EX-99.1 3 exhibit991.htm EX-99.1 Document
EXHIBIT 99.1
STRATEGIC REPORT - OVERVIEW
Chief Executive’s Review
Driving value from combustibles:
The second paragraph of this section on page 4 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
We have a targeted portfolio of brands across price tiers which have delivered a robust performance across our AME and APMEA regions, driven by resilient volumes.
1

STRATEGIC REPORT - STRATEGIC MANAGEMENT
Our Global Business
This section on pages 12 and 13 of the Group’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
Revenue by Region

U.S.£12,639m
AME£9,287m
APMEA£5,729m

Our Global Business
The first paragraph on page 13 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
Our business is divided into three complementary regions, with a balanced presence in both high-growth emerging markets and highly profitable developed markets.

The column on the right hand side of page 13 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
United State of America (U.S.)
Key Markets:
United States of America

Americas and Europe (AME)
Key Markets:
Argentina, Belgium, Brazil, Bulgaria, Canada, Chile, Colombia, Czech Republic, Denmark, France, Germany, Greece, Hungary, Italy, Mexico, Netherlands, Poland, Romania, Russia, Spain, Switzerland, Turkey, Ukraine, United Kingdom.
Russia will remain in the list of key markets until the transfer of the Russian business is complete.

Asia-Pacific, Middle East and Africa (APMEA)
Key Markets:
Algeria, Australia, Bangladesh, Egypt, Gulf Cooperation Council (including Saudi Arabia), Japan, Kazakhstan, Malaysia, Morocco, New Zealand, Nigeria, Pakistan, South Africa, South Korea, Taiwan, Vietnam.
2

STRATEGIC REPORT – A BETTER TOMORROWTM
Our Vapour Products
Proportion of Vapour revenue by region in 2022 (£m)
The chart on page 33 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
chart-980afcb6995049c7913.jpg
2022
£m
2021
£m
2020
£m
U.S.913561383
AME465328205
APMEA583823
Total1,436927611

Our Tobacco Heating Products (THPs)
Performance Summary
The fifth and seventh paragraph of this section on page 35 of BAT’s Annual Report and Form 20-F 2022 are updated to reflect the revised financial information as follows:
In AME, which has seen strong industry volume growth of 18% in 2022 (2021: 44%), our consumable volume increased 42.7%, having grown 207% in 2021. Accordingly, revenue increased 68.8%, or 64.7% at constant rates of exchange, having grown 158% (or 174% at constant rates of exchange) in 2021. The region now represents 50% of our global THP volume (or 37% excluding Russia) and 47% of our global THP revenue (or 39% excluding Russia).
In APMEA, where the most mature THP markets are, our consumable volume grew 12.3%, maintaining the momentum of 2021 when consumable volume increased by 40.6%. Revenue was up 1.1% (2021: +7.6%) or 7.0% (2021: +18.3%) at constant exchange, driven by higher volume and consumable pricing, partly offset by a partial absorption of excise increases.

Proportion of THP revenue by region in 2022 (£m)
The chart on page 35 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
chart-30670f24816944f08e4.jpg
2022
£m
2021
£m
2020
£m
U.S.—11
AME494292113
APMEA566560520
Total1,060853634



3

Our Modern Oral Products
Highlights
The third and fourth bullet of this section on page 36 of BAT’s Annual Report and Form 20-F 2022 are updated to reflect the revised financial information as follows:
–Volume share leadership in Modern Oral in AME at 68.8%.
–AME revenue up 29.9%, with volume up 30.5%, as Velo remains volume share leader in 15 Modern Oral markets in Europe.

Performance Summary
The eighth paragraph of this section on page 37 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
In AME, we are volume share leaders of the Modern Oral category in 15 markets where we are active. Revenue increased by 29.9% (2021: up 44.1%) or 31.6% (2021: up 45.5%) at constant rates of exchange. From a high base, volume share was marginally lower at 68.8%, down 60 bps (2021: up 370 bps).

Proportion of Modern Oral revenue by region in 2022 (£m)
The chart on page 37 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
chart-dd809b029f2b4e498f6.jpg
2022
£m
2021
£m
2020
£m
U.S.36210
AME341262182
APMEA21106
Total398274198

























4

Our Traditional Oral Products
Proportion of Traditional Oral revenue by region in 2022 (£m)
The chart on page 38 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
chart-d821381f7ee2408d9b4.jpg
2022
£m
2021
£m
2020
£m
U.S.1,1741,0771,126
AME354134
APMEA———
Total1,2091,1181,160

Our Combustible Products
Highlights
The first bullet of this section on page 39 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
–Group value share was flat, driven by the U.S., up 10 bps, and APMEA, up 10 bps, but offset by AME, down 30 bps.

