British American Tobacco p.l.c. (NYSE:BTI) Q4 2023 Earnings Conference Call February 8, 2024 4:30 AM ET

Company Participants

Tadeu Marroco - Chief Executive

Javed Iqbal - Interim Finance Director, and Director, Digital and Information

Victoria Buxton - Group Head of Investor Relations

Conference Call Participants

Richard Felton - Goldman Sachs

Faham Baig - UBS

Gaurav Jain - Barclays

Rashad Kawan - Morgan Stanley

Jonathan Leinster - Societe Generale

Joffrey Bellicha Meller - Bank of America Merrill Lynch

Tadeu Marroco

Good morning, everyone. I'm delighted to welcome you to our 2023 Preliminary Results Presentation. With me this morning is [Technical Difficulty] Finance Director and Victoria Buxton, Group Head of Investor Relations. I will begin with our financial highlights and the progress we have made against our key areas of focus this year. Javed will then take you through our financial performance in more detail. I will return to talk more about our glidepath to Building a Smokeless World, before we move to the Q&A session.

With that, I would like to draw your attention to the disclaimers on Slides 2 and 3. So let's begin with our 2023 performance. Our reported results reflect the impact of the non-cash impairment charge taken mainly against our acquired U.S. brands. We will focus on constant currency adjusted results, unless otherwise stated.

I am pleased that BAT has delivered a resilient performance, in line with our guidance, reflecting the benefit of our global multi-category strategy. The breadth and scale of our global footprint, enables us to consistently deliver balanced results. This is demonstrated by our strong performances in AME and APMEA, delivering combined double-digit revenue growth offsetting the U.S.

Overall, we have delivered, organic revenue up 3.1%, which excludes Russia and Belarus from both periods. Profit from operations up 3.1%, or 3.9% organically and diluted EPS up 4%, with organic growth up 5.2%. I am particularly pleased with our performance in new categories, with revenue up nearly 18%, and 21% organically, with Vuse and Velo delivering strong volume led revenue growth.

Our consumer numbers reached 23.9 million, excluding 1.5 million consumers in Russia. We added over 3 million consumers year-on-year with 1.1 million in Q4 alone. At the half year, I shared a clear set of objectives to sharpen our execution and build a more modern and agile BAT. Over the last six months, working together with our broader teams, we have made good progress across these six areas of focus.