British American Tobacco (BAT) said in its half-year report that revenue and operating profit for the 6 months ended 30 June, increased by 1.9 per cent and 2.4 per cent respectively over the comparable period in 2017. Both figures were adjusted for constant currency, and reported on a "representative Basis" to adjust for the distorting effect of acquisitions made last year.

The representative basis given for figures in the report assumes BAT had owned Reynolds American Inc. (RAI), and other acquired companies, from 1 January 2017. Without adjusting for the multinational’s 2017 acquisitions, revenue for the six-month period ended 30 June increased by 56.9 per cent to reach GBP 11.636 billion (EUR 13.051 billion), and operating profit increased by 72.4 per cent to reach GBP 4.818 billion.
On a representative basis, combined cigarette and heated tobacco unit volume fell by 2.2 per cent. Without adjusting for the acquisitions, combined cigarette and heated tobacco unit shipments increased by 11 per cent, with 38.6 billion sticks having been shipped in the US, compared to zero in the same period in 2017. The company shipped 345 billion cigarettes in the first half of this year, and 3.3 billion heated tobacco units.
Oral tobacco product volume, at 4.4 billion units, increased by 2 per cent on a representative basis over the period. The increase was driven predominantly by the RAI oral tobacco portfolio, BAT said. In the OTP category, which includes RYO and MYO tobacco, BAT shipped 10.3 billion stick equivalents, which, on a representative basis, meant a decrease of 8.5 per cent in OTP volume when compared to the first half of 2017. BAT said this was due to lower volumes in the US and competitive pricing in France and Hungary.
BAT collected GBP 427 million in revenue from its Next Generation Products (NGP) portfolio over the period, an increase of 167 per cent when adjusted for the company’s acquisitions. In the vapour category, BAT shipped 77.6 million 10ml units, up 16.5 per cent on a representative basis. And revenue from heated tobacco products, at GBP 305 million, was up by more than 750 per cent compared to the same period in 2017. BAT said it remains confident in exceeding GBP 1 billion in revenue from its NGP portfolio in 2018, despite slowed uptake of heated tobacco products in key markets Japan and South Korea.
Chief Executive Nicandro Durante commented that Bat had performed well over the period, outperforming industry with its cigarettes and heated tobacco products. “The performance of Reynolds American Inc. (RAI) since acquisition is encouraging and the Group’s diverse NGP portfolio has grown strongly,” Durante said.