REG - British Amer.Tobacco - Annual Financial Report
13/02/2026 14:00
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RNS Number : 0008T British American Tobacco PLC 13 February 2026
BRITISH AMERICAN TOBACCO p.l.c. (the "Company")
Annual Report for the Year Ended 31 December 2025
In compliance with UK Listing Rule 6.4.1 and Disclosure Guidance and
Transparency Rule ("DTR") 4.1.3, the Company announces that the following
documents have been published on its website: www.bat.com/annualreport
(http://www.bat.com/annualreport) :
· Combined Annual and Sustainability Report 2025 (the Annual Report);
· Annual Report on Form 20-F 2025 (the Form 20-F); and
· Combined Performance and Sustainability Summary 2025.
These documents have been submitted to the National Storage Mechanism and will
shortly be available for inspection via the following link:
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism) .
In addition, in accordance with Section 203.01 of the New York Stock Exchange
Listed Company Manual, the Company announces that it filed its Form 20-F with
the U.S. Securities and Exchange Commission on 13 February 2026. The Form 20-F
included audited financial statements for the year ended 31 December 2025. The
Form 20-F will shortly be available on the Company's website at
www.bat.com/annualreport and also online at www.sec.gov.
The Annual Report and other ancillary shareholder documents will be mailed and
made available to shareholders on 10 March 2026. Investors have the option to
receive a hard copy of the Company's complete audited financial statements,
free of charge, upon request, by contacting the below:
United Kingdom
British American Tobacco Publications Telephone: +44 20 7511 7797
Email: bat@team365.co.uk
South Africa
The Company's Representative Office Telephone: +27 21 003 6712
United States
Citibank Shareholder Services Telephone: +1 888 985 2055 (toll-free)
Email: citibank@shareholders-online.com
This announcement should be read in conjunction with the Company's Final
Results announcement which was released to the market on 12 February 2026.
Together these constitute the material required by DTR 6.3.5R to be
communicated to the media in unedited full text through a Regulatory
Information Service. This material is not a substitute for reading the full
Annual Report. Page numbers and cross-references in the extracted information
below refer to page numbers in the Annual Report. The following disclosures
are set out in the appendices to this announcement:
· Appendix A: Group Principal Risks (pages 168 to 175 of the Annual
Report);
· Appendix B: Related Party Disclosures (pages 332 and 333 of the Annual
Report); and
· Appendix C: Directors' Responsibility Statement (page 238 of the
Annual Report).
C Worlock
Assistant Secretary
13 February 2026
Enquiries:
Media Centre
press_office@bat.com | @BATplc
Investor Relations
Victoria Buxton | IR_team@bat.com
APPENDIX A
"GROUP PRINCIPAL RISKS
Overview
The Principal Risks that may affect the Group are set out on the following
pages.
Principal Risks are those that have the potential to most impact the
achievement of the Group's strategic objectives. These are significant risks
that could affect the Group's long-term financial performance, reputation, or
delivery of sustainability targets.
The Group has identified risks and is actively monitoring and mitigating these
risks. This section focuses on those risks that the Directors believe to be
the Principal Risks to the Group. Not all of these risks are within the
control of the Group and other risks besides those listed may affect the
Group's performance. Some risks may be unknown at present. Other risks,
currently regarded as less material, could become more material in the future.
Clear accountability is attached to each risk through the risk owner.
Each Principal Risk is assessed against the Group's defined risk appetite,
which is set by strategic objectives. The Board monitors appetite through
regular reporting from the Audit Committee and
Group Risk Management Committee.
The risks listed in this section and the activities being undertaken to manage
them should be considered in the context of the Group's internal control
framework. This process is described in the section on risk management and
internal control in the Audit Committee Report from page 206 and is further
supported by the principles and processes set out in the Group Risk Management
Manual.
Each risk is considered in the context of the Group's strategy and business
model, as set out in this Strategic Report beginning on page 2 and page 12
respectively. On the following pages is a summary of each Principal Risk, its
potential impact and management by the Group.
In addition to Principal Risks, the Group actively monitors emerging risks
through structured horizon scanning and biannual reviews by the Group Risk
Management Committee. Emerging risks, such as those arising from regulatory
changes, geopolitical volatility, or technological disruption, are escalated
to the Audit Committee and Main Board where appropriate, and considered in the
context of the Group's long-term viability and resilience.
A summary of all the risk factors (including the Principal Risks) which are
monitored by the Board through the Group's risk register, with an expanded
description of each risk factor, including additional context, detailed
drivers and potential impacts, is set out from page 4 of BAT's Form 20-F for
the year ended 31 December 2025, which can be accessed via the SEC's EDGAR
database and on BAT's website at www.bat.com/investors-and-reporting/
(http://www.bat.com/investors-and-reporting/) .
Assessment of Group Principal Risks
During the year, the Directors carried out a robust assessment of the
Principal Risks, uncertainties and emerging risks facing the Group, including
those that could impact its reputation or delivery of its strategic
objectives, business model, future performance, solvency or liquidity.
Leading in Sustainability is a core component and key building block of our
corporate strategy and sustainability risk factors are embedded across the
Group's risks in accordance with the management of these risks within the
Group.
All Group risks are reviewed biannually by the Audit Committee and annually by
the Board. During the period, the risk related to "Litigation" was renamed
"Litigation and external investigations", the risk related to "Circular
economy" was renamed "Circularity" and the risk related to "Cybersecurity" was
renamed "Digital & Cyber", reflecting the nature of the risk. There were
no changes to the underlying risks.
The viability statement on page 176 provides a broader assessment of long-term
solvency and liquidity. The Directors considered a number of factors that may
affect the resilience of the Group. Except for the risk "Injury, illness or
death in the workplace" which is not considered to be sufficiently material to
impact the Group's overall viability assessment, the Directors also assessed
the potential impact of the Principal Risks that may impact the Group's
viability.
Group Principal Risks
Competition from illicit trade
Increased competition from illicit trade and illegal products - either local
duty evaded, smuggled, counterfeits, or non-regulatory compliant, including
products diverted from one country to another.
Time frame
Short-/medium-/long-term
Strategic impact
Quality Growth/Sustainable Future
Key Stakeholders
Consumers, Customers, Investors, & Society
Considered in viability statement
Yes
Risk Trend
Increasing
Impact
Illicit trade often leads to more restrictions and regulations imposed on the
legitimate industry, including sales restrictions, overly burdensome track and
trace systems and display packaging bans. This is often based on the erroneous
assertion that the legitimate industry makes up the bulk of illicit trade in
tobacco products.
Erosion of goodwill, with lower volumes and/or increased operational costs
(e.g. track and trace costs) and reduced profits.
Reduced ability to take price increases.
Investment in trade marketing and distribution is undermined and the product
is commoditised.
