British American Tobacco (BTI) Q4 2022 Earnings Call Transcript

For the period ending December 31, 2022

February 9, 2023 4:30 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Jack Bowles

Good morning everyone, and welcome to our 2022 Full Year Results Presentation. I am Jack Bowles, Chief Executive of BAT. With me this morning is Tadeu Marroco, our Group Finance and Transformation Director.

I am proud to share with you today that we have reached an exciting inflection point in our transformation. Over the last few years, New Categories have rapidly become a significant part of our business and are now a strong contributor to our financial performance. As a result, last week we announced our new regional structure and management team realignment to drive us through the next phase of our transformation journey.

Our presentation today will take on a new format. First, I will give some highlights of the progress. Tadeu will take you through the details of our results, highlighting how in 2022, we continued transforming the business, delivered strong financial results, and successfully navigated a challenging macro-economic environment.

Then I will talk about how we are taking BAT’s strategy to the next level, and why we are confident in bringing forward our New Category profitability target by one year to 2024, as our transformation accelerates. As usual, once Tadeu and I have taken you through the presentation, there will be an opportunity to ask questions.

Before we start, I would like to take this opportunity to give you an update on the progress of the transfer of our businesses in Russia and Belarus: As we have already shared, we are working as quickly as possible to transfer the businesses in compliance with international and local laws. We are now in advanced discussions with a joint management distributor consortium with a view to completing the transfer in 2023.

Our priority remains supporting our employees in the affected areas and safeguarding their employment. Upon completion, BAT will no longer have a presence in Russia and Belarus.

With that, I take it that you have all seen the disclaimer on slide two and Slide three. I am delighted to share with you today our progress and delivery against the three priorities we set out in 2019. We are, delivering a Step Change in New Categories, enabling us to bring forward our profitability target, driving value from our combustibles business, and at the same time, significantly simplifying BAT, our structure, processes and ways of working to drive greater efficiency.