BAT profits up 22pc to Sh4.1b despite influx of illicit cigarettes

BAT - BAT profits up 22pc to Sh4.1b despite influx of illicit cigarettes

NAIROBI, Kenya, Feb 14 – British American Tobacco Kenya has posted a 22 per cent increase in profit to close 2018 with a net profit of Sh4.1 billion.

Net revenue increased by 11 per cent to close at Sh20.8 billion driven by excise-led pricing in the Kenya and export markets.

BAT Kenya Managing Director Beverley Spencer-Obatoyinbo said the company delivered strong performance in a difficult trading environment where illicit cigarettes in Kenya has risen.

“Worryingly and despite heightened attention from the authorities – whose efforts we welcome and fully support – this figure had reached 14.1% at the end of 2018 from 12 percent in the previous year, meaning that some 700 million cigarettes in the market have evaded tax and denied as much as Sh2.5 billion in revenue to the Government,” said Obatoyinbo.

“From our research the majority of illicit cigarettes seen in the Kenyan market appear to be labelled as one product – Supermatch. Other industry players have also recognised the prevalence, denied their involvement and raised similar concerns with the relevant authorities.”

The company contributed Sh18.3 billion to the exchequer in the same period.

Shareholders will receive a total dividend of Sh35 per share.

“Going forward, regulatory and fiscal stability in the domestic business is critical for business growth and to further contribute to the advancement of manufacturing as a pillar of the Government’s “Big Four” agenda,” added Obatoyinbo.

BAT Kenya Chairman, George Maina said the company invested over Sh600 million to transform the Nairobi manufacturing hub into a “modern and great place to work for employees.”

With this infrastructure, alongside the exceptional quality of talent within the Company and our partnerships with over 80,000 trade partners and tobacco farmers, I am confident that we have the right strategy and the right people in place to deliver business growth and continued value to all our stakeholders in the years ahead.”

Author: worldwidenewscast

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