BATS.L - British American Tobacco p.l.c.
| Previous Close | 2,682.00 |
| Open | 2,686.50 |
| Bid | 2,630.00 x 0 |
| Ask | 2,850.00 x 0 |
| Day's Range | 2,648.00 - 2,692.00 |
| 52 Week Range | 2,336.50 - 3,659.00 |
| Volume | 3,506,659 |
| Avg. Volume | 4,062,289 |
| Market Cap | 61.096B |
| Beta (3Y Monthly) | 1.43 |
| PE Ratio (TTM) | 9.92 |
| EPS (TTM) | 268.60 |
| Earnings Date | Feb. 20, 2019 - Feb. 25, 2019 |
| Forward Dividend & Yield | 2.03 (7.54%) |
| Ex-Dividend Date | 2019-12-24 |
| 1y Target Est | 3,825.26 |
- Reuters
Reynolds American files for FDA review of e-cigarette
The FDA has set a May 2020 deadline for e-cigarette makers to submit a formal application to keep their products on the market amid its efforts to curb the use of e-cigarette among teens. The Trump administration also outlined plans in September to remove all flavoured e-cigarettes from store shelves, pointing the finger at sweet flavours that had drawn millions of children into nicotine addiction.
- Bloomberg
Taking the Tobacco Out of Imperial Didn’t Fix Its Problems
(Bloomberg Opinion) -- Imperial Brands Plc’s Alison Cooper is stepping down in a cloud of raspberry scented smoke.The timing isn’t surprising. It comes exactly a week after the British-based maker of Davidoff cigarettes and the Blu electronic device, lowered expectations for sales and profits after taking a hit in the U.S. vaping market. The warning brought to a head discussions about the company’s future leadership as the board conducts its search for a successor to Chairman Mark Williamson.Change is clearly needed. The shares of the smallest of the world’s major tobacco companies are roughly back where they were at the start of Cooper’s 9-year watch, having lost more than half of their value since a 2016 peak.Her successor faces a tall order. The new CEO will have to figure out how to make Imperial a strong force in tobacco alternatives. It currently ranks fourth in electronic smoking devices by units sold on a four-week basis. But in the heat-not-burn segment, its Pulze product is a relative newcomer in the Japanese market, where the products have taken hold more quickly than elsewhere. It’s important to have a clear strategy in each segment since no one really knows exactly where the market’s headed.Finding the right path forward won’t be easy, given the crisis engulfing vaping in the U.S., which has prompted efforts by President Donald Trump to ban flavored products and nicotine pads while some retailers including Walmart Inc. have stopped selling e-cigarettes.They must find a way through this. One option would be developing a boarder suite of tobacco alternatives alongside Imperial’s Blu vaping device. Stepping up development in heat-not-burn segment would also be wise.Rival British American Tobacco Plc has hedged its bets, with a presence in both vaping and the heat-not-burn segment. This is a model that Imperial should follow. But this would likely mean more investment.Duncan Fox, an analyst at Bloomberg Intelligence, says Imperial can afford to spend more. First of all, it’s core business of traditional cigarettes — including local brands such as Winston in the U.S. — is cash generative. Plus, its 2 billion-pound ($2.5 billion) asset disposal program and decision to abandon its policy to increase its dividend by 10% annually should give it scope to act.The new chairman must also address corporate governance issues. Bloomberg News reported that investors and analysts had voiced concerns about Imperial’s earnings calculations and strategy.Imperial has long been seen as a takeover target, but it is now particularly vulnerable given the share price weakness and that industry consolidation is back on the agenda, even after Altria Group Inc. and Philip Morris International Inc. called off their merger talks.Japan Tobacco Inc. is often mooted as the likely predator, although it would have to find a way to deal with competition constraints.If the new chairman and chief executive don’t raise their game on alternatives, then someone else might light up even more radical change for them.To contact the author of this story: Andrea Felsted at afelsted@bloomberg.netTo contact the editor responsible for this story: Melissa Pozsgay at mpozsgay@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
- Bloomberg
Vaping Crisis Claims Its First British Victim
(Bloomberg Opinion) -- The crisis engulfing the American vaping industry has claimed its first European victim. Imperial Brands Plc, the British-based maker of Winston cigarettes in the U.S. and the Blu electronic device, cut its sales and profit guidance on Thursday, a day after Altria Group Inc. and Philip Morris International Inc. called off their merger talks amid increasing Washington scrutiny of illnesses associated with the smoking alternative.Imperial in part blamed a slowdown in U.S. demand for electronic cigarettes for its expectation of flat earnings in the year to Sept. 30. It had anticipated expansion of between 4% and 8%. Revenue will expand by 2%, at the low end of its 1% to 4% range. The shares fell as much as 11%.Some American retailers, including Walmart Inc. have stopped selling e-cigarettes, while President Donald Trump is moving to ban flavored products and nicotine pods. All of this came together to weigh on Imperial’s sales in the final quarter, when it was also running a big marketing campaign for its Blu device.So far the problems haven’t spread to Europe or Japan (the most developed market for devices that heat rather than burn tobacco). Imperial expects sales of its new generation products to increase by 50% this year. That may look eye-watering but it’s below previous expectations. This is a worry for all of Big Tobacco, which is investing billions of pounds in innovative new products. Philip Morris has