London, April 22, 2026, 20:15 BST
- Imperial Brands bought back 190,000 shares on April 21 as part of its £1.45 billion repurchase programme.
- The stock fell the same day, extending pressure after last week’s warning on market share in key tobacco markets.
- Investors are looking to the May 12 half-year results for signs that second-half profit growth can carry the group’s full-year targets.
Imperial Brands PLC pressed ahead with its share buyback this week, purchasing 190,000 ordinary shares for cancellation on April 21, even as the tobacco group’s stock came under fresh pressure in London trading. The Bristol-based maker of Winston, Davidoff and Gauloises cigarettes paid an average 2,758.2776 pence a share, according to a regulatory filing.
The timing matters. Buybacks and dividends have been central to the Imperial Brands investment case, but investors are now testing whether cash returns can offset weaker market-share momentum in its largest cigarette markets and slower growth in smoking alternatives.
Imperial shares fell 2.29% on Tuesday to £27.34, underperforming a weaker FTSE 100, MarketWatch data showed. The move followed a sharper selloff last week, when the company said it expected a modest aggregate market-share reduction across its top five markets in the first half.
The company has kept its full-year outlook unchanged. Imperial said it still expects low-single-digit tobacco revenue growth, double-digit growth in next-generation products — vapes, heated tobacco and nicotine pouches — and 3% to 5% growth in group adjusted operating profit, a company profit measure that strips out selected items. It also guided for at least £2.2 billion in free cash flow, or cash left after operating needs and investment.
But the first half looks softer than the targets imply. Imperial said group adjusted operating profit should be only slightly higher year on year, with growth weighted to the second half. It also said foreign exchange translation, meaning the effect of currency moves when overseas earnings are converted into pounds, would be a 2.0% to 2.5% headwind to first-half earnings per share.
Hargreaves Lansdown’s Derren Nathan described the update as a “slow but steady start” and said full-year profit growth was still reachable if momentum improves later in the year. He added, however, that widening losses in next-generation products and slipping market share left investors “underwhelmed.” Hargreaves Lansdown
Imperial’s top five markets are the United States, Germany, the UK, Spain and Australia. Reuters reported last week that the company now wants to put profitability ahead of volume, a shift that could mean giving up some share in those markets while relying on pricing and cost control to protect earnings.
That is a delicate trade-off. Larger rivals British American Tobacco and Philip Morris International have spent heavily on premium brands and newer nicotine products, while Imperial has often competed as a lower-priced challenger. The sector is also trying to manage falling cigarette use while building products that regulators still watch closely.
AJ Bell investment director Russ Mould said Chief Executive Lukas Paravicini “knows this only too well” as he drives Imperial’s second five-year plan. Mould said investors were taking fright at the company’s market-share comments and at slower-than-expected growth in next-generation products, even as Imperial stuck to guidance. AJ Bell
The buyback gives Imperial a clear near-term support lever. The latest purchase will cut the share count to 779.1 million, excluding treasury shares, and forms part of the £1.45 billion repurchase programme announced in October. The company said last week it had completed £0.7 billion of that programme by March 31.
There is a risk the second half does not carry the weight now placed on it. Imperial has flagged uncertainty from the Middle East conflict, with no material business impact so far but possible pressure ahead, and its U.S. nicotine pouch business faces heavier promotion. The company also made a $200 million first-half payment to R.J. Reynolds after a Delaware Supreme Court decision, with $234 million more due in roughly equal instalments over three years.
Morningstar analyst Kristoffer Inton took a less worried view, saying the selloff pushed the stock near attractive territory and that the market may be pricing in “next to no growth.” He said tobacco remains far more important to Imperial’s valuation than new nicotine products, though he forecast five-year adjusted operating profit growth below the company’s longer-term 3% to 5% target. Morningstar
The next test comes on May 12, when Imperial is due to report results for the six months ended March 31. Investors will be watching for whether pricing, buybacks and cost savings are enough to quiet concerns over share loss — or whether the market starts asking harder questions about the 2030 plan.