Proportion of combustibles revenue by region in 2022 (£m)
The chart on page 40 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
chart-1b34f064eafb4a8f92b.jpg
2022
£m
2021
£m
2020
£m
U.S.10,47010,0159,926
AME7,5887,1797,531
APMEA4,9724,8355,295
Total23,03022,02922,752
5

STRATEGIC REPORT – FINANCIAL REVIEW
Financial Performance Summary
Profit from operations
Analysis of profit from operations, net finance costs and results from associates and joint ventures
The tables on page 100 of BAT’s Annual Report and Form 20-F 2022 are updated to reflect the revised financial information as follows:

Analysis of profit from operations, net finance costs and results from associates and joint ventures
2022

2021
Reported
£m
Adjusting
items
£m
Adjusted
£m
Impact of exchange
£m
Adjusted
at CC
£m

Reported
£m
Adjusting
items
£m
Adjusted
£m
Profit from operations

U.S.6,205 630 6,835 (740)6,095 

5,566 321 5,887 
AME2,926 422 3,348 (80)3,268 

2,902 157 3,059 
APMEA1,392 833 2,225 38 2,263 

1,766 438 2,204 
Total regions10,523 1,885 12,408 (782)11,626 

10,234 916 11,150 
Net finance (costs)/income(1,641)34 (1,607)140 (1,467)

(1,486)55 (1,431)
Associates and joint ventures442 92 534 (24)510 

415 12 427 
Profit before tax9,324 2,011 11,335 (666)10,669 

9,163 983 10,146 
Analysis of profit from operations, net finance costs and results from associates and joint ventures
2021
2020
Reported
£m
Adjusting
items
£m
Adjusted
£m
Impact of exchange
£m
Adjusted
at CC
£m
Reported
£m
Adjusting
items
£m
Adjusted
£m
Profit from operations
U.S.5,566 321 5,887 456 6,343 

4,975 809 5,784 
AME2,902 157 3,059 151 3,210 

3,076 183 3,259 
APMEA1,766 438 2,204 195 2,399 

1,911 411 2,322 
Total regions10,234 916 11,150 802 11,952 9,962 1,403 11,365 
Net finance (costs)/income(1,486)55 (1,431)(89)(1,520)(1,745)153 (1,592)
Associates and joint ventures415 12 427 29 456 455 (13)442 
Profit before tax9,163 983 10,146 742 10,888 8,672 1,543 10,215 
6

STRATEGIC REPORT - REGIONAL REVIEW
Regional Review
This section on pages 110 to 115 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:

AME – Americas and Europe
2022 revenue by category
The chart in the left column on page 112 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
chart-c1a411ef15f24a11b35.jpg
Revenue by category as % of total Region
20222021
2020
New Categories14.0%10.4%6.0%
Traditional oral0.4%0.5%0.4%
Combustibles 81.7%85.0%90.0%
Other3.9%4.1%3.6%

Key markets
Argentina, Belgium, Brazil, Bulgaria, Canada, Chile, Colombia, Czech Republic, Denmark, France, Germany, Greece, Hungary, Italy, Mexico, Netherlands, Poland, Romania, Russia, Spain, Switzerland, Turkey, Ukraine, the UK

Volume
2022
units
vs 2021
%
2021
units
vs 2020
%
2020
units
New Categories:
Vapour (10ml units / pods mn)261 +15.3 %226 +40.6 %162 
THP (sticks bn)12.0 +42.7 %8.4 +207 %2.7 
Modern Oral (pouches mn)3,083 +30.5 %2,363 +47.3 %1,604 
Traditional Oral (stick eq bn)1 -9.8 %1 +6.5 %1 
Cigarettes (bn sticks)280 -2.5 %286 -1.3 %290 
Other (bn sticks eq)*14 -10.5 %16 -8.5 %18 
Total Combustibles294 -2.9 %302 -1.7 %308 
* Other combustibles includes MYO/RYO.
7

