By Melody Chikono
BRITISH American Tobacco (BAT) says increased investment-related strategies led to a 27% rise in sales volumes compared to the same period last year despite the challenging operating environment exacerbated by the COVID-19 pandemic.
The investments were hinged on BAT’s brands and its route-to-market strategy.
Despite the economic challenges, BAT said it would remain committed and confident that its business strategies will deliver value growth for its stakeholders.
Results for the half-year ended June 30, 2021 show that BAT’s revenue grew 63% from $538,3 million to $1,4 billion compared to the same period last year.
The increase in revenue was driven by an uptick in sales volumes, higher prices and the export of cut rag tobacco.
BAT chairperson Lovemore Manatsa said these factors resulted in a gross profit growth of $30,8 million, 5% higher compared to the same period last year.
Net profit attributable to shareholders for the period under review was $470,3 million compared to a net profit of $152,5 million in the same period in prior year, representing a 209% increase.
“Selling and marketing costs went up by $80,2 million (92%) compared to the same period in prior year, driven by additional marketing investments aimed at driving sales volumes.
“The group’s earnings per share grew by 209% from $7,39 to $22,79 generated in the same period in 2020.
“Cash generated from operations was a positive $556,5 million against a negative $115,4 million in the prior year because of diligent customer collections, an increase in trade payables and a decrease in inventories as of June 30, 2021,” he said.
Meanwhile, the group’s taxes payable rose from $173 million in 2020 to $828 million for the period ended 30 June 2021, with the key contributors being tax payments related to increases in excise duty payable year-on-year as well as higher prices.