By Maximilian Clarke
Strong growth in emerging markets has helped deliver Imperial Tobacco (LSE: IMT) a 3% growth in revenue despite stagnation within the group’s key European Market.
The news had little effect on shares, which edged back 1% to 2302.00- down from a 52 week high of 2,444.00.
The tobacco giant behind Davidoff, Embassy, Gauloises and the UK’s top selling brand, Lambert & Butler, made headlines this morning (Thursday) after unsuccessfully challenging Scottish Parliament’s ruling to ban open displays of cigarettes. The decision, argued the company in a BBC article, went ‘beyond the legislative competence of Holyrood.’
Imperial’s 2011 performance remained largely unchanged within Europe beyond a few shifts including a growth in the group’s snus smokeless tobacco. An increasingly cost conscious EU populace, particularly in Germany and the UK, has driven a slight shift towards the company’s budget brands.
"Our continued focus on realising opportunities from our total tobacco portfolio supported by innovation and price optimisation has delivered underlying tobacco net revenue growth of 3% in the first quarter," commented the group’s Chief Executive, Alison Cooper.
"Combined stick equivalent volumes of our key strategic brands Davidoff, Gauloises Blondes, West and JPS were up 3 per cent and net revenues up 10 per cent with our focus on consumer relevant innovation and new formats driving growth in these brands in cigarette in emerging markets and fine cut tobacco in the EU."
"Delivering the planned acceleration in our underlying sales momentum whilst continuing to realise cost and cash opportunities remain our priorities such that we are well placed to create further value for our shareholders this year."
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