Tobacco giant Imperial Brands PLC (LSE:IMB) will report its first-half results on Wednesday 14 May with its shares at their highest in over seven years, just as its five-year strategic plan comes to an end.
The FTSE 100 company, maker of JPS, Davidoff, Gauloises and Winston cigarettes, Blu vapes and Pulze heat-not-burn technology, is set to launch a new plan running to 2030, with CEO Stefan Bomhard telling analysts recently he will be targeting high single-digit annual earnings growth and between £2 billion and £3 billion in annual free cash flow to support rising dividends and share buybacks.
Key numbers in the results will be cigarette volume and market share in five core regions of the USA, UK, Germany, Spain and Australia. Progress in Next Generation Products will also be key, with 'Imps' aiming for double-digit annual revenue growth in that segment over the next five years.
Full-year guidance will be important, which currently stands at low single-digit revenue growth, mid single-digit operating profit growth, and high single-digit growth in earnings per share.
"Improved pricing, cost efficiencies and gains in next-generation products are helping offset falling cigarette volumes," said analysts at AJ Bell.
Imperial’s free cash flow is now nearly twice the level of its dividend outlay, they noted, with four equal dividend payments of 40.08p each. Alongside a £1.25 billion buyback, total returns to shareholders are forecast at £2.5 billion.