British American Tobacco (WKN: 916018): Rising dividends despite challenges. What shareholders should pay attention to.

British American Tobacco (WKN: 916018): Rising dividends despite challenges. What shareholders should pay attention to.

According to a report by www.aktienwelt360.de, British American Tobacco faces difficult times. The publication of the preliminary annual figures for 2023 presented the company with another challenge. The announcement of a writedown of around £25bn on American cigarette brands raises questions about financial stability, particularly due to the high level of debt from the Reynolds takeover. However, British American Tobacco plans to generate around half of its sales from smoke-free alternatives by 2035, although the division has so far been plagued by losses. The coming year 2024 could be the first year in which profit contributions will be generated from the growth business with smoke-free alternatives.

These developments have potential impacts on the market, the consumer and the industry. The £25bn write-down could impact the company's balance sheet stability and limit financial flexibility. This could lead to a loss of confidence among investors and further negatively impact the share price. The planned transition to smoke-free alternatives presents opportunities for the company's long-term growth, but could impact short-term profitability and threaten the dividend yield.

Investors should therefore closely monitor developments at British American Tobacco as they could have a material impact on future dividends and long-term financial stability. Overall, British American Tobacco faces difficult times that require careful strategy to ensure long-term financial stability while investing in innovative, smoke-free alternatives.