Imperial hurt in recession-hit countries

Price rises helped lift Imperial Tobacco’s full-year revenue and offset a dip in volumes as the world’s fourth-largest cigarette group suffered in recession-hit Spain and tough markets in Poland and Ukraine.

The group, which sells over 340 billion cigarettes annually of brands such as Davidoff, Gauloises, JPS and West, said revenue would rise around four per cent for its year to end-September when stripping out currency fluctuations. Overall volumes were seen falling about three per cent.

Imperial aims to counter Europe’s downturn by offering economy-brand cigarettes, such as JPS and Lambert & Butler and roll-your-own products, while raising prices for more affluent consumers in western Europe and the United States.

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It said while growth was particularly strong in eastern Europe, Africa and the Middle East and also in its Asia Pacific region, volumes were hit by weakness in Poland, Spain and Ukraine, as well as by sanctions in Syria. Imperial has suffered in Ukraine due to increased illicit trade in cigarettes on which no duty has been paid.