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London - Cigarette giant British American Tobacco saw
profits in the first nine months of the year slump 20 percent as it paid a heavy
cost for restructuring its British and Canadian operations, the firm said
Tuesday.
BAT,
which announced Monday it was selling its American arm to US rival R.J. Reynolds
Tobacco Holdings, said pre-tax profit to the end of September was £1.29 billion
(R15 billion).
This compares with a figure of £1.62 billion for the same period of last year.
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The
lower profits reflected "the exceptional costs of restructuring the businesses
in the UK and Canada, as well as a loss on disposal of a subsidiary," BAT said
in a statement.
The
results come a day after it was announced that R.J. Reynolds will buy BAT's US
operations in a stock-and-cash deal worth about $3.1 billion.
Under the agreement, R.J. Reynolds Tobacco, manufacturer of Camel cigarettes, will merge its business with BAT's Brown and Williamson Tobacco, which makes Lucky Strike cigarettes.cheap cigarettes
The
new publicly traded holding company is to be called Reynolds
American.
BAT
chairman Martin Broughton hailed the deal on Tuesday.
"The group as a whole remains very much on track and the exciting agreement with Reynolds is the best way to achieve our long-term strategic ambitions in the US, while improving both our earnings per share and our cash flow," he said. – AFPmarlboro cigarettes
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