BAT lights up gloom
BRITISH American Tobacco, the world’s second-biggest cigarette maker yesterday reported a 17 per cent rise in nine-month earnings.
BAT, maker of Dunhill, Kent, Pall Mall and Lucky Strike, said its range of differently priced brands and its wide geographic spread mitigated the effects of any consumer downturn.
It saw strong growth in eastern Europe, with volumes up 4 per cent compared with its markets in Japan and Canada.
Chairman Jan du Plessis said: “Although there is a general concern about the prospects for the world economy and consumer behaviour in the next couple of years, these results demonstrate there has been no discernible effect on British American Tobacco.”
BAT’s shares have shown tobacco’s defensive qualities so far this year, outperforming the FTSE 100 index by more than 40 per cent. The shares fell 129p to 1690p.
A Citigroup research note said: “We rate BAT as ‘low risk’.
“Tobacco is a fairly steady industry and BAT has by far the greatest geographical diversification of any tobacco company.”