BAT attacks ban on vending machines

British American Tobacco has launched a scathing attack on the Government's plans to ban vending machines in pubs and displaying cigarettes in shops, as it toasted a jump in profits and revenues.

Last year, MPs supported the Health Bill, now going through the House of Lords, which would outlaw cigarette vending machines in England, Wales and Northern Ireland from October next year.

Michael Prideaux, a director at the maker of Dunhill, Kent and Pall Mall cigarettes, said: "I think it is a completely disproportionate reaction. Vending machines are mostly in places where entry is restricted by age."

In February, rival Imperial Tobacco's cigarette vending machine subsidiary, Sinclair Collis, launched legal action, and said it was seeking a "judicial review" of the relevant sections of the Health Act 2009.

Mr Prideaux also said the Health Bill's proposal to ban larger shops from openly displaying cigarettes from October next year and 2013 for smaller shops would boost the illegal market for tobacco.

For the 12 months to 31 December, BAT posted adjusted profit from operations up by 20 per cent to £4.46bn, although it was up by a more modest 10 per cent at constant exchange rates.

In its Asia-Pacific region, Mr Prideaux touted "strong performances" in Australia, Pakistan, Bangladesh, Taiwan and Vietnam, which drove a £224m jump in profit to £1.15bn in 2009. However, BAT's profits slipped in Eastern Europe, dragged down by lower volumes in Russia, Ukraine and Romania and the adverse impact of exchange rates on transactional costs.