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Imperial BrandsAnnouncement

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RNS Number : 2801A  Imperial Brands PLC  14 April 2026

IMPERIAL BRANDS PLC

 

Legal Entity Identifier (LEI) No. 549300DFVPOB67JL3A42

 

14 April 2026

 

Trading update: reiterating full-year guidance; positive start to 2030
transformation.

 

·      Robust tobacco pricing and NGP innovation expected to drive
low-single-digit percent growth in tobacco & NGP net revenue in H1(1).

·      Group adjusted operating profit expected to be slightly higher
compared to H1 2025(1), with growth accelerating in H2, in line with previous
guidance of a second-half weighted performance.

·      On track to deliver at least high-single digit earnings per share
growth(1) and at least £2.2 billion of free cash flow for the full year.

·      Completed £0.7 billion of the FY26 £1.45 billion share
repurchase, as part of "evergreen" share buyback programme to 2030

·      Continued momentum towards becoming more consumer-centric,
data-led, and efficient through long-term partnership with Capgemini, supply
chain footprint initiatives, and further roll-out of our enterprise IT
applications.

 

We reiterate our full-year guidance for FY26 of low-single-digit tobacco and
double-digit NGP net revenue growth, three to five per cent Group adjusted
operating profit growth and at least high-single-digit earnings per share
growth, all at constant currency, along with at least £2.2bn in free cash
flow. The conflict in the Middle East has resulted in a more uncertain
geopolitical and macro environment. Whilst there has been no material business
impact to date, the potential future impact during the second half remains
uncertain. We continue to monitor the situation and will give a further update
with our H1 results announcement on 12 May.

 

As guided, for H1 we expect low-single-digit percent growth in tobacco &
NGP net revenue(1). Tobacco net revenue is expected to show low-single-digit
percent growth(1), driven by robust pricing and low single digit combustible
volume decline. We continue to build scale in NGP and expect to grow share in
all three categories in H1, with NGP net revenue growth around mid-to-high
single digit percent(1), with double-digit growth in both of our Europe and
AAACE regions(1). This is driven by continued momentum in heated tobacco with
Pulze 3.0, particularly in Italy and Greece; in vape, where our blu kit range
continues to perform well; and in modern oral where new product launches in
Skruf and Zone in the Nordics and UK are driving performance.

 

While market share remains important, we continue to balance share and value.
Having successfully stabilised our aggregate share across our top five
markets, we continue to evolve our approach to reflect changing market
dynamics and our focus on more profitable segments, to deliver long-term,
sustainable value creation. As such, we anticipate some overall modest
aggregate share reduction across the top five markets in H1, alongside growth
in tobacco adjusted operating profit.

 

Group adjusted operating profit is anticipated to be slightly higher year on
year(1), with a strong performance in Europe and wider AAACE portfolio, offset
by US, Australia, and Logista. Tobacco adjusted operating profit is expected
to grow at a similar rate to last year(1), while NGP adjusted operating losses
are expected to be moderately higher. Performance will be weighted to the
second half of the year, as previously guided, with the step-up in adjusted
operating profit growth underpinned by the usual flow through of embedded
combustible pricing taken in the first half and the phasing of investment, as
we continue to build scale.

 

In the US, Zone continues to perform well, maintaining volume share as we
continue to build long-term brand equity, although due to heightened
promotional activity, NGP net revenue is expected to be lower than the same
period last year. Tobacco and NGP net revenue and adjusted operating profit
growth are expected to accelerate in the second half(1), underpinned in
combustibles by the flow-through of price increases already taken in the first
half and planned increases in H2; the launch in March of our new Malibu
cigarette brand; and in NGP by recent new flavour launches for Zone, alongside
a targeted channel strategy.

 

Our adjusted operating cash conversion remains strong on a 12-month basis, and
we are on track to deliver free cash flow of at least £2.2 billion for the
full year, in line with our guidance. Following the decision of the Supreme
Court of Delaware in December 2025, a payment of $200 million was made to R J
Reynolds in the first half of the financial year, with the remaining $234
million to be made in roughly equal instalments over the next three years.

 

We expect full-year leverage to remain at the lower end of our 2.0-2.5 range
for net debt to EBITDA.

 

We currently expect translation foreign exchange to be a c. 2.0-2.5 per cent
headwind on first-half earnings per share and a 0-1 per cent headwind on
full-year earnings per share.

 

During the first half we completed the £0.1 billion remaining of the share
buyback announced in October 2024 and as at 31 March 2026, we had completed
£0.7 billion of our £1.45 billion share buyback for this year. Combined,
this represents approximately 3.2% of the issued share capital as at 30
September 2025. We remain committed to returning surplus capital to
shareholders via our ongoing "evergreen" share buyback programme, which
represents an ongoing source of shareholder returns alongside our progressive
dividend policy.

 

We are pleased to report a good start to our 2030 strategy, with strong
momentum behind our execution and our transformation towards becoming a more
consumer-centric, data led, agile and efficient challenger. During the first
half, we began the implementation of our new long-term partnership with
Capgemini and took further action to focus on our supply chain footprint,
while continuing the rollout of our enterprise IT applications.

 

Interim results for the six months ended 31 March 2026 will be announced on 12
May 2026.

 

1.   All growth rates are at constant currency, unless otherwise stated.

 

ENDS

 

Notes:

The Group uses 'adjusted' (non-GAAP) measures as we believe they provide a
better comparison between reporting periods. The definition of our adjusted
measures is unchanged from our full-year results. We also use the term
'constant currency', which removes the effect of exchange rate movements on
the translation of the results of our overseas operations.

 

 Investor Contacts                     Media Contacts
 John Crosse      +44 (0)7484 967 842  Jonathan Oliver  +44 (0)7740 096 018
 Jennifer Ramsey  +44 (0)7974 615 739  Simon Evans      +44 (0)7967 467 684
 Henry Dodd       +44 (0)7941 648 421

 

Cautionary Statement

Certain statements in this announcement constitute or may constitute
forward-looking statements. Any statement in this announcement that is not a
statement of historical fact including, without limitation, those regarding
the Company's future expectations, operations, financial performance,
financial condition and business is or may be a forward-looking statement.
Such forward-looking statements are subject to risks and uncertainties that
may cause actual results to differ materially from those projected or implied
in any forward-looking statement. These risks and uncertainties include, among
other factors, changing economic, financial, business or other market
conditions. These and other factors could adversely affect the outcome and
financial effects of the plans and events described in this announcement. As a
result, you are cautioned not to place any reliance on such forward-looking
statements. The forward-looking statements reflect knowledge and information
available at the date of this announcement and the Company undertakes no
obligation to update its view of such risks and uncertainties or to update the
forward-looking statements contained herein. Nothing in this announcement
should be construed as a profit forecast or profit estimate and no statement
in this announcement should be interpreted to mean that the future earnings
per share of the Company for current or future financial years will
necessarily match or exceed the historical or published earnings per share of
the Company. This announcement has been prepared for, and only for the members
of the Company, as a body, and no other persons. The Company, its Directors,
employees, agents or advisers do not accept or assume responsibility to any
other person to whom this announcement is shown or into whose hands it may
come and any such responsibility or liability is expressly disclaimed.

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