Revenue
2022
£m
vs 2021
%
vs 2021
(adj at cc)
%
2021
£m
vs 2020
%
vs 2020
(adj at cc)
%
2020
£m
New Categories:
Vapour465 +41.4 %+38.4 %328 +60.5 %+63.5 %205 
THP494 +68.8 %+64.7 %292 +158 %+174 %113 
Modern Oral341 +29.9 %+31.6 %262 +44.1 %+45.5 %182 
Total New Categories1,300 +47.0 %+45.1 %882 +76.5 %+82.0 %500 
Traditional Oral35 -12.3 %-7.7 %41 +18.4 %+18.3 %34 
Combustibles7,588 +5.7 %+4.0 %7,179 -4.7 %+1.0 %7,531 
Other364 +7.0 %-1.3 %342 +13.4 %+21.9 %301 
Revenue9,287 +10.0 %+8.0 %8,444 +0.9 %+6.7 %8,366 

Profit from operations/operating margin
2022
£m
vs 2021
%
vs 2021
(adj at cc)
%
2021
£m
vs 2020
%
vs 2020
(adj at cc)
%
2020
£m
Profit from Operations2,926+0.8 %+6.8 %2,902-5.7 %-1.5 %3,076
Operating Margin (%)+31.5 %-290 bps-40 bps+34.4 %-240 bps-300 bps+36.8 %

-30 bps+47%
Cigarette value share changeRevenue growth in New Categories


Revenue and Profit from Operations
Reported revenue in 2022 was 10.0% higher than 2021 (2021: up 0.9%) driven by pricing in combustibles and the continued growth in New Categories revenue (2022: up 47%, 2021: up 77%). This was, in 2022, partly offset by lower combustible volume (down 2.9% in 2022 and 1.7% lower in 2021). Translational foreign exchange was a tailwind in 2022 of 2.0%, compared to a headwind of 5.8% in 2021.
Excluding the impact of currency, revenue grew 8.0% on an adjusted constant rates basis (2021: up 6.7%), driven by higher revenue in Romania, Brazil, Poland, Italy and the Czech Republic.
Reported profit from operations increased by 0.8% to £2,926 million, as performance was impacted by charges recognised in respect of the proposed transfer of the Group's operations in Russia and Belarus (which have been classified as held-for-sale at 31 December 2022, with an associated charge of £612 million in the period) and charges related to Quantum and the factory rationalisation programme. These charges were partly offset by the recognition (in the second half of 2022) of £460 million in Brazil in relation to the calculation of VAT on social contributions in prior periods (as the Group's litigation was successfully concluded in the year).
In 2021, reported profit from operations decreased 5.7% to £2,902 million, as the strong New Category revenue growth, in combination with tight control of overheads and Quantum cost savings, were more than offset by incremental investment in New Categories, the recognition of a £54 million charge related to goodwill in Peru and foreign exchange headwinds.
Excluding the impact of currency and adjusting items (in respect of Russia and Belarus, Brazil, Quantum and the factory rationalisation programme), adjusted profit from operations at constant rates was up 6.8% in 2022 (2021: down 1.5%) driven by the performance of New Categories, together with tight control of overheads and Quantum cost savings. The decline in 2021 was largely driven by the net investment in New Categories in that year.

New Categories
In 2022, revenue from Vapour was up 41.4% reflecting volume growth (up 15.3%) and pricing. In 2021, revenue from Vapour was 60.5% higher as volume grew 40.6%, driven by an increase in industry volume and higher consumables pricing.
However, the growth of the disposable segment in 2022 has impacted our value share of total Vapour across a number of markets. For example:
–In France, we maintained value share leadership despite a decline of 6.3 ppts to 38.8%;
–In Germany, we also maintained value share leadership despite a decline of 37.9 ppts to 21.4%; and
–In the UK, having been value share leader in previous periods, Vuse's value share declined 14.7 ppts to 14.8%, but stabilised in the final quarter post Vuse Go launch (May 2022) .
We rapidly rolled out our new modern disposable product, Vuse Go, over the second half through our broad distribution footprint and consumer reach in multiple markets including the UK, France, Spain, Germany, Greece and Ireland.
8