Illicit products (including New Categories) could harm consumers, damaging
goodwill, and/or the category (with lower volumes and reduced profits),
potentially leading to misplaced claims against BAT, further regulation and a
failure to deliver the corporate harm reduction objective.
Breach of legislation, criminal offences, contract breaches, and allegations
of facilitating smuggling may result in fines, penalties, seizure payments,
and reputational damage, including negative
perceptions of our governance.
Existence of illicit trade reduces our ability to reduce the health impact of
our business, it undermines policies of governments with respect to underage
tobacco users and creates bases for
inappropriate regulation.
Mitigation activities across all categories
Dedicated Anti-Illicit Trade (AIT) teams operating at regional and country
levels and internal cross-functional levels; compliance procedures, toolkit
and best practice shared.
Active engagement with key external stakeholders, including international
governmental and non-governmental organisations to highlight illicit trade
challenges and build alignment around policy
solutions. Cross-industry and multi-sector cooperation on a range of AIT
issues.
Regional AIT strategy supported by a research programme to further the
understanding of the size and scope of the matter.
As illicit e-commerce becomes a larger threat to the business, the Group
determines the scale of illicit online sales to highlight the threat to
authorities and to enable them to take direct action
against websites selling illicit products.
AIT engagement teams (including a dedicated analytical laboratory and a
forensic and compliance team) work with enforcement agencies as appropriate.
Enhanced intelligence databases and
targeted enforcement actions in priority markets are in place.
Geopolitical tensions
Geopolitical tensions, civil unrest, economic policy changes, as well as
shifts in the structure and policies of major trading blocs, global health
crises, terrorism and organised crime have the potential to disrupt the
Group's business in multiple markets.
Time frame
Short-/medium-term
Strategic impact
Quality Growth/Sustainable Future
Key Stakeholders
Customers, Our people, Investors, Society, & Suppliers
Considered in viability statement
Yes
Risk Trend
No change
Impact
Potential injury or loss of life, loss of assets and disruption to supply
chains and normal business processes. This applies to both internal and
outsourced activities.
Increased costs due to more complex supply chain and security arrangements
and/or the cost of building new facilities or maintaining inefficient
facilities.
Lower volumes as a result of not being able to trade in a country.
Higher taxes or other costs of doing business as a foreign company or the loss
of assets as a result of nationalisation.
Disruptions or changes in trading bloc membership, trade agreements, or the
imposition of new trade barriers may restrict market access, increase tariffs,
or require costly supply chain reconfiguration, impacting profitability and
long-term strategic plans.
Reputational damage, including negative perceptions of our governance and
protection of our people and our sustainability credentials. Disruption to the
supply chain impacts our ability to reduce the health impact of our business.
Mitigation activities across all categories
Physical and procedural security controls are in place, and regularly reviewed
in accordance with our security risk management process, for all field force
and supply chain operations, with an emphasis on the protection of Group
employees.
Globally integrated sourcing strategy and contingency sourcing arrangements
are in place.
Security risk modelling, including external risk assessments, monitoring of
geopolitical and economic policy developments worldwide, including ongoing
monitoring of trading blocs developments and trade policy changes.
Insurance coverage and business continuity planning, including scenario
planning and testing, and risk awareness training.
Geopolitical assessment and monitoring by the Group Security Centre of
Excellence and regions inform the business continuity management organisation
plans and responses to geopolitical risks, including readiness of crisis
management teams at all levels.
Tobacco, New Categories and other regulation interrupts growth strategy
The enactment of, proposals for, or rumours of, regulation that significantly
impairs the Group's ability to communicate, differentiate, innovate, market or
launch its products, and/or the lack of appropriate regulation for New
Categories.
Time frame
Short-/medium-/long-term
Strategic impact
Quality Growth/Sustainable Future
Key Stakeholders
Consumers, Customers, Investors & Society
Considered in viability statement
Yes
Risk Trend
No change
Impact
A lack of acceptance or rejection of Tobacco Harm Reduction as a tobacco
control policy could prevent a balanced regulatory framework for New
Categories. Restricted ability to sell and communicate New Categories could
lead to failure of the harm reduction objective and loss of confidence in the
Group's
sustainability performance.
Lack of appropriate regulation and its enforcement or disproportionate
regulations for New Categories, such as questionable regulatory
classifications or total bans, that may not
be science-based and/or risk-proportionate, may impact our opportunity for
quality growth and affect our ability to develop and market a pipeline of new
products. Reduced ability to make scientific claims, compete in future product
categories and make new market entries. Inappropriate regulation may also
increase the volume of illicit trade activity.
Erosion of brand value through commoditisation and the inability to launch
innovations may negatively affect our ability to generate value growth.
Regulation with respect to bans or severe restrictions on menthol flavours,
product design and features and nicotine levels may adversely impact
individual brand portfolios.
Reduced consumer acceptability of new product specifications, leading to
consumers seeking alternatives in illegal markets or irresponsible operators
exploiting regulatory loopholes.
Shocks to share price on rumours of, or the announcement or enactment of,
restrictive regulation (e.g. sales ban to future generations).
Failure to deliver appropriate and proportionately costed Extended Producer
Responsibility (EPR) schemes.
Mitigation activities across all categories
Establishment of governance forums, the objectives of which are to review the
execution of the Group's regulatory, corporate, and science strategies,
monitor the regulatory and science landscape, prioritise key regulatory and
science initiatives and resource allocation.
Cross-functional alignment between Corporate & Regulatory Affairs, Legal,
Marketing, Finance, Sustainability, Investor Relations, Operations, and
Research & Science to support regulatory objectives and Ready for
Regulation (R4R). Actionable insights and foresights are developed through
horizon planning to anticipate regulatory changes.
Engagement and alignment across the Group to drive a balanced global policy
framework for combustible and Smokeless products.
Stakeholder mapping and prioritisation, developing robust compelling advocacy
materials (with supporting evidence and data) and regulatory engagement
programmes.
Regulatory risk assessment of marketing plans to ensure decisions are informed
by an understanding of the potential regulatory environments.
Advocating the application of integrated regulatory proposals to governments
and public health regulators and practitioners based on the harm reduction
potential of New Categories.
Encourage dialogue with stakeholders across the wider scientific and
regulatory ecosystem in relation to tobacco and nicotine products through
Omni™.
Development of an integrated regulatory strategy that spans conventional
combustibles and New Categories.
Training and capability programmes for end markets to upskill Corporate and
Regulatory Affairs managers on combustible and New Categories regulatory
engagement, including product knowledge.
Direct access to online portal providing latest position and advocacy material
for end market engagement on combustibles and New Categories.
Working to define a sustainable EPR model and markets negotiating to implement
effective EPR schemes.
