Price Rises and Pouches Fuel Tobacco Giant's Profits
Strong consumer demand for oral nicotine alternatives and strategic price increases on traditional cigarettes have delivered a significant boost to the annual profits of Imperial Brands. The company, which owns major brands like Golden Virginia tobacco, Winston cigarettes, and Rizla rolling papers, also confirmed that it has handed a staggering £10 billion to its shareholders over the past four years.
A Year of Robust Financial Performance
For the financial year ending in September 2025, the group announced that its total revenue reached £32.2 billion. While this figure was marginally down by 0.7% compared to the previous year, the underlying performance was stronger. When excluding duties and adjusted for constant currency rates, revenue actually grew by a healthy 4.1%.
Most importantly, the company's adjusted operating profit saw solid growth, increasing by 4.6% to reach £4 billion for the year. This demonstrates the resilience and profitability of its core business operations.
Next Generation Products Lead the Charge
A key driver of this success has been the impressive performance of Imperial Brands' 'next generation products' (NGPs). This category, which includes e-cigarettes, heated tobacco, and oral nicotine pouches, is designed to provide nicotine without the harmful smoke associated with burning tobacco.
Revenues from this fast-growing division surged by nearly 14% year-on-year. A major contributor to this growth is the company's ZoneX oral nicotine pouches, which are gaining significant traction in both the US and European markets. These small pouches, which come in various flavours and strengths, are placed between the gum and lip for nicotine absorption.
In the vaping space, the company's Blu e-cigarette brand successfully grew its share of the reusable vape market, with particularly strong performances in the UK, Spain, and France.
Simultaneously, the traditional tobacco business remained a powerful profit engine. Despite a decline in the volume of cigarettes sold, net revenues from this segment still grew by 3.7% year-on-year, thanks to an average price increase of 5.4%.
Looking ahead, Imperial Brands has commenced a substantial £1.45 billion share buyback scheme for the 2026 financial year. Chief Executive Lukas Paravicini stated: "Our performance in FY25 adds to our track record of consistent growth, demonstrating the sustainability of our tobacco business and the exciting growth opportunities in next generation products." The company forecasts its adjusted operating profit will grow by between 3% and 5% in the year ahead.