In 2022, Vuse won the Gold award at the Transform Awards Europe 2022 for "Best Use of Sustainable Packaging", as well as the SEAL business sustainability award.
In Canada, Vuse consolidated its leadership position with total value share up 8.9 ppts in 2022 (to 89.5%), having grown 34.3 ppts in 2021. This was driven by the launch of the Group's first connected Vapour device (Vuse ePod2+).
In 2022, THP volume grew by 42.7% (2021: up 207%), with revenue 68.8% higher at £494 million (2021: up 158% to £292 million). The region now represents 50% of our global THP volume (or 37% excluding Russia) and 47% of our global THP revenue (or 38% excluding Russia). glo continued to grow category volume share across all key European markets, with aggregate category volume share in key THP markets reaching 20.2%, up 380 bps on 2021. Excluding Russia, our aggregate share of the category reached 18.7% up 470 bps (2021: reached 14.0% up 910 bps). Driven by Hyper, glo performed well across the top European markets:
–Poland (up 14.4 ppts to 31.2%, 2021: up 13.8 ppts to 16.8%);
–Italy (up 170 bps to 14.5%, 2021: up 870    bps to 12.8%);
–Greece (up 470 bps to 13.2%,    2021: up 660 bps to 8.5%); and
–Hungary (up 740 bps to 14.4%, 2021: up 710 bps to 7.1%).
Hyper also continued to make good progress in the Czech Republic and across other smaller European launch markets. In the final quarter of 2022, we launched the new Hyper X2 device in our THP markets with encouraging early results.
In 2022, Modern Oral revenue grew 29.9% (2021: up 44.1%), led by 30.5% volume growth (2021: 47.3% increase).
We remain the clear market leaders (by volume share) in 15 Modern Oral markets. From a high base, volume share was marginally lower at 68.8%, down 60 bps. As the Modern Oral category continues to grow and become more established in Europe, we continue to see strong growth in average daily consumption, including in Sweden which reached 11 pouches (per consumer) in November 2022***.
Specifically in respect of the key markets:
–In Sweden, where Modern Oral has grown to represent 19.0% of the total oral category, our volume share of the Modern Oral category was 58.1%, a decrease of 170 bps on 2021 (2021: up 590 bps to 59.7%), impacted by heavy competitor discounting, with volume share stabilising in the final quarter;
–In Norway, where Modern Oral now represents 33.5% of the total oral category, we maintained our leadership position with volume share of the Modern Oral reaching 64.1%, up 20 bps vs 2021 (2021: up 180 bps    to 63.9%);
–In Denmark (with volume share marginally lower than 2021, down 40 bps at 92.2%, 2021: down 130 bps on 2020) and in Switzerland (volume share up 160 bps to 93.2%, 2021: fell 340 bps to 91.5%), we maintained our volume share leadership position in the Modern Oral category from a high base; and
–In the UK, we gained market leadership with volume share reaching 51.6%, an increase of 2,220 bps from 29.4% in 2021 (2021: increase of 1580 bps from 13.6% in 2020).

Combustibles
In 2022, revenue was 5.7% higher, compared to a decline of 4.7% in 2021. Good price/mix in both years (of 6.9% in 2022 and 2.7% in 2021) was offset by the impact of lower combustible volume, down 2.9% in 2022 and 1.7% in 2021. Excluding the impact of translational foreign exchange, at constant rates of exchange, revenue increased 4.0% (2021: 1.0%).
The decrease in combustible volume in 2022 was driven by lower volume in Turkey, Germany, Denmark and France, partly offset by an improvement in Brazil due to lower illicit trade. The decrease in combustible volume in 2021 was driven by lower volume in Ukraine and Russia, in part due to industry contraction in those markets.
Cigarette value share was down 30 bps in 2022 (driven by lower value share in Canada, Russia, Brazil, Romania, Germany and Poland, partially offset by higher value share in Spain, Colombia and the UK), while 2021 was down 30 bps. Cigarette volume share declined 30 bps (2021: down 30 bps) with volume share up in Colombia, Spain, the UK, Denmark, France and the Ukraine, which was more than offset by reductions in Brazil, Russia, Poland, Romania, Canada, Germany, Hungary, Mexico, Italy, the Netherlands, Chile, Switzerland, Greece and Belgium.


Note:
*** Source: Kantar New Category Tracker.
9

APMEA – Asia-Pacific, Middle East and Africa
2022 revenue by category
The chart in the left column on page 114 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
chart-a9d7b1ac6b4143f2a2c.jpg
Revenue by category as % of total Region
20222021
2020
New Categories11.3%11.0%9.2%
Traditional oral———
Combustibles 86.8%87.1%89.2%
Other1.9%1.9%1.6%

Key markets
Algeria, Australia, Bangladesh, Egypt, Gulf Cooperation Council (inc the Kingdom of Saudi Arabia (Saudi Arabia)), Japan, Kazakhstan, Malaysia, Morocco, New Zealand, Nigeria, Pakistan, South Africa, South Korea, Taiwan, Vietnam

