British American Tobacco: Off the 1H26 Conference Call

Research evidence excerpt

British American Tobacco: Off the 1H26 Conference Call

h of Velo Max and

Vuse flavored pods, as well as behind combustible portfolio in a highly dynamic

market. Growth will moderate in H2 as positive inventory movements do not

repeat, and BAT laps a stronger comparator.

APMEA improvement: BAT expect further sequential performance recovery in

H2, supported by our commercial actions and investments in both combustibles

and new category, and a softer comparator in Australia.

Fit2Win savings: Incremental £100m savings (to £700m by 2028) will require

incremental one-off £100m investment (to £950m, of which £620m is cash; with

majority of cost this).

H2 performance: US performance lapping a stronger comparator; accelerating

AME performance; further sequential recovery in APMEA. H2 EBIT acceleration led

by further improvement in New Category contribution and savings from Fit2Win.

US performance: The company believes it is the best position to win in total

nicotine and continue to capture value in the world's largest nicotine value pool.

The company captured c90% share of growth in nicotine pouches and >100% in

vapour. The company will launch Vuse flavours starting in Q3 with targeted

distribution to c25k stores ensuring underage access prevention.

Nicotine pouches: In the US volume share reached 31% and value share almost

26%. The company will launch Velo Max (higher moisture offering in two new

strengths and four new flavours in Q3) and limited edition Velo Plus variants. Velo

is the No.1 global player with 39% volume share in H1 vs #2 player at 33%. This

reflects a 63% volume share (and 68.5% value share) in AME markets, vs #2 player

at 9%.

Heated tobacco: Industry volume growth slowed further in 1H26 to +7% (FY25