British American Tobacco (BAT) plans to write off roughly £25 billion from the value of some of its U.S. cigarette brands.
This hit mainly hits the “combustible” segment—those good‑old sticks that sold a bunch of billions in the past.
It’s a financial “tune‑up” as the company looks ahead to a leaner cigarette lineup and bets on vaping.
Why the Price Tag Fell?
BAT cites “current macroeconomic headwinds” that are making U.S. smokers chillier about buying.
Long‑term strategy is shifting away from traditional cigarettes toward vapes, heated tobacco, and oral pouches.
The write‑off reflects a reassessment of how long those old brands can keep earning money—now pegged at roughly a 30‑year horizon.
CEO Tadeu Marroco’s Take
He’s confident that 2023 will keep the company “on target,” delivering steady sales and sticking to its financial guide.
“Vuse and Velo are pulling the brand’s weight, ramping up both volume and profit,” Marroco says.
While the U.S. cigarette market remains a tough spot, he notes early signs of a portfolio rebuild.
Market Analysts Reboot the Numbers
Darren Nathan from Hargreaves Lansdown points out that, although demand is weak, the company still managed some revenue growth—just on the low side of previous forecasts.
He highlights the fast rollout of new categories: vapes, heated tobacco, and oral pouches.
According to Nathan, the break‑even for these products is now expected in the current period—two years ahead of the original plan.
Management believes these “new‑age” products will make up about half of group revenues by 2035, although that’s still a distant horizon.
