we are on track to deliver another year of good earnings growth at constant rates of exchange.”
(READ MORE: BAT earnings impacted by adverse exchange rates)
Durante further alluded to the impact of currency movements on the group’s reported results with BAT’s revenue growing by 2.4 per cent at constant rates of exchange but declining by 9.6 per cent at current rates of exchange.
“The trading environment remains challenging due to continuing pressure on consumer disposable income worldwide and the slow economic recovery in Western Europe,” the company said.
“Pricing is weighted to the second half of the year, although recent competitive pricing activity in some key markets, notably Australia and Malaysia, and the growth of the low price segment resulted in some moderation of the improvement in price mix.”
The multinational tobacco company also reported a one per cent drop in cigarette volume from subsidiaries to 495 billion.
“Growth in many markets, including the Middle East, Bangladesh, Venezuela, Pakistan, Ukraine, Turkey and Indonesia, [was] more than offset by lower volume in Russia, Vietnam, Brazil, Poland and Canada, mainly driven by industry decline,” said BAT.
“Total tobacco volume was also one per cent lower. The five Global Drive Brands’ cigarette volume was up by 6.2 per cent, and their combined market share continued to grow strongly in the group’s key markets.”
The group further emphasised the fact that it has sufficient financing and facilities available for the foreseeable future.
(READ MORE: BAT grows revenue amidst enhanced 2013 strategy)
“There have been no material events, transactions or changes in the financial position of the group since the half-yearly report to 30 June 2014, other than as outlined in this statement,” BAT said.
“Further, the board is not aware of any material events, transactions or changes in the financial position of the group which have occurred up to and including 21 October 2014, being the latest practicable date before the date of the publication of this Interim Management Statement.”