BAT slips on buyback disappointment, sees Russia exit this 12 months By Reuters


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© Reuters. A employees of British American Tobacco Japan inserts a tobacco into its new tobacco heating system gadget ‘glo’ throughout an indication after a information convention in Tokyo, Japan, November 8, 2016. REUTERS/Kim Kyung-Hoon/Information

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By Sinchita Mitra and Muhammed Husain

(Reuters) – British American Tobacco (NYSE:) forecast a small rise in 2023 earnings on Thursday and dashed hopes of a share buyback, sending its shares down as a lot as 6%, because it additionally pledged to finish the sale of its Russian and Belarusian companies this 12 months.

The maker of Fortunate Strike cigarettes and Glo heated tobacco stated it anticipated a mid-single digit share enhance in earnings per share this 12 months in fixed currencies. Analysts are presently anticipating a 6.2% rise, in accordance with Jefferies.

The corporate additionally didn’t announce a brand new share buyback programme, as broadly anticipated by analysts.

BAT (LON:) had in February final 12 months introduced a buyback value as much as 2 billion kilos ($2.4 billion).

“The corporate is taking a ‘pragmatic’ method to capital allocation given macroeconomic, regulation, and litigation uncertainties, in addition to larger rates of interest,” JP Morgan stated in a word.

BAT is restructuring its administration and operations, and final month stated it could cut back the variety of areas in its enterprise from 4 to a few and develop its administration roles.

The group forecast on Thursday its 2023 income would rise 3-5% in fixed foreign money phrases, including development could be affected by the sale of its companies in Russia and Belarus.

Its shares have been down 4.4% at 1000 GMT.

BAT stated it was in superior discussions with a “joint administration distributor consortium” on the sale of its companies in Russia and Belarus, however didn’t reveal the identification of the occasion or disclose additional particulars on the talks.

The corporate’s distributor in Russia, SNS Group of Firms, stated in March final 12 months BAT was in talks to switch its Russian enterprise to SNS.

($1 = 0.8262 kilos)

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