Increased volumes spur BAT profit

Mandevhani said increased sales volumes were registered in “key and iconic” brand Madison, which grew by 61 percent.
The tremendous increase in volumes helped turnover growth to US$39,8 million from US$22,9 million, an increase of 74 percent year on year.
Mr Mandevhani said on the back of the strong recovery to profitability, after a US$500 000 comprehensive loss the previous year, the group has declared a US$0,16 dividend to bring the total for the year to US$0,26.

Going forward, the group would be looking to sustain the growth pattern in both sales and value terms following re-introduction of the 10s pack with improved focus on effective distribution across the portifolio.
The 10s pack was launched last year after a four-year hiatus, but has been reintroduced to enhance convenience and affordability for customers.
“Improved quality in product delivery is also high on the agenda as we obtain the benefits of the machinery recently installed. As we move into 2012 focus will be on further volume and value growth,” said Mr Mandevhani.

During the period under review BAT registered significant volume growth in good quality flue-cured tobacco to auction and contract floors.
This resulted in increased demand for cigarettes by consumers and export flows to Mozambique while product diversity widened variety for customers.
Capitalising on the strength of its brands and distribution capacity to deliver volume and profit growth, the firm has built a sustainable business.

He attributed the overall improvement in profitability to the positive growth of the economy coupled with competitive strategies introduced by the firm.
The BAT chairman contends that the multi-currency introduced by the Government of National Unity had provided the platform for a stable environment.

This, said BAT, had paved the way for the business to concentrate resources on growth and profitability although certain challenges remained.
BAT noted that challenges that continue to affect business in Zimbabwe included the low-level foreign investment and liquidity constraints in the financial sector, as a result of the indigenisation policy.

Agriculture is this year expected to grow by 11,6 percent while tobacco is seen at 150kg and this is expected to leverage BAT volumes growth.