admin
Elton Manguwo
ZIMBABWE Stock Exchange (ZSE) listed cigarette manufacturing giant British America Tobacco (BAT) has recorded a revenue increase of 71 percent to Z$6, 95 billion in inflation adjusted terms for the half-year ended 30 June up from Z$4 billion that was recorded in the comparative period last year.
BAT chairman Mr Lovemore Manatsa highlighted that the revenue increase was a result of price increases effected in the financial period and the Z$2 billion cash generated from operations representing a 24 percent growth for the same prior financial period.
He further added: “These factors resulted in a 160 percent gross profit increase of Z$2,8 billion compared to the same previous period.”
As the Government intensifies calls for the country’s blue-chip companies to revamp the export market the group’s export volumes for cut rag tobacco managed to grow by 74 percent in the recorded period owing to an increased demand for the country’s tobacco leaf.
However, despite a soaring revenue increase the group’s cigarette sales volumes managed to dip by six percent and as a result, inflation eroded earnings.
“In a challenging operating environment volumes from the cigarette sales declined by six percent due to shrinking disposable incomes and currency devaluations in comparison to last year,” said Mr Manatsa.
More so, as the inflation rose to 256 percent from 96 recorded in April but the group is convinced that despite the resurgent inflation driven by instability in exchange rates they will not be hit hard, as they have come up with mitigatory measures to ensure consistent product supply at affordable prices thus satisfying customers needs.
BAT and its subsidiaries manufacture and distribute cigarettes to a network of independent distributors, wholesalers and retailers. The group has a cigarette manufacturing company that solely sells pure cigarettes to the Zimbabwean market and exports cut rag tobacco.
To add on, the group remains consistent in ensuring that tobacco farming remains sustainable amid threats from climate change that are rocking the agriculture sector. The company continues to implement various afforestation programmes aimed at preserving the natural environment, improve livelihoods and biodiversity in line with the ‘Better Tomorrow’ mantra.
The chairman concluded that the focus of the business would be on business continuity in the face of frequent policy changes, rising global and local inflation.
“We remain committed and convinced that our business strategies will deliver value growth to shareholders,” he observed.
Online Reporter