By Michael Susin
British American Tobacco shares fell after the company missed market expectations for 2024 and announced a $7.72 billion provision related to a litigation settlement in Canada.
Shares were down 8.4% at 31.08 pounds. However, the stock is up more than 40% over the last 52 weeks.
The FTSE 100 cigarette maker--which houses the Kent, Dunhill and Lucky Strike brands--reported a pretax profit for 2024 of 3.54 billion pounds ($4.41 billion) compared with a loss of 17.06 billion pounds in 2023, when it booked a 27.6 billion pounds one-off impairment related to its U.S. business.
Adjusted profit from operations--one of the company's preferred metrics--came in at 11.89 billion pounds, down 0.2% from a year ago and missing a company-provided consensus forecast of 11.95 billion pounds.
The company added that it booked a 6.2 billion-pound provision related to a litigation settlement in Canada.
New categories products--which includes vapour/heated products and oral pouches--revenue rose 2.5% to 3.42 billion pounds from 3.26 billion pounds, below market consensus of 3.50 billion pounds. The segment is key for British American Tobacco as it seeks to achieve 50% of revenue from smokeless products by 2035.
Revenue for the group as a whole fell 5.2% to 25.87 billion pounds, dragged by the sale of its businesses in Russia and Belarus in September 2023 and foreign-exchange headwinds. Revenue was forecast at 26.11 billion pounds, according to consensus provided by the company.
Looking ahead, the company said it expects revenue to grow around 1%, dragged by an impact on its combustibles segment due to increased taxes in Bangladesh and new regulations in Australia.
Adjusted profit from operations is forecast to grow between 1.5% and 2.5%.
The board declared a dividend of 240.24 pence a share, up from 235.52 pence. It also announced a 900 million pounds share buyback program for 2025.
Write to Michael Susin at michael.susin@wsj.com
(END) Dow Jones Newswires
February 13, 2025 04:42 ET (09:42 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.
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