British American Tobacco says that it expects its next-generation tobacco products division to be profitable earlier than previously anticipated, but its share price was down as diluted earnings per share declined.
Total revenue for BAT is set to come to £27.7 billion for 2022, up 7.7 percent from 2021.
Its “new categories” arm – made up of vaping products, heated tobacco products and nicotine pouches contributed £2.9 billion of 2022 revenues, which was up by 40.9 percent, reports the Evening Standard.
CEO Jack Bowles said the division was now expected to turn a profit in 2024, one year earlier than previously thought.
“Our new category business delivered strong volume, revenue and market share growth and has become a significant contributor to the group’s financial delivery,” he said. “In 2022, we invested more than £2 billion in new categories to drive long-term sustainable growth, while making excellent progress in reducing operating losses by 62 percent.”
Adjusted operating profit for BAT as a whole was in line with expectations at £12.4 billion.
However, BAT shares are down 4.5 percent so far today.
The top-selling Vuse electronic cigarette of BAT subsidiary R.J. Reynolds Vapor Co. continued to expand the market-share gap with Juul in both monthly and yearly comparisons.
BAT, the owner of the Irish business PJ Carroll, is also seeking to bring a judicial review against a decision by the European Union to ban flavored heated tobacco products.