BAT Sticks To Earnings Forecast, Flags First Signs Of Sales Weakness
British American Tobacco said that it plans to maintain its guidance of high single figure earnings per share growth for 2020 while expecting some impact on volume and revenue growth in the second quarter due to the coronavirus.
The world's second-largest tobacco company expects 2020 constant currency adjusted revenue growth around the low end of the 3% to 5% range and will continue with its dividend pay-out ratio of 65% of adjusted diluted EPS and growth, it said.
It said that most of its factories are open and 'currently operating at full capacity', while 75% of its revenue is in developed markets where distribution and availability is largely unchanged.
It said that it has seen limited impact on consumer demand, although sales in travel retail have been 'significantly impacted'.
Supply Chain Resilience
"Despite ongoing uncertainties resulting from the COVID-19 pandemic, the resilience of our supply chain in combination with the dedication of our teams means that I am confident we will continue to deliver," commented BAT chairman Richard Burrows.
"We maintain our commitment to high single figure constant currency adjusted diluted EPS growth."