Volume
2022
units
vs 2021
%
2021
units
vs 2020
%
2020
units
New Categories:
Vapour (10ml units / pods mn)31 +73.2 %18 +108.8 %8 
THP (sticks bn)12.0 +12.3 %10.7 +40.6 %8.0 
Modern Oral (pouches mn)626 +89.0 %331 +97 %168 
Traditional Oral (stick eq bn)— — — — — 
Cigarettes (bn sticks)266 -5.2 %281 +2.5 %274 
Other (bn sticks eq)*2 -6.8 %2 -15.3 %2 
Total Combustibles268 -5.2 %283 +2.4 %277 
* Other combustibles includes MYO/RYO.
Revenue
2022
£m
vs 2021
%
vs 2021
(adj at cc)
%
2021
£m
vs 2020
%
vs 2020
(adj at cc)
%
2020
£m
New Categories:
Vapour58 +55.1 %+53.0 %38 +62.7 %+60.8 %23 
THP566 +1.1 %+7.0 %560 +7.6 %+18.3 %520 
Modern Oral21 +114.4 %+111.9 %10 +84 %+101 %6 
Total New Categories645 +6.3 %+11.5 %608 +10.7 %+20.9 %549 
Traditional Oral— — — — — — — 
Combustibles4,972 +2.8 %+3.8 %4,835 -8.7 %+0.6 %5,295 
Other112 +2.8 %-4.3 %106 +15.4 %+23.3 %93 
Revenue5,729 +3.2 %+4.4 %5,549 -6.5 %+2.8 %5,937 

10

Profit from operations/operating margin
2022
£m
vs 2021
%
vs 2021
(adj at cc)
%
2021
£m
vs 2020
%
vs 2020
(adj at cc)
%
2020
£m
Profit from Operations1,392-21.2 %+2.7 %1,766-7.6 %+3.3 %1,911
Operating Margin (%)+24.3 %-750 bps-70 bps+31.8 %-40 bps+20 bps+32.2 %

+10 bps+6.3%
Cigarette value share changeRevenue growth in New Categories

Revenue and Profit from Operations
Reported revenue increased 3.2% to £5,729 million (2021: declined 6.5% to £5,549 million).
The performance in 2022 was driven by the continued growth in New Categories and pricing in combustibles, which more than offset lower combustibles volume (down 5.2%). Volume benefited from the continuing emerging market recovery from COVID-19, partly offset by the sale of the Group's Iranian business midway through 2021.
Revenue in 2021 (when compared to 2020) was impacted by the structural excise changes in Australia and New Zealand, and competitive pricing dynamics in Australia (in combination, an estimated headwind of £260 million), and negative geographic mix due to volume share growth and recovery from COVID-19 in emerging markets, leading to a growth in combustible volume of 2.4% (largely due to Bangladesh, Vietnam and Pakistan). Revenue in 2021 was also negatively impacted by the sale of the Group's Iranian business partway through the year.
Excluding the impact of translational foreign exchange, in 2022 revenue was up 4.4% against 2021, itself an increase of 2.8% compared to 2020, on an adjusted constant rate basis.
Reported profit from operations declined 21.2% to £1,392 million, while 2021 was down 7.6% to £1,766 million. 2022 was impacted by increased one-off charges related to the allegations of historical breaches of sanctions (£450 million), the exit from Egypt (£118 million) and a charge of £79 million (related to the conclusion of the investigation into alleged violations of the Nigerian Competition and Consumer Protection Act and National Tobacco Control Act). In 2021, the Group recognised a charge of £358 million in relation to the disposal of the Group's Iranian business (mainly in respect of foreign exchange previously charged to other comprehensive income).
Excluding adjusting items and the impact of translational foreign exchange, adjusted profit from operations at constant rates of exchange increased 2.7% in 2022 (2021: up 3.3%), driven by the top line growth (despite negative mix due to volume growth in lower margin markets) and efficiencies delivered through Quantum. Furthermore, the sale of the Iranian business, due to its timing in 2021, acted as a drag on adjusted profit from operations in both years.

