UK's BAT H1 revenue rises 1.4% on New Categories growth

Overview

• UK tobacco group's H1 revenue rose 1.4%, slightly beating analyst expectations

• Adjusted diluted EPS for H1 up 7.9% yr/yr; smokeless products now 19.8% of revenue

• Company maintains £1.3 bln 2026 share buyback; U.S. growth offsets APMEA declines

Outlook

• Company expects mid-teens New Categories revenue growth for full-year 2026

• Company sees FY26 adjusted diluted EPS growth toward middle of 5-8% guidance range

• Company expects global cigarette industry volume to decline about 3% in 2026

Result Drivers

• NEW CATEGORIES GROWTH - Revenue from New Categories rose 18% at constant FX, led by Modern Oral (up 65.9%) and double-digit growth in U.S. Vapour

• COMBUSTIBLES PRICE/MIX - Improved combustibles revenue, up 2.1% at constant FX, driven by price/mix (including excise duty drawback in the U.S.)

• APMEA HEADWINDS - Slower than expected recovery in APMEA, with revenue down 6.3% at constant FX, due to regulatory challenges and illicit trade

Company press release: ID:nRSd4473Oa

Key Details

*Applies to a deviation of less than 1%; not applicable for per-share numbers.

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 11 "strong buy" or "buy", 4 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the tobacco peer group is "buy"

• Wall Street's median 12-month price target for British American Tobacco P.l.c is GBp5,200.00, about 9.7% above its July 29 closing price of GBp4,740.00

• The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 12 three months ago

Reuters Recommended Reads

• July 29 - BAT must face class-action litigation over cigarette labels, US appeals court rules

• July 27 - Philip Morris doubles Colorado campus investment to $1.2 billion

• July 27 - Marlboro cigarette maker Godfrey Phillips quarterly profit drops on tobacco tax

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)