BAT ups revenue guidance as non-combustibles grow

British American Tobacco increased its guidance for annual revenue growth as it attracted more non-combustible product customers and reported a solid performance for its tobacco brands.

The FTSE 100 group said it expected revenue to rise by more than 5% at constant currency this year - up from an earlier forecast of 3-5%. Adjusted, diluted earnings per share will rise by mid-single digits at constant currency, BAT predicted.

BAT said it acquired 1.4 million customers for vaping and other non-combustible products during the first half and that it gained market share across all three categories. Combustibles revenue was supported by a recovery in emerging markets such as Bangladesh and Pakistan and strong growth in the US.

Chief Executive Jack Bowles said: "We are accelerating our transformation with increased investment capitalising on our growing momentum in the new categories, and a record quarter for consumer acquisition. This, together with our strong business performance, is reflected in our upgraded group revenue growth guidance."

Cashflow conversion will be more than 90% and adjusted net debt to adjusted earnings will drop to about three times by the year end, BAT said.