Demand for oral nicotine and higher cigarette prices boosts Imperial Brands

Increased demand for smoking alternatives like oral nicotine and cigarette price hikes have helped grow profits for tobacco giant Imperial Brands.

The company behind brands including Golden Virginia, Winston and Rizla said £10 billion had been handed out to shareholders over the past four years.

It revealed that revenues totalled £32.2 billion for the year to the end of September, which was 0.7% lower than the year before.

But net of duties, revenues grew by 4.1% year on year, at constant currency rates.

The group’s adjusted operating profit grew by 4.6% to £4 billion in the latest year.

Imperial Brands reported another strong year for its so-called “next generation” products (NGPs), which include vapes, oral nicotine and heated tobacco.

NGPs are manufactured to separate nicotine from harmful tobacco smoke, and have ballooned in popularity in countries around the world as many people shift away from traditional cigarettes.

Revenues for the category surged by nearly 14% year on year, which includes growing demand for its oral nicotine product Zone in the US and Europe.

The pouches come in a variety of flavours and strengths and are designed to be placed between the gum and lip so nicotine can be absorbed through the mouth.

The company said it grew its share of the reusable vape market with its e-cigarette brand Blu, particularly in the UK, Spain and France.

Meanwhile, cigarette net revenues grew by 3.7% year on year, with average prices rising by 5.4% as the volume of sales declined.

Imperial Brands, which is listed on the London Stock Exchange, said £10 billion was returned to its shareholders between the 2021 and 2025 financial years.

It has commenced a £1.45 billion share buyback scheme for the 2026 financial year.

Lukas Paravicini, Imperial Brands’ chief executive, said: “Our performance in FY25 (2025 financial year) 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 is expecting its adjusted operating profit to grow by between 3% and 5% over the year ahead, driven by profit growth of its traditional tobacco business.