British American Tobacco (BAT) Zimbabwe has recorded an 8 percent increase in revenue to $2,7 million for the year ended December 31, 2017 spurred by a strong sales performance.
Sales rose by 10 percent compared to the year earlier, largely due to increased volumes across all categories.
The company’s low value for money segment registered the biggest growth of 460 percent while Dunhill, the firm’s global drive brand, grew by 1 percent.
The solid sales performance, saw BAT chalking a gross profit of $2 million, representing an 8 percent growth compared to the year earlier.
In a statement accompanying the results, BAT chairman Lovemore Manatsa said the gross profit was also achieved due to “effective cost management measures taken by the company”.
“Administrative expenses were $2,7 million lower than the previous year which is 26 percent lower compared to 2016, driven by a reversal of tax related provisions, once off restructuring costs and savings initiatives implemented during the year under review,” said Manatsa.
Other income increased by $0,8 million (47 percent) compared to the same period in 2016 because of increased income from royalties.
Similarly, operating profit grew by 39 percent to $4,7 million compared to 2016, which saw it closing the year at $16,6 million.
Following the profit, BAT decided to declare a final dividend of 29c per share.
Coupled with the interim dividend of 22c per share declared during the previous year, the total dividend for last year was $51c per share.
In the period under review, earnings per share increased to $0,51 from $0,41.
This resulted in the net profit attributable to shareholders for the period rising to $10,6 million compared to $8,5 million in the comparable period, representing a 2,5 percent surge.
After a solid performance during the period under review, BAT’s contribution to the Zimbabwe Revenue Authority (Zimra) in taxes, including excise duty, corporate tax, VAT, Paye and withholding tax, jumped 8,3 percent to $32,5 million.
Excise, linked to higher sales and corporate tax driven by the increase in profitability, were the major contributors to the increase in taxes paid.
Going forward, Manatsa said BAT is “confident” that through its “effective business strategies”, the equity of its brands and the “quality of our people”, it continue to deliver growth and value for its shareholders.