Imperial Brands To Focus On Top Five Cigarette Markets In Turnaround Plan
Imperial Brands Plc on Wednesday laid out a five-year plan under its new chief executive that will focus on the company's top five cigarette markets, invest in more high-growth areas for its next-generation products and build out its sales ranks.
The maker of Kool and Winston cigarettes said it was also "resetting" its next-generation products (NGP) strategy, focusing its investments behind heated tobacco products in Europe and e-cigarettes in the United States.
'Six Month Review'
The announcement is the culmination of a six-month review by Stefan Bomhard, who joined as chief executive officer in July. He has since promised to turn around the struggling British company's performance, by bringing in new talent, changing incentive structures and culture, intensifying its focus in its top markets and delivering on its targets.
"We expect the new plan will deliver a gradually improving trajectory in net revenue over the five years with a compound annual growth rate of 1-2% from FY2020-2025," the company said ahead of its capital markets day event on Wednesday.
Imperial said the new changes will result in increased investments in areas such as sales and marketing by about 50 million to 60 million pounds per year, which will be funded by cost savings, and therefore will not impact operating profit, at least for the first two years.
Shares of the company, however, were down 5.2%.