British American Tobacco will continue selling cigarettes in Russia, defying a gathering movement among global brands to halt operations there in response to the invasion of Ukraine.
The London-based cigarette manufacturer, whose brands include Lucky Strike and Rothmans, said it would “continue to operate” in Russia, one of its key growth markets for cigarettes and heated tobacco, according to the company’s latest annual report.
It will suspend capital investment and scale back marketing and business activities but stopped short of following its smaller British rival, Imperial Brands, by halting its operations altogether.
Some of the world’s largest consumer goods companies, including Nestlé, Unilever, Coca-Cola, Starbucks and McDonald’s, have put Russian units on hold, prompting a warning from a senior Kremlin official that their operations could be nationalised.
In a statement, British American Tobacco said its business in Ukraine had been suspended for safety reasons.
“We are deeply concerned about the conflict in Ukraine. The safety and wellbeing of our people there and across the region is our first priority. We have full local establishments of 1,000 people in Ukraine and 2,500 in Russia. Our thoughts are with them all at this incredibly difficult time.
“In Ukraine, we have suspended all business and manufacturing operations and are providing all the support and assistance we can to our colleagues, including relocation and temporary accommodation. Our businesses bordering Ukraine are providing assistance to the humanitarian relief effort.”
But the tobacco company said it would not follow other companies’ lead by suspending its Russian business voluntarily and would instead abide by sanctions.
“In Russia, we have a full establishment of our people right across the country, including substantial local manufacturing. Our business in Russia continues to operate. As a key principle we have a duty of care to all our employees at this extremely complicated and uncertain time for them and their families.
“We have suspended all planned capital investment into Russia and will focus on our portfolio of locally produced tobacco products – including our heated tobacco products. Furthermore, we are scaling our business activities appropriate to the current situation, including rationalising our marketing activities.”
