BAT's Sales and Profits Plummet by 10% in Bangladesh

According to a report from TBS News, British American Tobacco (BAT) has experienced a significant decline in sales and profits in Bangladesh. This is primarily due to a decrease in tobacco exports and a dramatic reduction in domestic tobacco sales.

According to the financial report of the company for the period of January to March, the multinational tobacco producer's gross revenue decreased by 5% to a total of 940.7 billion taka. The government received 741.3 billion taka from tobacco value-added tax and other taxes. The company's net income also decreased by 12% to 199.4 billion taka, with profits declining by 9.41% compared to the same period last year, amounting to 41.3 billion taka.

At the same time, the company's cigarette sales decreased by 10.39% and tobacco exports dropped by 81% to 1.8 billion takas, compared to 9.5 billion takas in the same period last year. The company's earnings per share (EPS) fell to 7.65 takas by the end of March 2024.

After the financial report for this quarter was released at the Dhaka Stock Exchange on Tuesday, the stock prices of BAT in Bangladesh fell by 2.57%, closing at 363.30 taka. Its Net Operating Cash Flow Per Share (NOCFPS) was -10.49 taka, compared to -2.09 taka in the same period last year. The report attributed this decrease in NOCFPS compared to the previous year to higher consumption taxes and tax payments.

According to data released by the Bangladesh Bureau of Statistics on May 13, the food inflation rate in April soared to a near five-month high of 10.22%, while the non-food inflation rate was 9.64% in March and slightly decreased to 9.34% in April. Analysts believe that inflation may impact cigarette sales as people are now more focused on food purchases. Additionally, the Ramadan month may also affect sales of cigarettes.

According to a disclosure on the Dhaka Stock Exchange website on Tuesday, British American Tobacco (BAT) reported a decrease in its earnings per share (EPS) in Bangladesh compared to the same period last year, mainly due to a decrease in sales volume and tobacco exports. In the first three months of 2024, BAT's cigarette sales in Bangladesh decreased from 179.9 billion to 161.2 billion compared to the same period last year.

Since 1977, British American Tobacco has been publicly listed on the Dhaka Stock Exchange. In addition to producing tobacco products, it also sells brands such as Benson & Hedges, John Player Gold Leaf, Capstan, Star, Royals, Derby, Pilot, Hollywood, and Lucky Strike. It has tobacco factories in Dhaka and Savar, a green tobacco threshing plant in Kushtia, and a green leaf re-drying plant in Manikganj.

In 2023, BAT's net income in Bangladesh increased by 8.83% to 916.7 billion Taka, with a slight increase in profits to 178.8 billion Taka. It also obtained revenue of 47.296 billion Taka from tobacco exports, all of which are detailed in its annual report.