Imperial Tobacco rises after brands update

Imperial Tobacco is one of the day's biggest risers so far, following a positive response to an investor conference in Paris.

At the meeting on Tuesday, chief executive Alison Cooper and marketing director Peter Corijn discussed the company's plans for its brands and its growth prospects. The update has prompted a 34p rise in its share price to £26.73 and a buy note from Oriel Securities. Oriel analyst Chris Wickham said:

The presentation largely comprised a "deep dive" into the company's work on its brand portfolio. In particular, the company is doing a significant amount of work on re-organising its brands so that they are clearly structured across the group into clusters – referred to as "houses".

Imperial reiterated its focus on five global brands – Davidoff, JPS, West, Gauloises and USA Gold. In common with other global fast-moving consumer goods companies, greater use will be made of applying identical characteristics to brands – i.e. common platforms - even when names vary between countries.

As a result, the company is able to enjoy benefits from of simplification in such areas as procurement, manufacturing and marketing. In addition, they expect new initiatives to be rolled out faster.

Key Q&A items covered cash conversion – expected to rise – the ability to perform in dark markets and the USA. The company reiterated its ability to perform as a branded fast-moving consumer goods company in Australia, highlighting the benefits of strong customer engagement and noted the rise in market share of JPS.

In America, the company is committed to making the business work "as it stands." They highlighted the benefits of new innovations around the USA Gold brand where Glide Tech [slide open packaging] is working well.

While highlighting that this was a deep dive rather than a trading update, Imperial's presentation importantly relayed a strong message on its commitment to targeted investment, quality and growth.