Tobacco giant imperial brands posts higher profit figures

British tobacco giant Imperial Brands announced Tuesday a rise in annual profit as strong demand for vapes helped to offset falling sales of traditional cigarettes.

The group, whose brands include Golden Virginia tobacco, Rizla rolling papers, Winston cigarettes and the vaping brand blu, said net profit rose 12 percent to £2.6 billion ($3.3 billion) in the year to end-September.

Revenue dipped to £32.4 billion compared with 2022/23 as volume sales of traditional cigarettes fell four percent, Imperial said in a statement.

This was offset by higher pricing for tobacco, while revenue from "next generation products", notably electronic cigarettes, jumped more than 26 percent.

Imperial's share price was up 2.3 percent in London midday deals, with the company announcing also payouts to shareholders totalling £2.8 billion via dividends and share buybacks.

"Changing lifestyle habits and tougher regulation perennially overhang this sector, but in the meantime Imperial Brands continues to play the cards it has been dealt with aplomb," said Richard Hunter, head of markets at Interactive Investor.

Britain plans to prevent anyone born after January 1, 2009 from legally smoking by gradually raising the age at which tobacco can be bought.

The legislation brought by the new Labour government is similar to a bill proposed by the previous Conservative administration.

The bill will also introduce restrictions on vape advertising and sponsorship as well as restricting flavours, displays and the packaging of e-cigarettes to reduce their appeal to children and young people.

The proposals come after New Zealand revoked plans to introduce a "generational smoking ban" that would have stopped sales of tobacco to anyone born after 2008.