Please refer to the to the description of the tobacco and nicotine regulatory
regimes under which the Group's businesses operate set out on page 24 and page
25
Supply Chain disruption
Disruption to the global supply chain that may impact our ability to
manufacture products or supply our consumers.
Time frame
Short-
Strategic impact
Quality Growth/Sustainable Future/Dynamic Business
Key Stakeholders
Consumers, Customers, Our People, & Suppliers
Considered in viability statement
Yes
Risk Trend
No change
Impact
Disruption to the global supply chain may impact all aspects of our business
and impede our ability to manufacture products and supply our consumers.
Disruption to supply chain can lead to manufacturing delays, volume shortfalls
and inability to supply markets, increased replacement or/and rebuild costs
consequently leading to reduced profit and reputational damage. This may
affect our ability to reinvest in New Categories and deliver our Tobacco
Harm Reduction commitment.
Loss of one or more key facilities or suppliers may cause loss of life and
injuries. It may also lead to societal dislocation resulting in population
migration and loss of key skills.
Our supply chain could be negatively impacted by events arising from, but not
limited to, natural disasters, man-made accidents, cyber incidents.
Mitigation activities across all categories
Group-wide business continuity plans (BCP) and contingency sourcing plans
(CSP) in compliance with the new business continuity management standard, are
in place.
All factory CSPs are regularly updated, reviewed and desktop simulations
conducted to ensure compliance with the Group's policy. Coverage targets and
waivers for contingency.
sourcing plans are monitored and updated regularly.
BCPs and disaster recovery plans for logistics providers are in place.
Unrest and evacuation plans are in place.
Existence of insurance cover for Property Damage and Business Interruption.
Appropriate technical and organisational cyber security measures are in place.
Litigation and external investigations
Product liability, regulatory or other significant cases (including
investigations or class action litigations) may be lost or settled resulting
in a material loss or other consequence.
Time frame
Short-/medium-/long-term
Strategic impact
Quality Growth/Sustainable future
Key Stakeholders
Investors & Society
Considered in viability statement
Yes
Risk Trend
No change
Impact
Damages and fines, negative impact on reputation (including sustainability
credentials), disruption and loss of focus on the business.
Consolidated results of operations, cash flows and financial position could be
materially affected by an unfavourable outcome or settlement of pending or
future litigation, criminal prosecution
or other contentious action, or by the costs associated with bringing
proceedings or defending claims.
Inability to sell products as a result of an injunction arising out of a
patent infringement action against the Group may restrict growth plans and
competitiveness.
Potential share price impact, reduction in financing opportunities and
investor base.
Sustainability-related litigation could also result in a reduction in the
investor base due to sustainability-related concerns.
Mitigation activities across all categories
Consistent litigation and patent management strategy across the Group.
Expertise and legal talent maintained both within the Group and external
partners, including for New Categories and sustainability-related matters.
Ongoing monitoring of key legislative and case law developments related to our
business.
Delivery with Integrity compliance programme.
Litigation strategy developed in relation to key regulatory issues.
Central management of strategic litigation impacting key regulatory processes.
Developing expert analysis on efficacy of various regulatory proposals.
Please refer to note 31 on page 334 in the Notes on the Accounts for details
of contingent liabilities applicable to the Group.
Significant increases or structural changes in tobacco, nicotine and New
Categories related taxes
The Group is exposed to unexpected and/or significant increases or structural
changes in tobacco, nicotine and New Categories related taxes in key markets.
Time frame
Short-/medium-/long-term
Strategic impact
Quality Growth/Sustainable Future
Key Stakeholders
Consumers, Customers, Investors & Society
Considered in viability statement
Yes
Risk Trend
No change
Impact
Excise-driven price increases can stretch affordability, drive downtrading or
purchases of products from illicit sources, reduce legitimate industry
volumes, alter sales mix, erode portfolio, and
impact profit/share. Reduced sales volume and/or portfolio erosion leading to
inability to invest in, develop, commercialise and deliver New Category
products.
Excise creditor days significantly reduced, creating large negative cash
impacts and increasing ongoing net financing costs.
Excise increases are generally passed to consumers, but significant increases
may be partially absorbed, leading to lower profitability.
A disproportionate tax, which would be passed on to the consumer, could
discourage consumer switching from FMC to reduced-risk products.
Mitigation activities across all categories
Formal pricing and excise strategies, including revenue growth management
using a data science-led approach, with annual risk assessments and
contingency plans across all products.
Pricing, excise and trade margin committees in markets, with global support.
Engagement with relevant local and international authorities where
appropriate, in particular in relation to the increased risk to excise
revenues from higher illicit trade.
Portfolio reviews to ensure appropriate balance and coverage across price
segments.
Monitoring of economic indicators, government revenues and the political
situation.
Inability to develop, commercialise and deliver the New Categories strategy
Failure to build scientific credibility, maintain regulatory compliance, and
execute profitable and responsible marketing practices for New Categories,
resulting in inability to scale, achieve harm reduction objectives, and
deliver sustainable growth.
Time frame
Short-/medium-/long-term
Strategic impact
Quality Growth/Sustainable Future/Dynamic Business
Key Stakeholders
Consumers, Society, Shareholders & Investors
Considered in viability statement
Yes
Risk Trend
No change
Impact
Inability to continue to deliver Group financial results in line with
shareholder and analyst expectations resulting in an adverse external
perception of the Group's strategy and reputation.
Potentially missed opportunities, unrecoverable costs and/or erosion of brand,
with lower volumes and reduced profits.
Rapidly evolving regulatory environments, inconsistent market practices, and
insufficient legal oversight of marketing activities may lead to litigation,
regulatory investigations, reputational
damage, and loss of consumer trust, undermining Group's harm
reduction objectives and sustainability credibility.
Reputational damage and recall costs may arise in the event of defective
product design or manufacture.
Loss of market share due to non-compliance of product portfolio with
regulatory requirements or inability to engage on our science, leading to a
negative shift in sentiment and
confidence in Group products.
Inability to convince regulators and policymakers regarding the weight of
scientific evidence assessment underpinning the harm reduction potential of
New Categories products which could
result in failure to deliver our corporate purpose of Building a Smokeless
World.
Mitigation activities across all categories
Focus on product stewardship to ensure high-quality standards across the
portfolio.
Brand Expression, which sets out how our brand expresses itself (including
through its logo, name, product, packaging, etc.) deployed to lead End Markets
via activation workshops and best practices shared.
Marketing compliance is ensured through legal review of initiatives,
cross-functional oversight, deployment of the responsible marketing framework,
and global training for employees and partners to uphold responsible marketing
standards.
Implementation of commercial models and pricing strategies across New
Categories products, with profitability as a core objective. To support
strategic prioritisation and efficient resource deployment,
structured frameworks and guiding principles are defined to optimise
investment decisions and spending.
Accelerating digital and consumer analytics along with data management
platforms for enhanced methodologies, insight generation and line of sight
across the Group.
