Imperial Brands reported revenue of £35.56 billion ($47.16 billion) in its fiscal year 2020, up from £31.59 billion in 2019. Its operating profit was £2.73 billion, compared with £2.2 billion the previous year. On an adjusted basis, the company’s revenue was £7.99 billion in 2020, down 0.1 percent from 2019. Adjusted operating profit was £3.53 billion, against £3.74 billion the previous year.
While benefiting from strong tobacco volumes, Imperial Brands said it suffered from a sub-optimal product and market mix in 2020. However, a more disciplined approach in next-generation products reduced second-half losses after a disappointing first six months, the company added.
“Although this has been a difficult year, the resilience of our tobacco business and the measures we have taken to improve our NGP [next-generation product] operations reinforce my confidence in the future potential of the business,” said Imperial Brands CEO Stefan Bomhard in a statement. “With a more disciplined focus and better execution we can realize significant value for our stakeholders over time.
“My first months have been focused on engaging with employees, consumers and customers and leading the strategic review of the business,” added Bomhard, who joined the company earlier this year. What I have seen to date confirms my view of the group’s solid foundations. I believe there is scope to enhance returns from our tobacco business and opportunities to strengthen our NGP delivery over time. I firmly believe we can make a meaningful contribution to harm reduction within a more disciplined, returns focused framework and we have already taken steps to stem the NGP losses.”
Imperial Brands completed the sale of its premium cigars business on Oct. 29. It will use the proceeds to reduce debt. In recent months, the company has strengthened its executive team with external leadership appointments providing fresh skills and perspectives. A comprehensive strategic review is underway with a capital markets update scheduled for Jan. 27, 2021.