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Harare - BAT Zimbabwe continued to report impressive results, despite the deterioration of economic fundamentals in the country.
Speaking at the release of the company’s results for the year to end-December 2015, managing director Clara Mlambo said BAT Zimbabwe has successfully leveraged the strength of its brands to deliver a strong financial performance.
The company said the reporting period was characterised by decreasing consumer demand and other external factors, such as the depreciation of the rand.
As a result, the company’s total sales volumes for 2015 dropped 9% compared to 2014.
“The decline in volumes was driven by the challenging economic environment, which led to a contraction in the market size,” said BAT Zimbabwe.
However, the company defied the odds and posted growth in both the top and bottom line.
Revenue for the period rose by 2% to US$45.2m, driven by marginal gains from pricing net of the impact of the excise increase in November 2014, in spite of a drop in sales volumes.
Financial director Lucas Francisco said gross profit improved by $3.6m to $32.4m, mainly as a result of reduced raw material prices, productivity initiatives and cost containment measures.
Profit for the period amounted to $15.4m from $13.4m, while earnings per share were 75 US cents against 65c in 2014.
The group declared a total dividend of 91c, more than the current earnings of 75c.
Compliance certificate already issued
Francisco said BAT Zimbabwe is fully compliant with the country’s indigenisation laws and has been given a certificate of compliance by the Harare government.
This comes at a time when the government has said any person or business operating in Zimbabwe should be in possession of a letter of approval from the minister of indigenisation and economic empowerment as well as a compliance certificate from the National Indigenisation and Economic Empowerment Board by March 31 2016.
