Imperial Tobacco is a Solid Investment

Imperial Tobacco Imperial Tobacco, the maker of Gauloises and West, has prevented volumes from falling by increasing prices and boasting a strong balance sheet. Imperial Tobacco manages to contol lowering sales of cigarettes by increasing prices and keeping tight control of costs. In 2013 the volume of cigarettes sold by the Imperial Tobacco dropped by 4bn. However, the company managed to maintain revenue fixed and to some extent increase profit earning It was not easy. Investors are interested in buying the income and the shares for the dividend of the tobacco company. They were encouraged with words by Alison Cooper, chief executive of a FTSE 100-listed company who said: “A reasonable working assumption for 2014 is modest growth in earnings per share at constant currency, with another strong dividend increase of at least 10pc.” Imperial Tobacco, that produces such famous brand as Davidoff, showed their interest in production of e-cigarettes, the electornic devices having shape of regular cigarette that uses a batery to produce vapour to inhale. These days e-cigarette market is growing quite quickly. In an attempt to go in pace with time Imperial Tobacco decided to go into production of e-cigarettes and this year it is going to launch its own products of this type. As to share prices, at current levels the shares of Imperial Tobacco look cheap. Generally, the tobacco industry will continue to increase prices to fight falling volumes. The balance sheet is strong and Imperial Tobacco company remains a perfect place to park cash.

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