Listed cigarette manufacturer, British American Tobacco (BAT) Zimbabwe defied the unprecedented level of uncertainty brought about by the Covid-19 pandemic, which worsened the already challenging economic environment, to post more than expected performance, Business Times can report.
According to its financial results for the six months to June 30, 2021, published this week, revenue for the group grew 63% to ZWL$1.4bn in the reviewed period from ZWL$848.3m reported in the prior comparative period.
The jump was largely attributable to increased sales volume, price increases implemented during the period and the export of cut rag tobacco.
Net profit increased 208% to ZWL$470.3m from ZWL$152.5m achieved in the same period in 2020.
Cash generated from operations was a positive ZW$556.5m against a negative ZWL$115.4m in the prior year because of diligent customer collections, an increase in trade payables and a decrease in inventories as of 30 June 2021.
BAT chairman Lovemore Manatsa said: “….The disruptions caused by the COVID-19 pandemic continued to weigh down on economic activity in the country, limiting consumers’ purchasing power and the normal trading hours of most businesses. Despite these challenges, the group came up with mitigatory measures to ensure consistent product supply thus satisfying our consumer needs.”
Selling and marketing costs went up by 92% to ZWL$80.2m compared to the same period in the prior year, driven by additional marketing investments aimed at driving sales volumes.
Administrative expenses shot up 168% to ZWL$109.3m, driven by a general increase in costs.
Manatsa said the group remained committed and confident that the business strategies will deliver value growth for its stakeholders.