Imperial Brands on Track for FY25 Guidance, Announces £1.45bn Buyback

Imperial Brands PLC (LON: IMB) is on track to meet its full-year guidance for fiscal year 2025, underpinned by growth in both tobacco and next-generation products (NGP).

The company also announced a further £1.45 billion share buyback program for FY26, signaling confidence in its operational execution and strategic direction.

Trading is currently in line with expectations, with Imperial Brands anticipating market share gains in the US, Germany, and Australia.

The gains are expected to offset declines in Spain and the UK, reflecting a dynamic geographic performance. Another year of double-digit NGP net revenue growth is projected, contributing to the overall positive outlook.

The company said adjusted operating profit growth is expected to mirror the rate achieved in the previous year, aligning with previously issued guidance.

Adjusted earnings per share (EPS) are projected to grow at a high-single-digit rate, driven by the adjusted operating profit growth and the reduction in share count resulting from the ongoing buyback program.

The newly announced £1.45 billion share buyback for FY26 is consistent with Imperial Brands' capital allocation framework. The company anticipates completing the buyback no later than October 28, 2026.

Strong combustible pricing and further double-digit growth in the NGP business are underpinning constant currency tobacco and NGP net revenue growth.

While volume declines have eased across most regions, some volatility has been observed in certain markets. Full-year NGP net revenue growth, at constant currency, is expected to be around the mid-point of a 12-14% range.

High single-digit constant currency adjusted earnings per share growth is anticipated for the full year. This growth is supported by adjusted operating profit growth and the share buyback program, partially offset by higher adjusted finance and tax costs, as well as increased minority interests due to strong growth in some African markets.

Foreign exchange translation is expected to present a headwind of approximately 2.0 to 2.5% to net revenue and 2.5 to 3.0% to Group adjusted operating profit and earnings per share, based on current exchange rates. The average number of shares for the year was 824.8 million.

The company's adjusted operating cash conversion remains strong, and full-year leverage is expected to remain at the lower end of the 2.0 to 2.5 range for adjusted net debt to EBITDA. This financial stability provides a solid base for future growth and shareholder returns.

Taking dividends and buybacks together, Imperial Brands expects its capital returns to shareholders will exceed £2.7 billion in the coming fiscal year, representing approximately 11% of its current market capitalization.

Over the past five years, from FY21 to FY25, the company has delivered cumulative capital returns of approximately £10 billion to shareholders.