Shares in British American Tobacco (LON:BATS) have been steady in London in today’s session, even as the company suffered a legal setback, as a Quebec court did not overturn a smoking class action lawsuit judgment made against the group’s Canadian unit. The news comes after the blue-chip group updated investors on its full-year performance last week, delivering a rise in revenue and profits, and announcing that its finance chief will retire this year.
As of 10:54 GMT, BAT’s share price had added 0.47 percent to 2,876.50p. The advance is in line with gains in the broader London market, with the benchmark FTSE 100 index currently standing 0.46 percent higher at 7,139.60 points.
Quebec court decision
The Court of Appeal of Quebec upheld on Friday a Superior Court decision of May 2015 in two Quebec Class Action lawsuits against BAT’s subsidiary Imperial Tobacco Canada and two other Canadian tobacco companies. The judgement follows an almost 20-year legal challenge, brought on behalf of smokers diagnosed with cancer and smokers addicted to nicotine.
“We are extremely disappointed that the Quebec Court of Appeal did not overturn the trial court’s judgment against our Canadian subsidiary,” a BAT spokesperson said in a statement to the London Stock Exchange, adding that the company was “still of the view that this decision is wrong – ignoring the reality that both adult consumers and government have known about the risk associated with smoking for decades”.
The group said that its Canadian subsidiary needed to review the decision and would decide on next steps over the coming weeks.
“Given the significance of the judgment, they have said that they fully intend to appeal the decision to the Supreme Court of Canada,” the spokesperson pointed out.
Analysts on FTSE 100 group
Sanford C. Bernstein, which rates BAT as a ‘neutral,’ set a price target of 3,210p on the shares today, while JPMorgan Chase & Co, which is ‘overweight’ on the stock, lowered its valuation on the shares from 4,200p to 4,000p yesterday. According to MarketBeat, the blue-chip group currently has a consensus ‘buy’ rating and an average price target of 3,868.67p.