FULL YEAR RESULTS STATEMENT

17 November 2020
TAKING ACTION TO STRENGTHEN PERFORMANCE
Business Highlights
  • Business overcame the challenges posed by COVID-19; securing the safety and wellbeing of employees and responding to changes in consumer behaviour
  • Tobacco volumes strong but sub-optimal product and market mix result in weak gross profit contribution
  • A more disciplined approach in NGP reduced H2 losses after a disappointing H1
  • Strengthened Executive Team with key external leadership appointments providing fresh skills and perspectives to complement existing experience
  • Comprehensive strategic review underway with a capital markets update scheduled for 27 January
  • Completed sale of Premium Cigars business on 29 October 2020; proceeds used to reduce debt
Financial Performance
  • Group net revenue up +0.8%
  • Tobacco volume decline of -2.1% reflecting better market size and share trends in several markets
  • Tobacco net revenue +1.8% but weaker mix impacting gross profit contribution
  • Moderation of NGP net revenue decline; H1: -43%, H2: -9% with FY down 27%
  • Adjusted EPS down -5.6% reflecting reduced tobacco profit with COVID-19 and regulatory costs; and losses in NGP
  • Reported EPS up 49.4% at 158.3p reflecting prior year impairment charge for Premium Cigar sale
  • Strong cash conversion 127%; 107% excluding timing benefit on duty payments
  • Annual dividend of 137.7 pence per share reflecting rebased payment announced in May

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