Scientific research adherence to internationally recognised standards ISO 9001
and laboratories accredited to ISO 17025 for key methods.
Internal and external communications about BAT's science through publications
and engagement, such as the Omni™. Quality assurance reviews undertaken with
key science suppliers to ensure
appropriate standards in place.
Disputed taxes, interest and penalties
The Group may face significant financial penalties, including the payment of
interest, in the event of an unfavourable ruling by a tax authority in a
disputed area.
Time frame
Short-/medium term
Strategic impact
Quality Growth/Sustainable Future
Key Stakeholders
Investors & Society
Considered in viability statement
Yes
Risk Trend
Increasing
Impact
Significant fines and potential legal penalties.
Disruption and loss of focus on the business due to diversion of management
time.
Impact on liquidity, cash flow, profit and dividend.
Disruption in production or distribution may occur due to license withdrawal
or litigation.
Damage to reputation from non-compliance or high-profile disputes, including
civil or criminal prosecution. High costs associated with prolonged litigation
and regulatory penalties.
Mitigation activities across all categories
End Market tax committees, excise duty controls and self-assessment conducted.
Internal tax function provides dedicated advice and guidance, and external
advice sought where needed.
Engagement with tax authorities at Group, regional and individual market
level.
Processes in place for managing tax audits incorporated under Global Operating
Model (GOM).
Injury, illness or death in the workplace
The risk of injury, death or ill health to employees and those who work with
the business is a fundamental concern of the Group
and can have a significant effect on our operations.
Time frame
Short-term
Strategic impact
Quality Growth/Sustainable Future/Dynamic Business
Key Stakeholders
Our people & Suppliers
Considered in viability statement
No
Risk Trend
No change
Impact
Serious injuries, ill health, disability or loss of life suffered by employees
and the people who work with the Group.
Exposure to civil and criminal liability and the risk of prosecution from
enforcement bodies and the cost of associated legal costs, fines and/or
penalties.
Interruption of Group operations if issues are not remedied promptly.
High staff turnover or difficulty recruiting employees and sustainability
ratings affected if perceived to have a poor Environment, Health and Safety
(EHS) record.
Reputational damage to the Group and negative impact on our sustainability
credentials.
Mitigation activities across all categories
Risk control systems in place to help ensure equipment and infrastructure are
provided and maintained.
EHS strategy aims to ensure that employees at all levels receive appropriate
EHS training and information.
Exploration and deployment of leading technology solutions and a
behavioural-based safety programme to drive operational safety performance,
and promotion of a Group culture that brings us
closer to zero accidents.
Analysis of incidents undertaken regionally and globally by a dedicated team
to identify increasing incident trends or high potential risks that require
coordinated action.
Global monthly Health & Safety (H&S) Committee established, formed by
senior members from the H&S and Operations Sustainability leadership
team.
Solvency and liquidity
Liquidity (access to cash and sources of finance) is essential to maintaining
the Group as a going concern in the short-term(liquidity) and medium-term
(solvency).
Time frame
Short-/medium-term
Strategic impact
Quality Growth/Sustainable Future/Dynamic Business
Key Stakeholders
Investors & Suppliers
Considered in viability statement
Yes
Risk Trend
Decreasing
Impact
Inability to access the Group's cash resources and to fund the business under
the current capital structure resulting in missed strategic opportunities or
inability to respond to threats.
Decline in our creditworthiness and increased funding costs for the Group.
Requirement to issue equity or seek new sources of capital.
Reputational risk of failure to manage the financial risk profile of the
business, resulting in an erosion of shareholder value reflected in an
underperforming share price.
Inability to mitigate accounting and economic exposures.
Economic loss as a result of devaluation/revaluation of assets (including
cash) valued or held in local currency, and additional costs as a result of
paying premiums to obtain hard currency.
Failure to appropriately engage with investors' and lenders' sustainability
criteria and concerns may impact BAT's counterparty availability, credit
ratings and access to funding, or may result in an increase in the cost of
funding.
Exposure to the cannabis sector may lead to regulatory and legal risk,
reputation and compliance issues restricting bank and/or investor access.
Mitigation activities across all categories
Group policies include a set of financing principles and key performance
indicators, including the monitoring of credit ratings, interest cover,
solvency and liquidity with regular reporting to the
Corporate Finance Committee and the Board.
Controls in place to ensure full compliance with sanctions regimes.
Plans implemented to manage the risk in key geographies.
The Group targets an average centrally managed debt maturity of at least five
years with no more than 20% of centrally managed debt maturing in a single
rolling year.
At 31 December 2025, the Group had access to a £5 billion revolving credit
facility which remained undrawn. In November 2025, the Group refinanced its
existing £5.2 billion facility at the reduced amount of £5.0 billion,
comprising (i) a £2.5 billion 364-day tranche with two one-year extension
options and one-year term out option and (ii) a £2.5 billion five-year
tranche with two one-year extension options.
Liquidity pooling structures are in place to ensure that there is maximum
mobilisation of cash liquidity within the Group.
Going concern and viability support papers are presented to the Board on a
regular basis.
Continued review of UK money laundering legislation and cannabis policy with
financial partners.
Foreign exchange rates exposures
The Group faces translational and transactional foreign exchange (FX) rate
exposure for earnings/cash flows from its global businesses.
Time frame
Short-/medium-term
Strategic impact
Quality Growth/ /Dynamic Business
Key Stakeholders
Investors & Suppliers
Considered in viability statement
Yes
Risk Trend
No change
Impact
Fluctuations in FX rates of key currencies against sterling introduce
volatility in reported earnings per share (EPS), cash flow and the balance
sheet driven by translation into sterling of our financial results and these
exposures are not normally hedged.
The dividend may be impacted if the payout ratio is not adjusted.
Differences in translation between earnings and net debt may affect key ratios
used by credit rating agencies.
Volatility and/or increased costs in our business, due to transactional FX,
may adversely impact financial performance.
Mitigation activities across all categories
While translational FX exposure is not hedged, its impact is identified in
results presentations and financial disclosures; earnings are restated at
constant rates for comparability.
Debt and interest are matched to assets and cash flows to mitigate volatility
where possible and economic to do so.
Hedging strategy for transactional FX is defined in the treasury policy, a
global policy approved by the Board.
Illiquid currencies of many markets where hedging is either not possible or
uneconomic are reviewed on a regular basis.
Climate Change
Direct and indirect adverse impacts associated with climate change (both
physical and transition).
Time frame
Short-/medium-/long-term
Strategic impact
Quality Growth/Sustainable Future
Key Stakeholders
Consumers, Customers, Our People, Investors, Society & Suppliers
Considered in viability statement
Yes
Risk Trend
No change
Impact
Physical risks to agricultural, manufacturing, operational and logistic
processes may lead to reduced production, delays, volume shortfalls,
disruption of energy supply (and other utilities), costs of reinstatement and
business interruption.
