HARARE, July 27 (The Source) – Cigarette manufacturer British American Tobacco (BAT) says net profit for the first half year to June grew 43 percent to $7,6 million compared with the same period last year on better production and distribution efficiencies despite weaker demand for its products.
Total sales volumes fell by five percent versus the same period last year, dragged by poor demand for local brands while its global brand Dunhill saw an increase in sales of four percent.
Revenue increased by eight percent or $1,5 million to to $21,7 million on the comparative period driven by marginal gains in pricing net of the impact of the excise duty increase in December last year.
In a bid to shore up dwindling revenue streams, government last year increased excise duty on cigarettes from $15 per 1,000 sticks to $20 per 1,000 sticks, which resulted in a 15 percent price hike.
“The company has worked hard to deliver efficiencies in its operating costs while continuously investing in our brands and distribution capabilities,” the company said in a statement to announce the results.
It said despite the reduction in volumes, independent research showed the company’s market share has increased in the first half of the year to over 82 percent.
Earnings per share for the period rose to 37 cents, up from 26 cents in that prior period. The company declared a dividend of 47 cents per share, with the total dividend at $8,3 million.