Tobacco volumes have fallen 3 per cent at cigarette giant Imperial Brands (IMB) in two successive financial years, but this makes sense in context of its aim to reduce the amount of brands it owns. Chief executive Alison Cooper said she was aiming to get to 125 brands, half the amount when she joined in 2007, and was now at 184. But the drop in volumes hasn't hit sales, with net tobacco revenue up 10 per cent on a constant-currency basis to £7.16bn. This suggests its strategy to focus on growth through specialist brands - which now make up 60 per cent of net tobacco revenue and continue to take market share - is working.
A major development was the announcement of a £300m investment programme targeting key markets and brands for the group's September 2017 year-end. Chief finance officer Oliver Tant said this would be balanced by an expected £100m uplift in sales and £90m-worth of cost savings, meaning a net investment of £110m. This will mean EPS growth is expected to be 4 per cent at most this financial year, but should return to between 4 and 8 per cent thereafter. The dividend will not be affected.