Chairman’s AGM Statement – 2020 outlook
30 April 2020
Our main focus continues to be the health insurance and wellbeing of y our workers. To ensure safety that is best and also to minimise the possibility of virus transmission, we now have implemented a few preventative wellness measures for the workers around the globe, according to country-specific circumstances and government guidance. This will be specially necessary for our workers whoever jobs can’t be done at home. I wish to thank most of our workers and lovers with regards to their efforts that are tremendous help everyone’s wellbeing, plus the success of the company during this period.
Our ESG the ukrainian bride movie 2017 that is current priority giving an answer to the ‘whole of society’ approach needed by the that, even as we have actually outlined above. Having said that, I wish to highlight the more focus we now have delivered to ESG dilemmas generally speaking during 2019.
Sustainability Front and Centre
As explained during the present Capital Markets Day in March, sustainability is front and centre of every thing we do, so we now have actually a definite corporate function to create “A Better Tomorrow” for several our stakeholders:
- For the consumers through providing a higher range of enjoyable much less products that are risky
- For culture through decreasing the health that is overall ecological effects of y our company
- For the employees by developing a powerful and purposeful spot to work, and
- For the investors by regularly delivering against our commitments that are financial
At our Capital Markets Day, we announced committed brand new sustainability objectives:
- To possess 50 million consumers of non-combustible items by 2030
- To attain carbon neutrality by that exact same 12 months, and
- To carry ahead our existing 2030 targets that are environmental 2025
2019 Efficiency – A Stronger Operational Performance
2019 had been characterised by a solid performance that is operational we delivered on our three core priorities, to:
- Deliver value in combustibles
- Drive one step improvement in New groups
- Build an easier, faster organisation
We delivered against all our monetary objectives:
- Strong reported revenue growth up 5.7% at present prices and 5.6% on an adjusted constant price basis, driven by the exemplary performance from our combustibles profile, that was up 4.6% also for an adjusted rate basis that is constant
- This is running on our strategic combustibles brands, which, driven by continued strong volume and value share development and strong price/mix of 9%, expanded adjusted revenue 5.6% at constant prices, and
- Continued deleveraging associated with stability sheet, reducing Adjusted Net Debt**/Adjusted EBITDA*** by 0.5x to 3.5x
- A dividend of 210.4p per ordinary share, a 3.6% enhance, keeping our 65% pay-out policy
This supported further increased investment in brand brand New groups, focussing on building international brands to aid our differentiated approach that is multi-category vapour, tobacco-heating and modern oral services and products leading to:
- 32% constant money income development in New groups
- 11 million customers of non-combustible services and products, and
- New groups income of Ј1.2bn at constant prices, a lot more than doubling revenue from couple of years ago and supplying us by having a platform that is vital future development
Building A Far Better The Next Day
Jack Bowles marked their very first year that is full CEO, delivering strong results in 2019, and is accelerating our aspiration to change our company. The Board and we completely endorse the evolved “A Better Tomorrow” strategy he offered in the Capital Markets Day featuring its vision to simplify the Group, drive value from our combustibles profile, and better fulfill consumer that is evolving with new and revolutionary possibly paid down risk products.
The simplification were only available in 2019 using the very first stage of Project Quantum, a simple re-evaluation of how exactly we are organised, including:
- Redesigning management layers and duplication that is eliminating
- Whilst entrenching accountability, and
- Producing brand new abilities in the organization
Project Quantum will even launch funds that are valuable further reinvestment in future growth. We announced a phase that is further of project at our current Capital Markets Day as well as in total we make an effort to deliver cost cost savings of Ј1bn over 2020- 2022. This further stage will consist of:
- Operational efficiencies
- Route-to-market focus, and
- Supply chain efficiency
We remain dedicated to continuing the change of y our company in 2020.
I will be extremely pleased to welcome Jerry Fowden, whom brings extensive US encounter towards the Board. I want to thank Kieran Poynter our Independent that is senior Director whom appears down through the Board today. Dimitri Panayotopoulos can be Independent that is senior Director today’s conference.
And while you would expect provided my tenure as Chairman, the Board and Nominations Committee is likely to be focussed on succession preparation for my part, from where we expect you’ll retire at or before our 2021 AGM. Personally I think strongly that my successor will inherit a company this is certainly in exceptional form, that we have always been confident will deliver sustainable development for several years in the future.
Richard Burrows Chairman
2020 Outlook – Confirming High Single Figure EPS Growth and 65% Dividend Pay-out Policy
We now have consistently delivered on our high solitary figure constant money profits development target therefore we continue steadily to keep this guidance for 2020.
We’ve produced start that is strong the entire year driven by:
- Proceeded value and volume share development of 40bps and 20bps correspondingly
- Good volume development (with a few reap the benefits of a rise in trade and customer shares), and
- Strong price mix, with pricing in accordance with our plan