BAT Half Year Profit Rises To Ksh.2.9 Billion

 

By Kepha Muiruri For Citizen Digital

Tobacco manufacturer BAT Kenya Plc has posted a 7.4 per cent rise in net profit through the first six months of the year to Ksh.2.9 billion from ksh.2.7 billion previously.

The improved earnings for the firm have been supported by greater export volumes and higher tobacco prices in the domestic market against the backdrop of excise duty increases.

As such, BAT's gross revenues in the period have been booked at Ksh.21.9 billion or 8.4 percentage points higher than the Ksh.20.2 billion posted last June.

The higher revenues have served to offset both the rising cost of operations and higher taxes in the six-month cycle.

Operating costs for the firm have gone up by 15 per cent to Ksh.9.9 billion on higher input costs related to global supply chain challenges.

Meanwhile, cumulative taxes were up by two per cent to Ksh.9.4 billion reflecting higher exercise duty rates and profitability.

The higher tax liability for BAT covers recent increases in exercise duty rates including by five per cent in November 2021.

The impact of higher duty is expected to remain profound in the second half of the year following a 10 per cent increase in the rate of excise duty in July 2022.

BAT’s Board of Directors has recommended the payment of an interim dividend of Ksh.5 per share or a combined payout of Ksh.500 million, payable on or around September 16.