British American Tobacco
Financial Assessment (2011-13)

Executive Summary

Prepared by the Devon Fund Managers, this reports provides recommendation to the potential investors with regard to investing actions in British American Tobacco PLC. In this report, it is concluded that BAT performs superior to its competitors in most parts of the financial performance, with a strong focus on innovation, on emerging opportunities of new markets and new products. On the basis of the analysis and interpretation of company’s financial ratios, Devon Fund Managers recommend that purchasing BAT shares, which is a well-positioned company in the global market with strong international brands, is a sensible decision. The current shareholders on the other hand, may prefer to preserve their ownership, because the company commits strong future performance based on new investments.

Contents

1. Introduction
2. Industry Overview
3. Ratio Analysis 3.1. Table of Ratios 3.2. Profitability 3.3. Efficiency 3.4. Liquidity 3.5. Financial Structure
4. Recommendation
5. Bibliography
6. Appendices

1. Introduction

This report aims at providing potential investors with an overall financial review of the company and giving recommendations for future actions. The financial assessment will be conducted through the analysis of some key ratios of BAT from 2011 to 2013, with comparison to the industry averages of 2013 and in the light of industrial overview.

2. Industry Overview

The global tobacco market is dominated between four largest multinational companies: British American Tobacco (BAT), Philip Morris International (PMI), Imperial Tobacco (IMT) and Japan Tobacco International (JTI). These four companies together account for around 45% of the global