BAT to focus on a volume recovery plan

'Focusing on a volume recovery plan' - Manatsa, left, with Doona

Published: 13 September 2013

BAT Zimbabwe Managing Director Lovemore Manatsa told analysts yesterday that BATZ will continue focusing on a volume recovery plan as to stem volume decline which affected the firm's financial performance for the half year ended 30 June 2013.

"In terms of the second half outlook; challenging trading conditions are expected to continue. We have pressure in terms of volumes and in that regard we've got a few initiatives within the marketing division on how we can stem the decline and at least keep our volumes flat...for the rest of the year," he said.

Manatsa added that under indeginisation, the plan is to engage with the ministry within the set deadlines and "that is currently work in progress."

Group FD Peter Doona said 26% of the shareholding of BAT Zimbabwe now vests in the hands of indigenous Zimbabweans with 5% of those shares issued to Employee Share Ownership Trust (ESOT), 10.76% to BAT Tobacco Empowerment Trust while the remaining 5.24% on ZSE has been retained by existing indigenous shareholders.

BAT revenue remained stable at $23.13 million in the period under review from $23.01 million as "gains made from price increases net of excise on key brands in December 2012 offset the impact of lower sales volumes."

BATZ reported a loss of $1.4m for the half year ended June 30 2013, against a profit of $5m the previous comparative year.

The loss however came after the group accounted for a $10.6m indigenisation expense.

In a statement accompanying the group's results, management said the $10.6, share-based payment expense represented the fair value of shares awarded to employees through the Employee Share Ownership Trust as part of compliance with indigenisation laws.

Due to the loss for the period, the directors resolved not to declare an interim dividend.

BAT has been one of the best performing companies in Zimbabwe, declaring hefty dividends.

- zfn