Extreme temperatures and weather events could be harmful for employees,
creating health and safety risks, and affect factories' productivity.
Volatility in supply volume associated with climate change (including crop
yield, loss of biodiversity or disruption to manufacturing or freight routes)
may result in reduced revenue, increased cost of "last minute" sourcing of
services necessary for the operation of the Group's business across its value
chain.
Evolving climate regulation could result in increased costs of compliance and
in punitive actions or loss of market access for failure to comply.
Poor agency ratings associated with climate change risk, performance,
mitigation, or adaptation could lead to reduced access to capital, increased
cost of capital or impact the share price.
Mitigation activities across all categories
The Group has clear internal ownership and accountability for sustainability
issues.
Regular updates to the Board and Management Board facilitate effective
management of material sustainability issues.
Monitoring of climate change-related governmental policy and regulations
enables action plans to be implemented.
The Group has established an enhanced climate diagnosis tool to enable
assessment of physical risks, including additional climate hazard analysis,
leaf growing areas, site resiliency data and
formulation of necessary actions.
Business continuity management plans are in place to mitigate supply chain
disruptions resulting from weather events.
Measures taken in tobacco supply chain to mitigate climate change-related
risks such as Carbon Smart Farming and Farmer Sustainability Management
System.
Circularity
Unsustainable global demand for finite resources, combined with increasing
regulatory, stakeholder and consumer pressure to reduce product and packaging
waste, may impact the delivery of a viable circular business model, leading to
increased costs, regulatory non-compliance, reduced market access,
reputational harm, and lower consumer demand.
Time frame
Short-/medium-/long-term
Strategic impact
Quality Growth/Sustainable Future
Key Stakeholders
Consumers, Customers, Our People, Investors, Society & Suppliers
Considered in viability statement
Yes
Risk Trend
No change
Impact
Evolving regulations and stricter requirements (on product design, product
composition, transparency, unsustainable materials or extended producer
responsibility) could result in increased costs of compliance, punitive
actions against the Group, loss of revenue or inability to sell products in
the key markets.
Reduction of market share and revenue, due to consumers having a reduced or
negative perception of BAT and its products in comparison to its competitors,
or of specific products/product
categories overall.
Inadequate product generated waste management (e.g., lack of collection,
recovery or recycling) may cause damage to Group's reputation and brand value
and increase waste management
costs.
Inability to source, design and manufacture products that require sustainable
materials (including critical minerals) or materials that are affected by
availability, increased costs, duties or tariffs.
Mitigation activities across all categories
Life Cycle Assessment is used in the development and approval processes for
new products to assess and improve their circularity.
Corporate strategy drives innovations and initiatives in circularity across
all product categories.
Programs launched to enhance sourcing of sustainable materials, and
circularity of products and packaging.
Optimise circular economy alignment across the value chain by designing for
the reuse and recycling of end-of-life products and increasing the use of
recycled and environmentally
preferable materials.
Periodic review of current and evolving sustainability policies and
regulations to inform the Group's circular economy strategy.
Cross-functional and cross-industry engagement on sustainability topics.
Digital & Cyber
Inability of the organisation to defend against an intentional or
unintentional action that results in loss of confidentiality, availability or
integrity of systems and data.
Time frame
Short-/medium-/long-term
Strategic impact
Quality Growth/Sustainable Future/Dynamic Business
Key Stakeholders
Consumers, Customers, Our People, Investors, Society & Suppliers
Considered in viability statement
Yes
Risk Trend
No change
Impact
A significant cyber event, whether caused by targeted attack (e.g.,
ransomware, data breach), unintentional action (e.g., misconfiguration, human
error), or third-party failure, could
result in loss of:
- Confidential information: Compromise of strategic plans, product
designs, intellectual property, or market expansion initiatives, enabling
illicit trade, undermining competitive advantage, and resulting in lost
commercial opportunities, future revenue, profitability, and investor
confidence.
- Business continuity: Widespread operational disruption, including
downtime, inefficiencies, or paralysis across markets and operations. Critical
processes may halt, supply chain, manufacturing, and customer services may be
impacted, and decision-making delayed.
- Personal data: Unauthorised disclosure of personal data, exposing
BAT to regulatory penalties, legal action, compensation claims, reputational
damage, loss of customer trust, and increased scrutiny from regulators.
- Digital trust: Damage to the integrity of BAT's systems or data
(unauthorised changes, manipulation, misinformation) can undermine stakeholder
confidence, erode customer and partner trust, and reduce market credibility.
- Technology-related non-compliance: Failure to comply with digital,
data protection, and cybersecurity regulations or contractual obligations
could result in regulatory investigations, fines, legal action and operational
restrictions.
- Third-party technology disruption: Disruption affecting a critical
third-party provider could lead to significant operational, security, or data
integrity issues, amplifying broader cyber risks, including business
disruption, data loss, or regulatory non-compliance.
Mitigation activities across all categories
The Group implements physical, technical and administrative safeguards to
mitigate risks of a cyber security incident, including security measures, such
as defensive technologies, access controls, encryption, authentication, backup
and recovery systems, to protect the confidentiality, integrity and
availability of systems and networks.
Regular training and awareness programmes are provided to Group employees and
contractors on cyber security best practices, procedures, and adherence to our
SoBC, promote a strong security
culture across all levels of the Group.
Vendor management processes are in place, including due diligence and
contractual obligations, to ensure that third-party service providers adhere
to BAT's cyber security requirements and standards.
The Group has business continuity plans to support resilience and a prompt
response to any potential or actual cyber security incident and minimise their
impact on the business.
The Group engages with external assessors, consultants, auditors and other
third parties to provide independent assurance, review and recommendations on
cyber security matters. Cyber security
processes are reviewed and updated on a regular basis to ensure these remain
effective and aligned with our business objectives, regulatory obligations and
industry standards.
The Group's Security Operations Centre provides continuous monitoring and
response to emerging threats, supported by regular penetration testing and
incident simulations. Specialised
programmes address emerging risks areas, such as operational technology
security and AI governance.
Strategic investments in cyber security capabilities are guided by annual
planning cycles and informed by external benchmarking.
Viability Statement
The preparation of the long-term viability statement includes an assessment of
the Group's ability to meet future commitments and liabilities as they fall
due.
Assessment of Long-Term Viability
Strong liquidity and access to facilities
The Directors noted that the Group has a strong track record of cash flow
delivery and expects to generate in excess of £50 billion of free cash flow
before dividends between 2024 and 2030 (inclusive).