New Categories
Total revenue from New Categories increased 6.3% to £645 million (2021: increased 10.7% to £608 million).
In 2022, this was driven by a 12.3% increase in THP consumable volume to 12 billion sticks, compared to an increase of 40.6% to 11 billion sticks in 2021. This was driven by the success of glo Hyper including the new variant Hyper X2. glo Hyper is powered by Advanced Induction Heating and provides a step change in consumer satisfaction with 30% more tobacco and a boost function.
THP revenue increased 1.1% (2021: increase of 7.6%), or 7.0% (2021: up 18.3%) excluding the impact of translational foreign exchange. The growth in both years was driven by increased Hyper volume, while the growth in 2021 was also due to a £50 million charge to revenue in 2020, that did not repeat in 2021, in respect of the withdrawal of glo Sens.
In Japan, the largest THP market in the world, glo performed well, maintaining the momentum of 2021 with volume share of total tobacco (being FMC and THP combined) increasing to 7.4% in 2022, up 60 bps, having grown 140 bps in 2021. However, in 2022, glo's volume share of the THP category declined 120 bps to 20.1% from 21.2% in 2021 (compared to 19.4% in 2020) as glo volume grew at a slower rate than the category due to competitive competitor pricing.
In Modern Oral, revenue grew 114% (2021: 84%) (or 112% at constant rates of exchange    (2021: 101%)) with volume up 89% to 626 million pouches    (2021: up 97% to 331 million pouches).
We believe that Modern Oral is an exciting longer-term opportunity to unlock reduced risk products*† in Emerging Markets. We are particularly proud of Velo’s performance in Pakistan, now our third largest Modern Oral market by volume, where we have rapidly achieved national coverage. Enabled by powerful, consumer-centric digital activations, Velo has reached a monthly volume in the country of over 40 million pouches.
Furthermore, in:
–Kenya, after the category was reinstated as regulated under the Tobacco Control Act, we reintroduced Velo to a limited retail universe with positive early momentum, as we focus on driving guided trial; and
–South Africa, we have expanded our pilot in Johannesburg, with guided trial and expansion into key accounts, delivering encouraging early results.


11


Combustibles
Revenue from combustibles increased by 2.8% to £4,972 million (2021: down 8.7% to £4,835 million), or by 3.8% (2021: up 0.6%) at constant rates of exchange.
In 2022, this was driven by improved pricing and a partial recovery of Global Travel Retail following the COVID-19 restrictions of 2020 and 2021. These more than offset a decrease in combustible volume of 5.2% and the negative impact of the sale of the Group's Iranian business partway through 2021.
The sale of the Iranian business also impacted 2021 (versus 2020) which contributed to the decline in combustibles revenue despite an increase in combustible volume (up 2.4%) as emerging markets recovered from COVID-19. However, this led to a negative geographic mix which, combined with structural excise changes in Australia and New Zealand and competitive pricing dynamics in Australia (totalling approximately £260 million), drove revenue down.
In 2022, value share increased 10 bps (2021: down 30 bps), with volume share flat (2021: 20 bps higher), as volume share gains (including in Japan, Pakistan and Saudi Arabia) were offset by losses in Bangladesh and South Korea. In 2021, value share was down 30 bps, as growth in Japan, Bangladesh, Taiwan, Pakistan and Malaysia was offset by a lower share in Indonesia, Saudi Arabia, Australia, South Africa, New Zealand and South Korea.


Notes:
* Based on the weight of evidence and assuming a complete switch from cigarette smoking. These products are not risk free and are addictive.
† Our Vapour product Vuse (including Alto, Solo, Ciro and Vibe), and certain products including Velo, Grizzly, Kodiak, and Camel Snus, which are sold in the U.S., are subject to FDA regulation and no reduced-risk claims will be made as to these products without agency clearance.
12

OTHER INFORMATION
Information on the Group
Overview
The second and third paragraph on page 320 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
The Group, excluding the Group’s associated undertakings, is organised into three regions:
–the United States of America (Reynolds American Inc.);
–Americas and Europe (AME); and
–Asia-Pacific, the Middle East and Africa (APMEA).
13

