(Reuters) - British American Tobacco reported lower revenue for the first 9 months of the year on Wednesday, hurt by foreign exchange rates and the slow economic recovery in western Europe.
Sales volume for the global tobacco market is expected to shrink this year, due to economic weakness and a growing health consciousness that is leading people to quit smoking or switch to e-cigarettes.
The maker of Pall Mall and Dunhill cigarettes said revenue fell 9.6 percent in the nine months ended Sept 30. Excluding the currency impact, revenue rose 2.4 percent, as price increases on some brands offset competitive discounting and growth in the lower-priced segment in certain markets.
BAT said sales volume, which measures the number of cigarettes sold, fell 1 percent in the nine-month period. It had reported only a 0.4 percent dip for the first half of the year.
The company said volume was being hurt by large excise-driven price increases, as many countries have been raising taxes on cigarettes in order to discourage smoking.
The World Health Organization this month approved guidelines urging countries to increase tobacco taxes.
"The trading environment remains challenging due to continuing pressure on consumer disposable income worldwide and the slow economic recovery in western Europe," BAT said in a statement.
Still, it said it was "on track to deliver another year of good earnings growth at constant rates of exchange".
(Reporting by Martinne Geller in London; editing by Jason Neely)