BAT signals possible job cuts as operating units cut in restructure

British American Tobacco said it was cutting the number of business units it operates and restructuring its regional set up as part of a strategic review that could see job cuts.

The number of regions will be reduced from four to three, and the number of business units from 16 to 12 with the changes taking effect from April, the maker of Peter Stuyvesant and Lucky Strike cigarettes said on Tuesday. It is now consulting "in some jurisdictions".

BAT also said it would ramp up up ongoing “market exit plans” under the restructure, signalling further moves to pull out of certain countries, having already halted operations in Myanmar, Iran and Russia in recent years.

“The new structure will increase the efficiency of BAT’s geographical footprint, optimise market prioritisation and will be based on fewer, larger business units, enabling even greater collaboration and accelerated decision-making across BAT,” it added.

BAT's new structure will consist of three regions: USA (Reynolds American Inc.), Americas & Europe and Asia Pacific, Middle East & Africa.

In addition, two new management board roles will be created: chief transformation officer and a director responsible for its combustibles operations.

“The chief transformation officer will be responsible for driving faster transformation, accelerating greater capability build in key areas and enabling an even faster, simpler and more agile organisation. The role of director, combustibles will lead the focus on driving value from combustibles to fuel further investment in new categories,” BAT said.

Reporting by Frank Prenesti for Sharecast.com