Imperial Tobacco's solid trading statement caused its share price to rise by 2 per cent, reversing an extended period of profit-taking since the start of the year. In fact, the underlying 3 per cent rise in tobacco revenues came despite problems in several markets.
For example, sanctions on Syria, de-stocking in the Ukraine and major volume declines in Spain post a price war there last year contributed to a reported 7 per cent fall in the volume of cigarettes sold; 3 per cent of the decline was due to Syria sanctions and Spain, while the rest relates to increased prices in the US and de-stocking in the Ukraine. Tobacco revenues declined by 1 per cent before adjusting for these factors, but the benefit from a strengthening price mix helped offset the fall.