The Group has net cash and cash equivalents at 31 December 2025 of £3.8
billion (of which £0.3 billion is restricted), and access to a number of
facilities (as described in note 26), including:
- a syndicated £5.0 billion committed revolving credit facility, that
is currently undrawn;
- a US$4 billion U.S. commercial paper programme, a £3 billion euro
commercial paper programme and short term bilateral facilities (£2.7
billion), all of which were undrawn.
The Group continues to maintain investment‑grade credit ratings*, with
ratings from Moody's, S&P and Fitch of Baa1 (stable outlook), BBB+ (stable
outlook), BBB+ (stable outlook), respectively, and
continues to target a solid investment-grade credit rating of Baa1, BBB+ and
BBB+.
The strength of the ratings has underpinned debt issuance and the Group is
confident in its ability to access the debt capital markets.
Assessment and scenario planning
In making the assessment, the Directors undertook a robust review of the
Group's operational and financial processes (which cover both short-term
financial forecasts and capacity plans) and how
the Principal Risks (as indicated on pages 166 to 175) may impact the Group's
viability under various scenarios. Notes 23 and 26 in the Notes on the
Accounts provide further detail on the Group's borrowings and management of
financial risks.
The Directors recognised that multi-year cash flow forecasts are prepared to:
- assess impairment (as described in note 12 in the Notes on the
Accounts) for a number of the Group's reporting entities (or cash generating
units); and
- input into the active capital allocation model, including debt
maturity planning.
The Group does not have any financial covenants related to its current debt
issued or available facilities. In order to assess viability, a base scenario
was developed, which assessed the Group's
notional headroom against a theoretical interest cover** of 5.0x, used on a
conservative basis that such a financial covenant may be applied in the
future. Each scenario then assessed how the earnings
of the Group may be affected by the realisation of the risks and then, if
necessary, determined how many times more severe that risk must be before the
theoretical interest cover was breached.
Reverse stress testing
A reverse stress test of the impact of the individual Principal Risks was also
undertaken as part of the assessment. This did not identify any individual
risk, based upon a prudent annual forecast
that would, if arising in isolation and without mitigation, impact the Group's
viability within the three-year confirmation period.
Further, in order for the theoretical interest cover to be breached, profit
from operations, excluding the adjusting items, would have to decline by
14.05% per year for the interest cover to fall below 5x
after three years.
Other considerations - litigation
Due to the nature of the Group's operations, it is subject to inherent
uncertainties with regards to litigation, the outcome of which is uncertain in
terms of timing or scale and may have a
bearing on the Group's viability. The Group intends to defend all pending
cases vigorously, as referred to in note 31 in the Notes on the Accounts
'Contingent Liabilities and Financial Commitments'.
Whilst it is impossible to be certain of the outcome of any particular case,
the Group believes that the defences of the Group's companies to all these
various claims are meritorious on both the law and the facts.
However, if an adverse judgment is entered against any of the Group's
companies in any case, an appeal will be pursued, the duration of which can be
reasonably expected to last for a number of years.
Mitigating actions
Under the Group's active capital allocation mechanism (see page 40), the Group
intends to pay dividends of 65% of long-term sustainable earnings (2025: £5.2
billion) with other capital expenditure estimated at £750 million. Both may
be revised to redirect funds to the settlement of other liabilities, including
debt
repayment.
Conclusion
The Board has assessed the prospects and viability of the Group taking into
account the current position and Principal Risks, in accordance with provision
31 of the UK Corporate Governance
Code 2024.
Owing to the inherent uncertainty arising due to ongoing litigation, the
period over which the Board considers it possible to form a reasonable
expectation as to the Group's longer-term viability is three years, in line
with the Group's cash flow forecasting to support debt refinancing plans.
Based on this assessment, the Directors have a reasonable expectation that the
Group will be able to continue in operation and meet its liabilities as they
fall due over the three-year period to 31 December 2028.
Notes:
* A credit rating is not a recommendation to buy, sell or hold securities. A
credit rating may be subject to withdrawal or revision at any time. Each
rating should be evaluated separately of any other rating.
** Interest cover is based on adjusted EBITDA to interest expense.
APPENDIX B
RELATED PARTY DISCLOSURES
The Group has a number of transactions and relationships with related parties,
as defined in IAS 24 Related Party Disclosures, all of which are undertaken in
the normal course of business. Transactions with CTBAT International Limited
(a joint operation) are not included in these disclosures as the results are
immaterial to the Group.
Intercompany transactions and balances are eliminated on consolidation and
therefore are not disclosed.
Transactions and balances with associates relate mainly to the sale and
purchase of cigarettes and tobacco leaf and the provision of IT services.
Included in the purchase of goods and services below is £144 million (2024:
£116 million; 2023: £145 million) relating to the purchase of leaf.
Investments in associates, in the form of convertible loan notes, are not
included in the table below. The Group's share of dividends from associates,
primarily received from ITC and included in other income in the table below,
were dividends received in cash of £386 million (2024: £447 million; 2023:
£559 million) as well as £533 million from ITC received in the form of
shares in ITC Hotels as explained below.
2025 2024
£m £m
Transactions
- gross revenue* 500 492
- purchase of goods and services (221) (192)
- other income 945 448
Amounts receivable at 31 December 92 39
Amounts payable at 31 December (2) (12)
Note:
* Gross revenue is based on the invoice issued to the related party.
In addition, the following related party transactions occurred in 2025, 2024
and 2023.
Transactions with associates
ITC
Hotel demerger:
On 24 July 2023, ITC announced a proposed demerger of its 'Hotels Business'
under a scheme of arrangement by which 60% of the newly incorporated entity
would be held directly by ITC's shareholders proportionate to their
shareholding in ITC. In January 2025, ITC Hotels was listed and commenced
trading on the National Stock Exchange of India (NSE) and Bombay Stock
Exchange (BSE). The Group's direct stake in ITC Hotels was initially 15% and
has been recognised as an investment held at fair value (refer to note 18).
Partial sale of shares:
On 28 May 2025, the Group completed the divestment of 10% of its equity stake
in ITC (the equivalent of 2.5% of ITC's ordinary shares) to institutional
investors by way of an accelerated bookbuild process which generated net
proceeds after transaction costs and taxes of INR121.0 billion (£1.0
billion). Following completion of the transaction, the Group has continued to
account for ITC as an associated undertaking using the equity method of
accounting.
On 13 March 2024, the Group announced the divestment of 12% of its equity
stake in ITC (the equivalent of 3.5% of ITC's ordinary shares) to
institutional investors by way of an accelerated bookbuild process which
generated net proceeds after transaction costs and taxes of
INR166.9 billion (£1.6 billion).
Sale of brands and investment:
During 2025, the Group sold its 2% investment in Surya Nepal Pvt. Limited and
brand rights in certain jurisdictions to ITC for £24 million.
