(Corrects to show tobacco and next-generation products revenue for full year, not third quarter, paragraph 3)
* Expects low single digit revenue and EPS growth in 2020
* Premium cigar business sale at advanced stage
* Appoints Thérèse Esperdy as chairman
* Shares up 1%
By Siddharth Cavale
LONDON, Nov 5 (Reuters) - Imperial Brands on Tuesday issued a "cautious" forecast for the year and named a new chairman as the tobacco producer grapples with challenges in e-cigarette products and vaping.
The British company said it plans to launch new e-cigarette products and refresh its main e-cigarette brand blu this year with its performance in e-cigarettes and tobacco heating products expected to be more heavily weighted in the second half.
The maker of Winston and Gauloises cigarettes reported full-year revenue from tobacco and next-generation products - e-cigarettes and vapour-based devices - of 7.99 billion pounds ($10.29 billion), up 3.9% on a constant-currency basis.
That was just above the 7.93 billion expected by analysts after the Imperial in September lowered its 2018 revenue growth forecast to 2% from as much as 4%. Imperial shares were up about 1% in mid-morning trade.
"2019 has been a challenging year with results below our expectations due to tough trading in Next Generation Products," outgoing CEO Alison Cooper said in a statement.
A spate of vaping-related deaths and illnesses and high rates of teen use of e-cigarettes has triggered a ban on the sale of flavouring e-cigarettes in the United States where Imperial makes 30% of its profits.
The company said the U.S. regulatory environment continued to be "challenging" and "volatile," prompting it to issue a forecast for low single digit revenue and earnings per share growth in 2020, excluding any impact from ongoing divestments.
"Vaping and other ‘next generation’ products were meant to be the future for Imperial Brands but growth has been slower than expected. That’s forced investors to question the future earnings potential of the business," said Russ Mould, investment director at AJ Bell.
Imperial shares are down almost 27% this year hurt by a dimmed outlook for the vaping and e-cigarette market and factors including the company dropping its dividend growth target, cutting its profit forecast and announcing Cooper's planned departure as CEO.
Cooper, on a media call on Tuesday said that the company's blu e-cigarette brand was not driving loyalty with smokers despite Imperial's marketing efforts.
"We invested behind trials significantly ..but people are not sticking with the brand," said Cooper, who will step aside once a successor is found.
Imperial on Tuesday announced Thérèse Esperdy, senior independent director of the board, will succeed Mark Williamson as chairman from January 1, 2020.
Esperdy has held numerous roles at U.S. bank JPMorgan and also did a stint at Lehman Brothers. She joined the Imperial board in 2016, the company said.
Williamson, announced that he would step down in February, once a successor was found, citing new British guidelines on the length of board chair tenures.
The company also said that talks to sell its premium cigar business, which it put up for sale in April, were at an "advanced" stage.
A media report here on Monday, citing multiple sources close to the negotiations, said Imperial was close to selling the business to Chinese firm Huabao.
$1 = 0.7763 pounds Reporting by Siddharth Cavale in London; editing by Jason Neely