developed the iQos “heat not burn” device, while British American Tobacco Plc has a suite of alternatives.The idea is that manufacturers use the cash flows from their traditional cigarettes business to develop products they describe as lower risk. As smoking rates decline, these devices are meant to pick up the slack among consumers. The transition hasn’t been smooth. Growth slowed in Japan last year, where older people proved more reluctant to follow tech-savvy early adopters of alternatives.The scrutiny in the U.S. is clearly a serious problem for this potentially huge, but nascent market. Yet there’s an irony too: The crackdown on vaping might drive some of the adults who’ve switched to vapes back to cigarettes.Although gross profit margins on alternatives are approaching those of cigarettes, according to Duncan Fox, an analyst at Bloomberg Intelligence, the traditional product remains the driver of profit and cash flow for the industry. A slower decline in the numbers of traditional tobacco smokers would be terrible for public health, but it might end up easing some of the financial pressure on Big Tobacco, at least in the short term. While the industry has always been a big dividend payer, there have been increasing doubts about whether this is sustainable.Greater regulation of alternatives could also play to the big companies’ advantage. Most — though not all — of the individuals who’ve fallen ill used black-market vaping pods. A tightening of the rules could favor the devices made by large manufacturers, which have decades of experience lobbying lawmakers. These companies have deep pockets for research and development too.Nevertheless, unless the industry can develop alternatives that are genuinely less harmful, the outlook for what was Big Tobacco’s last great hope looks bleak. Expect more vaping dreams to go up in smoke.To contact the author of this story: Andrea Felsted at afelsted@bloomberg.netTo contact the editor responsible for this story: James Boxell at jboxell@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
- Reuters
BAT says none of its e-cigs linked to U.S. vaping illnesses as far as it knows
U.S. health officials on Thursday said there were now 530 confirmed and probable cases and seven deaths from severe lung-related illnesses tied to vaping, up from just 380 cases reported a week earlier. "To the best of our knowledge, no product developed or manufactured by British American Tobacco (BAT) has been involved in these cases," said David O'Reilly, director of Scientific Research at the tobacco company. No e-cigarette or vaping product, substance, additive or brand has been consistently identified in the illness cases, nor has any one product or substance been conclusively linked to lung injury in patients, the Centers for Disease Control and Prevention (CDC) said on Thursday.
- The Guardian
British American Tobacco cuts 2,300 jobs in shift towards vaping
Company aims to increase revenues from ‘potentially reduced-risk products’ to £5bn. British American Tobacco (BAT) has announced plans to cut 2,300 jobs by 2020 in readiness for a shift towards non-tobacco products, a day after Donald Trump said he was considering a ban on flavoured e-cigarettes. The vast majority of BAT’s £24.5bn revenue in 2018 came from traditional cigarettes – its brands include Rothmans, Dunhill and Lucky Strike – but the company said it could save money to invest in alternative products such as vaping and heated tobacco by stripping out layers of management around the world. A spokesperson declined to say how many of the job cuts would fall in the UK, where 2,500 of its 55,000 staff are based, including at its London headquarters. The chief executive, Jack Bowles, who took over this year after the eight-year tenure of Nicandro Durante, said he wanted to make BAT “a stronger, simpler and faster organisation” that was ready for a future in which people moved away from cigarettes. He said BAT aimed to derive £5bn of its revenue from what it called “new category” or “potentially reduced-risk products” by the 2023/24 financial year. That would mean more than doubling the £1.8bn it made last year from vaping, tobacco-heated products and oral tobacco, which includes pouches such as Snus, popular in Scandinavia. On Wednesday Trump unveiled proposals to ban certain flavoured e-cigarettes in the US to limit their use by teens, amid concern about a mysterious lung illness has killed at least five people and hospitalised others. The US is a large and growing market for BAT’s vaping products, led by its flagship brand Vype. Of the £1.8bn it already makes from products other than cigarettes, £318m comes from vaping. A spokesperson for BAT declined to comment on whether Trump’s plans could punch a hole in its £5bn revenue target for “potentially reduced-risk products”. The company said: “We welcome the Trump administration and the FDA shining a spotlight on the important issue of youth access to vapour products. We have always been clear that youth should not use vapour products and have had stringent measures in place to address this for some time. “We share President Trump’s concern that some flavours, such as those resembling ‘kid-friendly’ food products, may play a role in increasing youth appeal and that marketing activities should not be directed to youth. “It is important to note that we do not market such vapour flavours and in fact we have supported measures to remove vapour products intended to mimic children’s food products or otherwise designed to target youth, and have procedures in place to ensure our products are only marketed to adult tobacco consumers.” BAT said it would continue to work with the FDA but made no mention of concern among US health professionals about potential links between vaping and lung disease.
