Imperial Tobacco cigarette equivalent volume fell 7 per cent in the fiscal year ended 30 Sept due to a shrinking global market and inventory reduction under a stock optimisation programme, the company said.

Volume of Imperial’s 10 growth brands increased 2 per cent, or 7 per cent when the impact of the stock optimisation programme is removed. Overall equivalent volume, which includes fine-cut production, fell 23 billion sticks to 294 billion, Imperial said.
Despite a 6 per cent decline in sales, operating profit rose 5 per cent to GBP 2.1 billion (EUR 2.7 billion).
“We’ve strengthened our brands and market footprint”, said Chief Executive Officer Alison Cooper. The stock optimisation programme has been completed. “We’ve achieved what we set out to achieve, creating a stronger business in the process”, she said. “Trading conditions remain tough in many territories.”
Imperial will expand its US business next year by acquiring Lorillard’s North Carolina manufacturing plant and secondary brands, a deal which the company said it expects would be completed in the spring of 2015. The transaction would make Imperial the third largest cigarette maker in the US, and Reynolds American would become the second largest behind Philip Morris USA through acquisition of Lorillard’s Newport brand.