OTHER INFORMATION
Non-GAAP Measures
Revenue by Product Category or Geographic Segment – Including Revenue From New Categories, at constant rates of exchange
This section on pages 325 to 327 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:
Definition – revenue by product category, and at the prior year’s prevailing exchange rate, derived from the principal product categories of Combustibles, New Categories (being comprised of revenue from Vapour, THP and Modern Oral), and Traditional Oral, including by the geographic segments of the United States, Americas and Europe, and Asia-Pacific, Middle East and Africa.
To supplement BAT’s revenue presented in accordance with IFRS, the Group’s Management Board, as the chief operating decision-maker, reviews revenue growth from the principal product categories of combustibles, New Categories and Traditional Oral, including from the geographic segments of the United States, Americas and Europe, and Asia-Pacific, Middle East and Africa, to evaluate the underlying business performance of the Group reflecting the focus of the Group’s investment activity. The Group’s Management Board assesses revenue by product category, including by geographic segment, at constant rates of exchange, translated to the Group’s reporting currency at the prior period’s prevailing exchange rate, derived from the Group’s combustible portfolio (including but not limited to Kent, Dunhill, Lucky Strike, Pall Mall, Rothmans, Camel (U.S.), Newport (U.S.), Natural American Spirit (U.S.)), the Group’s New Category portfolio (being Vapour, THP and Modern Oral) and the Group’s Traditional Oral portfolio and the Group’s operations in the United States, Americas and Europe, and Asia-Pacific, Middle East and Africa.
The Group’s Management Board also believes that the revenue performance by product category, including by geographic segment provides information that enables investors to better compare the Group’s business performance across periods and by reference to the Group’s investment activity. Revenue by product category, including by geographic segment have limitations as analytical tools. The most directly comparable IFRS measure to revenue by product category, including by geographic segment, is revenue. Revenue by product category, including by geographic segment, are not presentations made in accordance with IFRS, are not measures of financial condition or liquidity and should not be considered as alternatives to revenue as determined in accordance with IFRS. Revenue by product category, including by geographic segment, are not necessarily comparable to similarly titled measures used by other companies. As a result, you should not consider these performance measures in isolation from, or as a substitute analysis for, BAT’s results as determined in accordance with IFRS.
Reconciliation of revenue by product category to revenue by product category at constant rates of exchange – 2022 - 2021
2022
2021
Reported
£m
vs 2021
%
Impact of exchange
£m
Reported at cc
£m
Reported at cc vs 2021
%
Reported
£m
New Categories:
Vapour1,436 +54.9 %(103)1,333 +43.8 %927 
THP1,060 +24.3 %21 1,081 +26.7 %853 
Modern Oral398 +45.3 %1 399 +45.6 %274 
Total New Categories2,894 +40.9 %(81)2,813 +37.0 %2,054 
Traditional Oral1,209 +8.2 %(117)1,092 -2.3 %1,118 
Combustibles23,030 +4.5 %(1,142)21,888 -0.6 %22,029 
Other522 +7.6 %(42)480 -0.8 %483 
Revenue27,655 +7.7 %(1,382)26,273 +2.3 %25,684 

Reconciliation of revenue by product category to revenue by product category at constant rates of exchange – 2021 - 2020
2021
2020
Reported
£m
vs 2020
%
Impact of exchange
£m
Reported at cc
£m
Reported at cc vs 2020
%
Reported
£m
New Categories:
Vapour927 +51.8 %46 973 +59.3 %611 
THP853 +34.4 %74 927 +46.1 %634 
Modern Oral274 +38.8 %4 278 +40.6 %198 
Total New Categories2,054 +42.4 %124 2,178 +50.9 %1,443 
Traditional Oral1,118 -3.6 %77 1,195 +3.0 %1,160 
Combustibles22,029 -3.2 %1,640 23,669 +4.0 %22,752 
Other483 +14.7 %36 519 +23.1 %421 
Revenue25,684 -0.4 %1,877 27,561 +6.9 %25,776 
Note:
cc: constant currency – measures are calculated based on a re-translation, at the prior year’s exchange rates, of the current year’s results of the Group and, where applicable, its geographical segments or product categories.

14

Reconciliation of revenue by product category to revenue by product category at constant rates of exchange
2022
2021
U.S.
Reported
£m
vs 2021
%
Impact of exchange
£m
Reported at cc
£m
Reported at cc vs 2021
%
Reported
£m
New Categories:
Vapour913 +62.9 %(92)821 +46.4 %561 
THP— -69.1 %— — -72.3 %1 
Modern Oral36 n/m(3)33 n/m2 
Total New Categories949 +68.7 %(95)854 +51.6 %564 
Traditional Oral1,174 +8.9 %(119)1,055 -2.1 %1,077 
Combustibles10,470 +4.5 %(1,061)9,409 -6.1 %10,015 
Other46 +27.9 %(6)40 +14.9 %35 
Revenue12,639 +8.1 %(1,281)11,358 -2.8 %11,691 
2021
2020
U.S.
Reported
£m
vs 2020
%
Impact of exchange
£m
Reported at cc
£m
Reported at cc vs 2020
%
Reported
£m
New Categories:
Vapour561 +46.4 %40 601 +56.9 %383 
THP1 -21.8 %— 1 -16.2 %1 
Modern Oral2 -81.5 %— 2 -80.1 %10 
Total New Categories564 +43.0 %40 604 +53.3 %394 
Traditional Oral1,077 -4.3 %78 1,155 +2.6 %1,126 
Combustibles10,015 +0.9 %719 10,734 +8.1 %9,926 
Other35 +26.9 %2 37 +36.0 %27 
Revenue11,691 +1.9 %839 12,530 +9.2 %11,473 

