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Imperial Brands PLC on Tuesday said it anticipates constant currency net revenue be between flat and up 1% in its current financial year, after evaluating the financial fallout of the planned exit from its Russian business and the suspension of operations in Ukraine.
On Wednesday last week, Imperial Brands said it had suspended all of its operations in Russia and Ukraine.
The Bristol-based tobacco company said it has started negotiations with an unnamed ‘local third party’ about a transfer of its Russian assets and operations.
‘We believe that, in the current circumstances, an orderly transfer of our business as a going concern would be in the best interests of our Russian colleagues,’ said Imperial, which has 1,000 employees in the country. Imperial Brands said that it will pay their salaries until any transfer is completed.
The company noted there will be ‘some ongoing costs’ related to the suspension of operations in Ukraine.
However, these will have a relatively small impact on its constant currency adjusted operating profit, it continued, due to the limited profit contribution of the two markets.
In the financial year that ended September 30 last year, Russia and Ukraine represented in total around 2% of net revenue and 0.5% of adjusted operating profit.
Shares were down 0.8% at 1,537.50 pence each on Tuesday morning in London.
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