BAT Appoints Tadeu Marroco as CEO to Lead Vaping Transformation
Today, on May 16, it was announced that British American Tobacco (BAT) has appointed Tadeu Marroco as CEO, succeeding Jack Bowles, who will step down on May 15.
<\/section>Marroco joined BAT in 1992 and was appointed to the BAT Board in 2019, serving as Group Finance Director. He has also been a member of the BAT Management Board since 2014, previously holding positions including Regional Director for Europe and North Africa and Group Transformation Director. A search for a new Group Finance Director will now begin.
Javed Iqbal, who has a broad financial career within the group and currently serves as Director of Digital and Information, will take on the role of interim Group Finance Director until a permanent successor is appointed.
“Since we established our Better Tomorrow strategy in 2019, we have seen significant momentum in our new categories business, establishing leadership in key markets and are on track to achieve profitability in new categories sooner than originally planned,” said BAT Chairman Luc Jobin. “During this time, we have also continued to deliver robust financial performance and returned over £20 billion [$25.03 billion] to shareholders. On behalf of the Board, I would like to thank Jack for his significant contributions as CEO during this important period.”
“To fully realize our transformation in a fast-changing environment, we must continue to evolve into a high-performing and agile consumer goods company. In considering succession, the Board recognized Marroco's excellent track record in developing teams that have delivered our transformation while maintaining a strong focus on execution and financial performance. We believe that under his leadership, we will further strengthen our relationships with key stakeholders and continue to build a better tomorrow, creating long-term sustainable value for our shareholders.”
“I am honored to be appointed as CEO of BAT. I want to thank Jack for his important role in shaping our Better Tomorrow strategy,” Marroco said. “At the core of this strategy, I firmly believe this is the right strategic path for BAT. In this dynamic environment, I remain committed to focusing on delivering results through excellent execution.”
“Leading BAT since 2019 has been my privilege,” Bowles said. “Over the past four years, we have embarked on transforming the business into a better tomorrow by focusing on the growth of new category consumer brands, which have generated nearly £3 billion in revenue. Now is the time for a leadership change to take the business to the next level.”
<\/section>“As I leave, I want to thank all my colleagues and the Board for their support and dedication to this strategy and the business transformation we have achieved. After 20 years with the company, I look forward to my next steps. I wish my successor Marroco and the excellent team at BAT all the best; he has served as our Group Finance Director for four years. Given the quality of BAT's talent pipeline, I am confident that BAT will continue to succeed.”
BAT is currently undergoing a transformation, with the sudden departure of Jack Bowles being replaced by former finance chief Tadeu Marroco, indicating that BAT is accelerating the pace and direction of its new strategy.
Bowles himself noted in today's RNS news release that now is the time for a leadership change to elevate the business to a new level.
The next phase involves launching the group's e-cigarette and heated tobacco product range.
This could be a lucrative market, particularly among the younger population, especially disposable e-cigarettes, which are cheaper and come in various flavors.
The long-term health impacts of e-cigarettes are shrouded in fruity-flavored smoke, presenting challenges that BAT and Marroco must address.
Foremost among these challenges are governments increasingly focused on health and the environment, meaning tobacco manufacturers need to continuously evolve to keep pace.
Earlier this year, there were rumors that UK Public Health Minister Neil O'Brien was planning to gather evidence to justify a ban on e-cigarettes like Elf Bars, which taste like candy and fruit.
Similarly, Australia has enacted a ban on the import of over-the-counter e-cigarettes, effectively wiping out potential business across the continent.
Due to ESG concerns, investors are increasingly shunning British American Tobacco and other “bad” stocks, which may partly explain their relatively low prices and high dividend yields.
AJ Bell's investment director Russ Mould stated: While these companies still generate strong cash flow, they must find new ways to attract investors and convince skeptics.
