British American Tobacco PLC announced an increased £1.3 billion share buyback for 2026 as results for last year beat City forecasts by a cigarette paper, but growth expectations for the coming year were dampened down.
Adjusted operating profit rose 2.3% to £11.57 billion in the 2025 calendar year, just ahead of market expectations of £11.45 billion. Adjusted diluted earnings per share of 352p also beat forecasts of 340p.
Reported revenue fell 1.0% due to currency headwinds but rose 2.1% at constant exchange rates. Growth was driven by combustibles (ie cigarettes and rolling tobacco) and its Velo Plus nicotine pouches in the US.
Group revenue from Velo and other 'new categories' products rose 7% for the year and returned to double-digit growth in the second half.
The contribution from new categories increased 77.1% to £442 million, with smokeless brands adding 4.7 million consumers to 34.1 million and smokeless products accounting for 18.2% of group revenue, up 70 basis points.
The dividend was hiked 2% to 245.04p, alongside the planned buyback, which increased from £1.1 billion the year before.
Chief executive Tadeu Marroco said: “I am pleased with our accelerating momentum through 2025, enabling full-year delivery at the top end of our guidance.”
For 2026, the group expects performance at the lower end of its medium-term ranges, including revenue growth of 3-5% and adjusted diluted EPS growth of 5-8%.