ANNUAL REPORT
British American Tobacco looks to new products for growth
BAT reckons its traditional cigarette business will generate smouldering profits for the foreseeable future
The traditional cigarette business will generate smouldering profits for British American Tobacco (BAT) for the foreseeable future, but next-generation products are set to light up the bottom line in the longer term. Writing in BAT’s annual report, which was released on Monday, CE Nicandro Durante said the company made significant progress in 2016 with its differentiated strategy of developing and marketing a range of next-generation products and nicotine products. Next-generation products are mainly vapour products (battery-powered electronic devices that heat a solution to create a vapour, which is inhaled) and tobacco-heating products (devices with cartridges that contain tobacco). BAT’s annual report conceded that next-generation products were still a nascent market, but noted that the vapour products category was the largest of the two types and was growing at a significant rate. A 2015 estimate placed a value of $8bn on the global market, with about 29-million people vaping ar...
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