Tear Sheet: British American Tobacco PLC

Its S&P Global Ratings-adjusted EBITDA reached £12.0 billion (we forecast £12.6 billion) and its free operating cash flow (FOCF) was £7.4 billion (we forecast £7.0 billion) highlighting the business's strong cash generation. Thanks to some debt reduction, its S&P Global Ratings-adjusted debt leverage was 2.9x (we forecast 2.8x) and funds from operations (FFO) to debt was about 24%, as we had forecast. Cash flow generation was affected by payments to the recurring Master Settlement Agreement (MSA) in the U.S., but also by adverse currency effects and the exit from Russia and Belarus. The combustibles business generated stable profits with the rest of the world mostly offsetting a profit decline in the U.S. New categories have gained scale and are now

...April 14, 2025 BAT's 2024 operating performance and cash flow are broadly in line with our base case. Its S&P Global Ratings-adjusted EBITDA reached ú12.0 billion (we forecast ú12.6 billion) and its free operating cash flow (FOCF) was ú7.4 billion (we forecast ú7.0 billion) highlighting the business's strong cash generation. Thanks to some debt reduction, its S&P Global Ratings-adjusted debt leverage was 2.9x (we forecast 2.8x) and funds from operations (FFO) to debt was about 24%, as we had forecast. Cash flow generation was affected by payments to the recurring Master Settlement Agreement (MSA) in the U.S., but also by adverse currency effects and the exit from Russia and Belarus. The combustibles business generated stable profits with the rest of the world mostly offsetting a profit decline in the U.S. New categories have gained scale and are now profit contributors despite some local regulatory challenges related to vaping in the U.S. New categories' profits should grow further but...

Full Report