Imperial Brands Reports Strong FY25 Results with Increased Shareholder Returns and NGP Growth

Imperial Brands FY25: growth in NGP, resilient tobacco pricing, and bigger shareholder returns

Imperial Brands has posted a steady set of full-year numbers for the 12 months to 30 September 2025, pairing resilient tobacco performance with another double-digit year in next generation products (NGP). The company is leaning into cash returns, upping the dividend and finishing a chunky buyback, while setting guidance that points to more of the same in FY26.

There is a change at the top too. New CEO Lukas Paravicini takes the reins, signalling an “evolutionary” strategy rather than a reset: keep the challenger mindset, sharpen consumer insights, and simplify operations. In other words, stick with what has worked since FY20, but do it faster and cleaner.

Key FY25 numbers investors need to know

Metric	FY25	FY24	Change
Reported revenue	£32,171m	£32,411m	-0.7%
Tobacco & NGP net revenue (adjusted basis)	£8,316m	£8,157m	+1.9% actual, +4.1% constant currency
Adjusted operating profit	£3,988m	£3,911m	+2.0% actual, +4.6% constant currency
Reported operating profit	£3,490m	£3,554m	-1.8%
Adjusted EPS	315.0p	297.0p	+6.1% actual, +9.1% constant currency
Reported EPS	251.1p	300.7p	-16.5%
Free cash flow	£2.7bn	Not disclosed here	–
Adjusted net debt	£8.4bn	£7.7bn	Leverage 2.0x (FY24: 1.8x)
Dividend per share	160.32p	153.42p	+4.5%

Tobacco engine: pricing power doing the heavy lifting

Cigarette volumes fell 1.7% to 186.9bn sticks, but price/mix rose 5.4%, more than offsetting the decline. That is the model: manage volume erosion with superior pricing and mix, and keep investing behind the brands and sales execution.

Market share was steady across the five priority markets year-on-year, with a five-year gain of 48 bps since FY20. The regional picture is mixed: Germany gained 45 bps, the US was broadly flat (-1 bp), the UK fell 85 bps and Spain fell 45 bps as Imperial prioritised value over share, and Australia edged up 20 bps after navigating regulatory change. On balance, that is a resilient outcome in mature categories.

NGP momentum: double-digit growth, losses narrowing

NGP net revenue rose 13.7% to £368m, with reported NGP revenue up 14.9%. Growth came from oral nicotine in the US and Europe, supported by new launches and wider distribution. Importantly, Imperial says it gained share across all smoke-free categories.

• Vapour: blu is performing well in Europe as the market shifts to reusable devices, with double-digit shares in the UK, Spain and France, and an expanded pod-based blu kit range.
• Modern oral: Zone widened its US footprint to around 100,000 stores, with positive consumer feedback on new European SKUs.
• Heated tobacco: the new Pulze 3.0 all-in-one device (used with iD and iSenzia sticks) received positive feedback and continues to gain share.

Adjusted NGP losses slimmed to £76m (FY24: £79m). That is only a modest improvement as the group continues to fund US rollout and product launches, but the five-year trend is encouraging: cumulative NGP net revenue up 83% since FY20, with adjusted operating losses reduced by 76%.

Distribution steady, FX a drag, and a few moving parts

Logista’s gross profit increased 2.9% as strong tobacco pricing offset weakness in long-distance transportation. At the group level, reported revenue dipped 0.7%, reflecting lower volumes in high-excise markets and adverse foreign exchange, partly offset by NGP and Distribution growth.

Adjusted operating profit grew 4.6% at constant currency, but reported operating profit fell 1.8%, with FX and costs tied to the 2030 strategy implementation weighing on the reported result. That also shows up in reported EPS, down 16.5% despite strong adjusted EPS growth.

Cash, debt and returns: the yield story stays front and centre

Free cash flow came in at £2.7bn, helped by strong combustibles cash generation and a one-off tax repayment. The balance sheet remains manageable: adjusted net debt of £8.4bn, equivalent to 2.0x EBITDA (FY24: 1.8x). Debt nudged up, but the company is still within a conservative corridor for a cash generative tobacco business.

Shareholder returns are the headline act:

• Dividend up 4.5% to 160.32p, in line with the progressive policy.
• FY25 £1.25bn buyback completed; FY26 £1.45bn buyback has commenced.
• £10bn returned from FY21 to FY25.

Strategy and execution: evolve, don’t overhaul

Imperial is sticking with two pillars: sustain value in combustibles and scale NGP. Behind the scenes, the group is simplifying operations – a new ERP platform went live at its first manufacturing site in October – and pushing a common brand-building framework across priority brands. The near-term focus is practical: supply chain efficiencies, savings in third-party indirect spend, manufacturing excellence, and optimising the factory footprint.

FY26 guidance: modest profit growth, NGP to grow faster

Management expects low-single-digit tobacco and double-digit NGP net revenue growth at constant currency in FY26. Group adjusted operating profit is guided to 3% to 5% growth, skewed to H2 due to pricing and investment phasing. After 2030 strategy costs, free cash flow is expected to be at least £2.2bn, and adjusted EPS growth at least high-single-digit, helped by the ongoing buyback. At current rates, FX translation is a 2.0% to 2.5% tailwind to net revenue, adjusted operating profit and EPS.

My take: solid core, NGP on track, watch the reported optics

This is a solid delivery from Imperial. Pricing power is doing what it should in combustibles, cash conversion remains strong, and management is keeping the capital return tap open. NGP is still loss-making but moving the right way, with tangible share progress and broader distribution in place. The new CEO’s “evolution, not revolution” stance feels sensible given the track record since FY20.

The flip side: reported revenue and reported EPS are down, FX continues to muddy the optics, and market share softness in the UK and Spain shows the trade-off when you favour value over volume. Net debt and leverage ticked up, and transportation profits within Distribution were weaker. None of these are thesis-breakers, but they are worth watching.

Why it matters for retail investors

• Income and buybacks: a 4.5% dividend increase plus a new £1.45bn buyback for FY26 points to sustained cash returns.
• Resilience: a 5.4% tobacco price/mix and moderated volume declines (-1.7%) underpin stability in the core business.
• Optionality in NGP: 13.7% net revenue growth to £368m shows momentum, with losses narrowing as scale builds.
• Visibility: FY26 guidance of 3% to 5% adjusted operating profit growth and at least high-single-digit adjusted EPS growth offers a clear near-term roadmap.

Jargon buster

• NGP (Next Generation Products): non-combustible products such as vapour, modern oral nicotine and heated tobacco.
• Constant currency: strips out exchange rate movements to show underlying performance.
• Adjusted measures: non-GAAP figures used by management to compare performance over time; reconciliations are provided in the company’s materials.
• Stick Equivalent (SE): a way to combine cigarettes, fine cut, cigars and snus volumes in one measure (NGP volumes excluded).

Bottom line

Imperial Brands has delivered another year of consistent execution: pricing-led tobacco growth, healthier NGP momentum, and meaningful cash returns to shareholders. Guidance suggests FY26 will echo that pattern, with NGP growing faster than the core and buybacks juicing EPS. If you own it for income and steady compounding, this update does what you would want.

For full details, see the company’s statement: Imperial Brands FY25 results.