Organigram
In 2023, the Group announced the signing of an agreement for a further
investment of CAD$125 million (£74 million) in Organigram, subject to
customary conditions, including necessary approvals by the shareholders of
Organigram, which was given on 18 January 2024. On 24 January 2024, the Group
made the first tranche investment of CAD$42 million (£24 million) acquiring a
further 12,893,175 common shares of Organigram at a price of CAD$3.22 per
share. On 30 August 2024, the Group made the second tranche investment of
CAD$42 million (£24 million) acquiring a further 4,429,740 common shares and
8,463,435 preferred shares of Organigram at a price of CAD$3.22 per share. On
28 February 2025, the Group made the third and final tranche investment in
Organigram for CAD$42 million (£23 million) subscribing for 7,562,447 common
shares and 5,330,728 preferred shares at the same price as the previous two
tranches. Under the terms of the agreement, the Group's voting rights are
restricted to 30%.
The Group and Organigram also have a Product Development Collaboration
Agreement following which a Centre of Excellence was
established to focus on developing the next generation of cannabis products
with an initial focus on cannabidiol (CBD).
Other associates
The following transactions occurred during 2025:
- On 18 December 2025, the Group sold its 45.40% investment in FE
"Samfruit" JSC for less than £1 million.
The following transaction occurred during 2024:
- On 11 September 2024, VST Industries Ltd (VST) allotted 154,419,200
equity shares of INR10 each as fully paid-up bonus equity shares.The bonus
equity shares were allotted in the proportion of 10 new fully paid-up equity
shares for every one existing fully paid up equity share. The Group's interest
in VST remains unchanged at 32.16%.
The following transactions occurred during 2023, when the Group:
- acquired 19.9% of DeFloria, Inc for £8 million; and
- increased its ownership in Steady State LLC (trading as Open Book
Extracts) from 5.76% to 10.8% for £4 million along with a further investment
of £8 million by way of a convertible loan note.
Non-controlling interests
During 2025, the Group acquired 2.60% of JSC JV "UZBAT A.O." for £16 million,
increasing the ownership to 99.99%. In addition, the Group acquired 5% of
British American Tobacco Mozambique Limitada for £3 million, increasing the
ownership to 100%.
During 2023, the Group acquired 1.31% in Hrvatski Duhani d.d., at a cost of
less than £1 million.
Other related party transactions
In 2022, the Group provided a temporary liquidity facility to the main UK
pension fund. The facility was undrawn as at 31 December 2023 and on 28 March
2024 the facility was cancelled.
As a result of the implementation of the EU Single-Use Plastic Directive in
certain EU countries, the Group, along with other tobacco manufacturers,
established Producer Responsibility Organisations for the management of the
Extended Producer Responsibility obligations relating to tobacco product butt
filter waste collection. The costs incurred by the Group in relation to this
waste disposal
is included in note 33.
The key management personnel of British American Tobacco consist of the
members of the Board of Directors of British American Tobacco p.l.c. and the
members of the Management Board. No such person had any material interest
during the year in a contract of significance (other than a service contract)
with the Company or any subsidiary company. The term key management personnel
in this
context includes their close family members.
2025 2024 2023
£m £m £m
The total compensation for key management personnel, including Directors, was:
- salaries and other short-term employee benefits
26 21 17
- post-employment benefits 1 1 1
- share-based payments 18 12 14
45 34 31
The following table, which is not part of IAS 24 disclosures, shows the
aggregate emoluments of the Directors of the Company.
Executive Directors Chair Non-Executive Directors Total
2025 2024 2023 2025 2024 2023 2025 2024 2023 2025 2024 2023
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Salary; fees; benefits; incentives
- salary 1,935 1,907 1,644 1,935 1,907 1,644
- fees 736 711 688 1,083 1,112 1,059 1,819 1,823 1,747
- taxable benefits 606 617 395 19 17 17 394 79 31 1,019 713 443
- short-term incentives 3,560 3,496 1,650 3,560 3,496 1,650
- long-term incentives 1,954 1,474 1,371 1,954 1,474 1,371
-buy-out - 2,969 - 2969 -
Sub-total 8,055 10,463 5,060 755 728 705 1,477 1,191 1,090 10,287 12,382 6,855
Pension; other emoluments
- pension 281 276 248 281 276 248
- other emoluments 8 6 2 8 6 2
Sub-total 289 282 250 289 250 250
Total emoluments 8,344 10,745 5,310 755 728 705 1,477 1,191 1,090 10,576 12,664 7,105
APPENDIX C
RESPONSIBILITY OF DIRECTORS
Statement of Directors' Responsibilities in Respect of the Annual Report and
the Financial Statements
The Directors are responsible for preparing the Annual Report and the Group
and Parent Company financial statements in accordance with applicable law and
regulations. Under company law, directors must not approve the Financial
Statements unless
they are satisfied that they give a true and fair view of the state of affairs
of the Parent Company and the Group for that period.
Under applicable law, directors are required to prepare the financial
statements in accordance with UK-adopted international accounting standards
and applicable law. The Directors have elected to prepare the Parent Company
financial statements in accordance with UK Accounting Standards and applicable
law, including FRS 101 'Reduced Disclosure Framework'. In preparing these
Group financial statements, the Directors have also elected
to comply with International Financial Reporting Standards (IFRS) as issued by
the International Accounting Standards Board (IASB).
In preparing each of the Group and Parent Company financial statements, the
Directors are required to:
- select suitable accounting policies and then apply them
consistently;
- make judgements and estimates that are reasonable, relevant,
reliable and prudent;
- state whether Group financial statements have been prepared in
accordance with UK-adopted international accounting standards;
- state whether, for the Parent Company financial statements,
applicable UK Accounting Standards have been followed, subject to any material
departures disclosed and explained in those statements;
- assess the Group and Parent Company's ability to continue as a going
concern, disclosing, as applicable, matters related to going concern; and
- use the going concern basis of accounting unless the Directors
either intend to liquidate the Group or the Parent Company or to cease
operations, or have no realistic alternative but to do so.
The Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Parent Company's transactions and disclose
with reasonable accuracy at any time the financial position of the Parent
Company and enable them to ensure that its financial statements comply with
the UK Companies Act. They are responsible for such internal control as they
determine is necessary to enable the preparation of financial statements that
are free from material misstatement, whether due to fraud or error, and have
general responsibility for taking such steps as are reasonably open to them to
safeguard the assets of the Group and to prevent and detect fraud and other
irregularities.
Under applicable law and regulations, the Directors are also responsible for
preparing a Strategic Report, Directors' Report, Directors' Remuneration
Report and Corporate Governance Statement that comply with applicable law and
regulations.
The Directors are responsible for the maintenance and integrity of the Annual
Report included on the Company's website. Legislation in the UK governing the
preparation and dissemination of financial statements may differ from
legislation in other jurisdictions.