- Reuters
BAT stubs out 2,300 jobs as new CEO tackles tobacco sector changes
Shares of the second-largest tobacco company by sales were up 1.6 %, the biggest boost to the broader FTSE index on Thursday, after the maker of Lucky Strike and Dunhill cigarettes said it will cut 2,300 roles as it eliminates duplication and consolidates business units. The move by BAT, which employed more than 56,000 people at the end of last year, 629 of them senior managers, comes a day after President Donald Trump said that the U.S. would remove all flavored e-cigarettes from shelves, as officials warned millions of children had been drawn into nicotine addiction.
- Reuters
UPDATE 3-Trump administration seeks ban on flavored e-cigarettes to combat youth addiction
WASHINGTON/LOS ANGELES, Sept 11 (Reuters) - The Trump administration announced plans on Wednesday to remove all flavored e-cigarettes from store shelves in a widening crackdown on vaping, as officials warned that sweet flavors had drawn millions of children into nicotine addiction. President Donald Trump and top U.S. officials expressed concern about surging teenage use of e-cigarettes, and the move comes as health officials are investigating a handful of deaths and potentially hundreds of lung illnesses tied to vaping. Health and Human Services Secretary Alex Azar said that, with Trump's blessing, the U.S. Food and Drug Administration was working on a "guidance document" that would lead to a ban of all e-cigarette flavors aside from tobacco flavoring.
- Yahoo Finance
Vaping device CEO calls for government regulation of industry after sixth vaping-related death
A sixth person died from lung disease related to vaping but the U.S. Centers for Disease Control and Prevention is still trying to determine what is making more than 450 people nationwide ill.
- Motley Fool
It's Not Cigarettes Bringing Altria and Philip Morris International Together Again
Smoking alternatives are the future of the tobacco industry and these industry giants.
- Bloomberg
One Big Tobacco Deal Is Enough
(Bloomberg Opinion) -- Something must be done. That’s often the response to a big deal like the planned $200 billion union between cigarette makers Philip Morris International Inc. and Altria Group Inc. For the duo’s competitors overseas, the temptation will be to indulge in some copycat dealmaking. In reality, bulking up would be a bad way to address their strategic challenges.There is some commercial logic in the tie-up of the two U.S. tobacco giants given their complementary businesses: each have sought to expand into alternative tobacco products in different ways. Altria took a minority stake in vaping group JUUL Labs Inc., while Philip Morris developed its IQOS system for heating rather than burning tobacco. Altria is focused solely on the U.S., Philip Morris on the rest of the world.Cost savings may be limited, but integration should be simple. Together, the pair can cross-sell some of their products in each other’s markets. By definition, there is no antitrust hurdle. It is harder to make comparable arguments for any combination involving British American Tobacco Plc, Japan Tobacco Inc. and Imperial Brands Plc.For BAT, which has a market value of 65 billion pounds ($79 billion), the appeal of a takeover of domestic rival Imperial, capitalized at 20 billion pounds, would merely be opportunistic and financial. Imperial’s shares have a dividend yield of more than 10%, a sign investors expect the annual payout will decline. The company’s net debt is forecast to fall to below three times Ebitda this year, whereas BAT’s net borrowings are expected to touch 3.6 times the same measure of profit. An all-share deal would therefore slightly improve BAT’s leverage and generate some cost savings from cutting duplicate functions.But such a transaction wouldn’t transform BAT’s position in tobacco alternatives. A slightly stronger financial position would be a modest benefit set beside the distraction of the integration and the likely need to make disposals to assuage antitrust concerns.Japan Tobacco, worth $42 billion, is substantially less geared, so an all-paper deal would achieve more in terms of reducing indebtedness. But it, too, could present antitrust issues for BAT. The presence of the Japanese government as lead shareholder would also be a complicating factor. It’s true both Imperial and Japan Tobacco are developing less risky tobacco products. But so, too, is BAT.One idea is that Japan Tobacco and BAT carve up Imperial’s geographical empire between them. The main outcome would, however, be to expand in conventional cigarettes. The wildcard buyer is Beijing-based China National Tobacco Corp.The only compelling M&A transaction would be one that enabled these companies to redeploy large parts of their manufacturing, marketing and distribution assets into products that weren’t just less harmful, but actually harmless. No banker has come up with that yet.The combination of Philip Morris and Altria may nudge others elsewhere toward M&A at some point. For now, the market’s caution around the mooted U.S. tie-up suggests the effect is going to be marginal. Don’t hold your breath for more deals.To contact the author of this story: Chris Hughes at chughes89@bloomberg.netTo contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Hughes is a Bloomberg Opinion columnist covering deals. He previously worked for Reuters Breakingviews, as well as the Financial Times and the Independent newspaper.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
- Motley Fool
5 Top Tobacco Stocks to Buy Now
With growth prospects and healthy dividend income, there's a tobacco stock that fits well in nearly any investor's portfolio.
