Imperial unveils £1.1bn buyback ahead of FY results

The company said it will buy back £1.1bn in shares between 6 October 2023 and the end of September 2024, representing 8% of its share capital and a 10% increase on last year's buyback.

"This commitment forms part of an ongoing, multi-year buyback programme that will deliver a material reduction in the capital base over time, which, together with our progressive dividend policy, will provide an ongoing source of shareholder returns," Imperial said.

In a pre-close trading update for the fiscal year ended 30 September, the Lambert & Butlers and Golden Virginia maker said strong tobacco pricing has driven constant currency net revenue and adjusted operating profit growth.

On a constant currency basis, the company expects low single-digit growth in revenues even when accounting for its now-exited Russian business which contributed to the top line last year.

Group adjusted operating profit growth will come in at the lower end of the mid-single digit range, as previously guided to.

During the second half, Imperial said it saw an acceleration in growth in next generation product (NGP) revenues – heated tobacco, vapes and tobacco-free oral nicotine pouches – driven by strong growth in Europe.

Imperial said it has improved its market share across its top-five markets, marking three consecutive years of improved market share performance following several years of decline. Similar to the first half, the second half saw market share growth in the US, Spain and Australia, more than offsetting declines in Germany and the UK.

Meanwhile, gearing has improved, with net debt to EBITDA leverage expected to be around 2.0 for the year, slightly better than 2.0-2.5 range guided to at the half-year stage.