2022
2021
AME
Reported
£m
vs 2021
%
Impact of exchange
£m
Reported at cc
£m
Reported at cc vs 2021
%
Reported
£m
New Categories:
Vapour465 +41.4 %(10)455 +38.4 %328 
THP494 +68.8 %(12)482 +64.7 %292 
Modern Oral341 +29.9 %4 345 +31.6 %262 
Total New Categories1,300 +47.0 %(18)1,282 +45.1 %882 
Traditional Oral35 -12.3 %2 37 -7.7 %41 
Combustibles7,588 +5.7 %(125)7,463 +4.0 %7,179 
Other364 +7.0 %(27)337 -1.3 %342 
Revenue9,287 +10.0 %(168)9,119 +8.0 %8,444 
2021
2020
AME
Reported
£m
vs 2020
%
Impact of exchange
£m
Reported at cc
£m
Reported at cc vs 2020
%
Reported
£m
New Categories:
Vapour328 +60.5 %7 335 +63.5 %205 
THP292 +157.5 %19 311 +174 %113 
Modern Oral262 +44.1 %3 265 +45.5 %182 
Total New Categories882 +76.5 %29 911 +82.0 %500 
Traditional Oral41 +18.4 %(1)40 +18.3 %34 
Combustibles7,179 -4.7 %429 7,608 +1.0 %7,531 
Other342 +13.4 %24 366 +21.9 %301 
Revenue8,444 +0.9 %481 8,925 +6.7 %8,366 
Note:
cc: constant currency – measures are calculated based on a re-translation of the current year’s results of the Group at the prior year’s exchange rates and, where applicable, its geographical segments or product categories.

15

Reconciliation of revenue by product category to revenue by product category at constant rates of exchange
2022
2021
APMEA
Reported
£m
vs 2021
%
Impact of exchange
£m
Reported at cc
£m
Reported at cc vs 2021
%
Reported
£m
New Categories:
Vapour58 +55.1 %(1)57 +53.0 %38 
THP566 +1.1 %33 599 +7.0 %560 
Modern Oral21 +114.4 %— 21 +111.9 %10 
Total New Categories645 +6.3 %32 677 +11.5 %608 
Traditional Oral— — %— — — %— 
Combustibles4,972 +2.8 %44 5,016 +3.8 %4,835 
Other112 +2.8 %(9)103 -4.3 %106 
Revenue5,729 +3.2 %67 5,796 +4.4 %5,549 
2021
2020
APMEA
Reported
£m
vs 2020
%
Impact of exchange
£m
Reported at cc
£m
Reported at cc vs 2020
%
Reported
£m
New Categories:
Vapour38 +62.7 %(1)37 +60.8 %23 
THP560 +7.6 %55 615 +18.3 %520 
Modern Oral10 +83.7 %1 11 +101 %6 
Total New Categories608 +10.7 %55 663 +20.9 %549 
Traditional Oral— — — — — — 
Combustibles4,835 -8.7 %492 5,327 +0.6 %5,295 
Other106 +15.4 %10 116 +23.3 %93 
Revenue5,549 -6.5 %557 6,106 +2.8 %5,937 
Note:
cc: constant currency – measures are calculated based on a re-translation of the current year’s results of the Group at the prior year’s exchange rates and, where applicable, its geographical segments or product categories.
16

OTHER INFORMATION
Employees
The table on page 337 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:

Region (number of employees worldwide)
As of 31 December
202220212020
U.S.4,1524,4054,921
AME33,17533,78235,004
APMEA
13,07013,86315,404
Total employees50,39752,05055,329
Note:
1.    Included within the employee numbers for AME are certain employees in different locations in respect of central functions. Some of the costs of these employees are allocated or charged to the various regions and markets in the Group.
17

OTHER INFORMATION
Property, Plant and Equipment
BAT-owned manufacturing facilities1
The table on page 369 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information as follows:

United States
AME
APMEA
Total
Fully integrated manufacturing1172341
Other processing sites (incl leaf threshing and OTP)19616
Sites manufacturing other products (including Snus, Modern Oral and Liquids)34—7
Research and development facilities3339
Total8333273
Note:
1.    As of 31 December 2022.
18

OTHER INFORMATION
Glossary
This section on page 394 of BAT’s Annual Report and Form 20-F 2022 is updated to reflect the revised financial information and the following items have been added:
AME – Americas (excluding U.S.) and Europe
APMEA – Asia-Pacific, Middle East and Africa
















19