Imperial Brands edged above annual profit estimates in its first set of results under new CEO Lukas Paraviciniand forecast continued higher prices of its tobacco products alongside growing demand for smoking alternatives.
The maker of Davidoff cigarettes and blu e-cigarettes has promised 3%-5% annual profit growth and a share buyback programme every year until 2030 as it builds scale in smoking alternatives, and today forecast 2026 results to be in line with this forecast.
The company, which also owns nicotine pouch brand Zone and heated tobacco device Pulze, reported adjusted operating income of £3.99 billion for the year to September 30, compared with a consensus estimate of £3.98 billion, and up from £3.91 billion a year ago.
Sales and returns have rebounded after it retreated to focus on core markets and its tobacco business following an earlier misstep in vapes that eroded market share.
"During the next strategic period, we will evolve the distinctive challenger approach which has underpinned our recent success," said Paravicini, who replaced Stefan Bomhard as CEO in October.
The company said its revenue from tobacco and newer portfolio of smoking alternatives grew 4.1% to £8.32 billion in 2025.
"The combustibles business appears in good shape, with resilient volumes and continued pricing power, and the full-year 2026 guidance suggests this is likely to continue," Jefferies analysts said in a note.
"As such, the core Imperial Brands investment case of value maximisation in combustibles and elevated shareholder cash returns appears reinforced by today's print," they added.
Imperial's shares have risen by about 24% this year, outpacing the FTSE 100's 18.5% rise.