- Motley Fool
4 Reasons Philip Morris International Shouldn't Merge With Altria
PMI shouldn’t agree to bail out Altria’s ailing domestic business.
- Zacks
Here's Why Philip Morris (PM) Stock is Down 4.7% in 3 Months
Philip Morris (PM) witnesses receding cigarette sales volumes. Nevertheless, advancement in low-risk tobacco alternatives is encouraging.
- Simply Wall St.
Examining British American Tobacco p.l.c.’s (LON:BATS) Weak Return On Capital Employed
Today we'll evaluate British American Tobacco p.l.c. (LON:BATS) to determine whether it could have potential as an...
- Reuters
British American Tobacco's takeover of Twisp wins South Africa approval
British American Tobacco's (BAT) proposed takeover of e-cigarette maker Twisp won approval from South Africa's Competition Tribunal on Tuesday after the UK-based group agreed to a series of conditions. The local unit of BAT, the world's second-largest tobacco company by sales, announced the deal in 2017 as part of its efforts to increase its offering of so-called next-generation products or alternatives to smoking cigarettes. BAT, like rivals, is striving for a bigger chunk of the global market for smoking alternatives as volumes of traditional cigarettes continue to slide.
- Thomson Reuters StreetEvents
Edited Transcript of BATS.L earnings conference call or presentation 1-Aug-19 8:30am GMT
Half Year 2019 British American Tobacco PLC Earnings Call
- Reuters
UPDATE 2-Shell, Fed stance weigh on FTSE 100; BoE action hurts mid-caps
London's FTSE 100 ended flat on Thursday despite a profit miss from Shell and dampened hopes of big U.S. interest rate cuts, while the mid-cap FTSE 250 index slipped after Brexit worries led the Bank of England to cut its growth forecasts. Losses were contained by BAT and as London Stock Exchange surged 6.5% to an all-time high after a deal to buy financial information firm Refinitiv, in which Reuters News parent Thomson Reuters holds a 45% stake.
- Simply Wall St.
What Are Analysts Saying About British American Tobacco p.l.c.'s (LON:BATS) Growth?
Based on British American Tobacco p.l.c.'s (LON:BATS) earnings update in December 2018, analyst consensus outlook...
- Motley Fool
How to Invest in Tobacco Stocks
There are several ways you can take advantage of investment opportunities in a tobacco industry that's currently in transition.
- Motley Fool
The 9 Biggest Tobacco Stocks
There aren't a huge number of U.S.-listed stocks with a tobacco focus, but these companies still combine to be a force in the global industry.
- Motley Fool
Why British American Tobacco, Neptune Wellness Solutions, and Union Pacific Jumped Today
Despite a turbulent broader market, good news lifted these shares.
- Simply Wall St.
British American Tobacco p.l.c. (LON:BATS): Is It A Good Long Term Opportunity?
In March 2019, British American Tobacco p.l.c. (LON:BATS) released its most recent earnings announcement, which...
- Reuters
BAT warns of steeper declines in cigarette sales, shares slip
The warning highlighted the challenges dogging the tobacco industry as smokers, particularly in the United States, turn to less harmful alternatives such as e-cigarettes and vaping products. The maker of Lucky Strike and Dunhill cigarettes said it expects global industry volumes to fall around 3.5% this year, compared with its earlier estimate of a 3% drop. BAT said it would invest further in what it calls its "New Category" business and announced plans to consolidate the portfolio, which makes tobacco heating product glo and Vype e-cigarettes as well as snuff and nicotine pouches.
