HomeNewsBAT sales rise as economy stabilises

BAT sales rise as economy stabilises

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British American Tobacco Limited (BAT) says it expects to sell more cigarettes in the second half, but does not see prices increasing to catch up with the rest of the region.
The firm said so after reporting that cigarette sales volume increased to 518 million in the first half of the year from 369 million last year.
But exports remain under pressure. The company’s second half outlook is based on domestic demand, which is seen firming as the country’s economic recovery progresses.
Domestic cigarette sales volumes were up by 40% compared to the same period last year due to economic stability that has enhanced disposable income and demand for consumer goods on the market.
The group recorded a 76% increase in turnover to $9,3 million compared with $5,310 million in 2009.The increase in turnover resulted in the surging of operating profit to $367 000 from $223 000.
Profit before income tax declined to $167 000 compared to $260 000 the prior year.
Kennedy Mandevhani, BAT chairman, said price increases in key brands that include Madison enhanced the results although prices are still low compared to the region. BAT’s exports volumes were lower for the first six months of this year, due to timing differences and a late start to demand for export requirements.
“Cut rag shipments to Mozambique finished the first half of the year 2% lower than the same period in 2009,”said Mandevhani.
Total assets the group stood at $22,8 million while total borrowings were at $5,9 million for the first six months of the year.
Mandevhani said BAT would continue to review its operations in line with the demands of the environment.
The company is expecting to record improved sales in the second half of the year as the country continues to achieve its economic potential.
On the other side BAT International recorded group volumes of 348 billion, for the first six months of the year as a result of the acquisition of Bentoel offset by market size.
Group revenue grew by 4% at constant rates of exchange and by 8% at current rates while adjusted profit from operations improved by 9% at constant rates and by 14% at current rates.

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