BRISTOL (dpa-AFX) - Imperial Brands plc. (IMB.L), in a trading update ahead of its close period on 1 April 2019, confirmed that it is on track to meet constant currency net revenue and earnings expectations for the full year, with Group net revenue growth at, or above, the upper end of 1%-4% revenue growth range and earnings per share growth within its 4%-8% guidance range.
Operating profit in the first half reflects continued underlying growth in Tobacco profits albeit more than offset by increased investment in blu of 100 million pounds, as highlighted in November.
The company noted that first half earnings per share will also be impacted by the reduction of our Logista stake and last year's divestment of Other Tobacco Products business. It continues to expect to realise 50 million pounds-100 million pounds of other gains this year which will benefit the second half.
Translation FX at current rate of exchange is expected to benefit first half earnings by about 2% and be flat for the full year.
Underlying cash conversion remains strong and the company expects full year cash conversion will be around 90%. As guided, first half cash conversion will reflect the timing of Logista cash flows and the working capital investment to support the UK business through Brexit.
In Tobacco, the company is on track to deliver modest revenue growth in Tobacco with growth weighted to second half, more than offsetting a slight decline in the first half. Price/mix continues to be strong, while volume trends are slightly behind the second half of last year impacted by the phasing of trade inventories, including in the US post our recent price increase.
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