British American Tobacco (BAT) is a global leader within the tobacco industry. Given its economies of scale in manufacturing; margins are expected to improve with supply chain efficiencies and overhead & indirect cost savings. Revenue growth is driven by a growing adult population, customer loyalty, product innovation, improved price-product mix and market leadership. Expansion into emerging markets has increased profits with East Europe, Far East, North Africa and Middle East being prioritised. Further risks are taxes, illicit tobacco trade and global economic downturn (cheaper brand switching).