Harare – BAT has emerged from years of stuttering after reporting a topline growth of 19% in the first half period of the year.
In a statement accompanying the financial results for the 6 months period to June, BAT reported that revenue went up by 19% to $19.9 million from $16.7 million in the same period last year.
Before the current year surge, BAT recorded a stable topline performance in the first half of 2017 and before that, a topline negative growth in 2016 which was induced by faltering aggregate demand.
Overall, performance for the half year was solid and much more improved from the prior year, largely a carryover from a strong 2017 second half performance.
Increased sales volumes and efficiencies in production were cited as the core drivers of outperformance.
In a statement accompanying the BTAZ financial results, the directors said total sales volume grew by 21 percent driven by growth in all segments.
“The Premium Brands recorded a growth of 37 percent, the Value for Money Brands attained a 16 percent growth and the Low Value for Money Brands achieved a growth of 285 percent,” he said.
Total revenue increased by 19 percent to $19.9 million from $16.7 during the same period last year.
During the period under review selling and marketing cost amounted to $2.6 million, which is a 19 percent increase from $2.1 million.
Manatsa attributed the increase in marketing costs to the upsurge of marketing activities during the first half of the year to support the company’s agenda of delivering value to consumers.
He said administrative expenses reduced to $2.3 million compared to $3.6 million last year which is a 37 percent reduction, primarily as a result of savings initiatives and once off retrenchment costs incurred in the first half of 2017.
The cigarette manufacturer and distributor said operating profit increased by 58 percent compared to $6.5 million last year, to close at $10.3 million.
Consequently, the company’s earnings per share increased by 64 percent to $0.36 from $0.22 earned in the same period last year.
The Chairman said cash generated from operations increased by 2 percent to $11.9 million, against $11.7 million achieved during the same period last year.
He said the marginal increase was mainly driven by increased profitability, decrease in inventory, improved collections and offset by significant reduction in creditors.
A dividend of $0.30 per share was declared which is an increase of 36 percent on last year. BAT has been one of the few companies on the ZSE to declare dividend periodically and consistently since dollarisation.
However in a presentation to analysts, BAT Financial Director Leslie Malunga said the company has been failing to remit dividend due to the parent BAT Plc now sitting at $12.3 million, for the third year running.
British American Tobacco PLC Zimbabwe (BATZ) is engaged in manufacturing, distributing and selling cigarettes through a network of independent retailers and distributors.
Listed in 1961 on the Zimbabwe Stock Exchange, BATZ produce Dunhill, Newbury, Berkeley, Madison, Everest and Kingsgate which it entirely sells in the Zimbabwe market and is a subsidiary of British American Tobacco group, the world’s largest cigarette producer.