In accordance with Disclosure Guidance and Transparency Rule (DTR) 4.1.16R,
the financial statements will form part of the annual financial report
prepared using the single electronic reporting format under DTRs 4.1.17R and
4.1.18R. The auditor's report on these financial statements provides no
assurance over whether the annual financial report has been prepared in
accordance with those requirements.
Directors' Declaration in Relation to Relevant Audit Information
Having made appropriate enquiries, each of the Directors who held office at
the date of approval of this Annual Report confirms that:
- so far as he or she is aware, there is no relevant audit information
of which the Company's auditors are unaware; and
- he or she has taken all steps that a Director ought to have taken in
order to make himself or herself aware of relevant audit information and to
establish that the Company's auditors are aware of that information.
Responsibility Statement of the Directors in Respect of the Annual Financial
Report
We confirm that to the best of our knowledge:
- the financial statements, prepared in accordance with the applicable
set of accounting standards, give a true and fair view of the assets,
liabilities, financial position and profit or loss of the Company and the
undertakings included in the consolidation taken as a whole; and
- the Strategic Report and the Directors' Report include a fair review
of the development and performance of the business and the position of the
Company and the undertakings included in the consolidation taken as a whole,
together with a description of the principal risks and uncertainties that they
face.
Cautionary Statement
This document contains certain forward-looking statements, including
"forward-looking" statements made within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995. These statements are often, but not
always, made through the use of words or phrases such as "believe,"
"anticipate," "could," "may," "would," "should," "intend," "plan,"
"potential," "predict," "will," "expect," "estimate," "project," "positioned,"
"strategy," "outlook," "target," "being confident" and similar expressions.
These include statements regarding our intentions, beliefs or current
expectations concerning, amongst other things, our results of operations,
financial condition, liquidity, prospects, growth, strategies and the economic
and business circumstances occurring from time to time in the countries and
markets in which the Group operates.
In particular, these forward-looking statements include, among other
statements, statements regarding the Group's future financial performance,
planned product launches and future regulatory developments and business
objectives, as well as certain statements in (i) the Strategic Report Overview
section (pages 2 to 7), including Our Business at a Glance - Our purpose,
vision and mission, the Chair's Introduction and the Chief Executive's Review;
(ii) the Strategic Report - Our Strategy section (pages 10 to 25), including
the Our Strategic Navigator section, the Our Business Model section, the
Interim Chief Financial Officer's Overview and the Our Markets and Megatrends
section; (iii) the Strategic Report - Our Strategic Pillars - Strategic Pillar
Overview - Quality Growth sections (pages 26 to 37), including Managed
Combustible Transition, Wellbeing and Stimulation and Regulation and PMTA
under Our Vapour Products; (iv) the Strategic Report - Our Strategic Pillars -
the Strategic Pillar Overview - Dynamic Business section (pages 38 to 59),
including Operational Excellence, Cash Generation, Maximising our Investments,
Reducing Debt, Generate Sustainable Returns, the Update on regulations in the
U.S. section and the Financial Performance Summary, including Dividends,
Treasury, Liquidity and Capital Structure, the Group's expected capital
expenditure in 2026, the Group's confidence in being able to successfully
access the debt capital markets and Assessment as a Going Concern; (v) the
Strategic Pillar Overview - Sustainable Future sections (pages 60 to 164),
including the Sustainable Future section, the Message from our Chief
Sustainability Officer, Our new 2030 sustainability targets section, the
Double Materiality Assessment section, the THR section, the Climate section,
the Nature section, the Circularity section, the Communities section, and the
TCFD reporting and TNFD Disclosures section; (vi) the Viability Statement
(page 176); and (vii) certain statements in the Notes on Accounts (pages 257
to 354), including the Group's ability to navigate regulatory change on page
288.
All such forward-looking statements involve estimates and assumptions that are
subject to risks, uncertainties and other factors. It is believed that the
expectations reflected in this document are reasonable but they may be
affected by a wide range of variables that could cause actual results and
performance to differ materially from those currently anticipated.
Among the key factors that could cause actual results to differ materially
from those projected in the forward-looking statements are uncertainties
related to the following: the impact of increased competition from illicit
trade and illegal products; changes or differences in domestic or
international economic or political conditions; the impact of adverse domestic
or international legislation and regulation of tobacco, New Categories and
other regulation; the impact of supply chain disruptions; adverse litigation
and external investigations and dispute outcomes and the effect of such
outcomes on the Group's financial condition; the impact of significant
increases or structural changes in tobacco, nicotine and New Categories
related taxes; the inability to develop, commercialise and deliver the Group's
New Categories strategy; adverse decisions by domestic or international
regulatory bodies, including disputed taxes, interest and penalties; the
impact of serious injury, illness or death in the workplace and those who work
with the business; the ability to maintain credit ratings and to fund the
business under the current capital structure; translational and transactional
foreign exchange rate exposure; direct and indirect adverse impacts associated
with climate change (both physical and transition); the ability to deliver a
viable circular business model in response to global demand, combined with
increasing regulatory, stakeholder and consumer pressure; and the Group's
ability to defend against Cyber & Digital actions that result in loss of
confidentiality, availability or integrity of systems and data. Further
details on the principal risks that may affect the Group can be found in the
Group Principal Risks section of the Strategic Report on pages 166 to 175 of
this document.
Past performance is no guide to future performance and persons needing advice
should consult an independent financial adviser. The forward-looking
statements reflect knowledge and information available at the date of
preparation of this document and the Group undertakes no obligation to update
or revise these forward-looking statements, whether as a result of new
information, future events or otherwise. Readers are cautioned not to place
undue reliance on such forward-looking statements.
No statement in this document is intended to be a profit forecast and no
statement in this document should be interpreted to mean that earnings per
share of BAT for the current or future financial years would necessarily match
or exceed the historical published earnings per share of BAT.
All financial statements and financial information provided by or with respect
to the U.S. or Reynolds American are initially prepared on the basis of U.S.
GAAP and constitute the primary financial statements or financial records of
the U.S./Reynolds American. This financial information is then converted to
International Financial Reporting Standards as issued by the IASB and as
adopted for use in the UK (IFRS) for the purpose of consolidation within the
results of the Group. To the extent any such financial information provided in
this announcement relates to the U.S. or Reynolds American it is provided as
an explanation of, or supplement to, Reynolds American's primary U.S. GAAP
based financial statements and information.
Although financial materiality has been considered in the development of our
Double Materiality Assessment (DMA), our DMA and any conclusions in this
document as to the materiality or significance of sustainability matters do
not imply that all topics discussed therein are financially material to our
business taken as a whole, and such topics may not significantly alter the
total mix of information available about our securities.
Products sold in the U.S., including Vuse, Velo, Grizzly, Kodiak, and Camel
Snus, are subject to FDA regulation and no reduced-risk claims will be made as
to these products without agency clearance.
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