Shareholders of British American Tobacco Uganda (BAT Uganda) are set to earn a total of Ushs 20.3 billion as dividends for the year ended 31st December 2015.
Following another solid performance by the company, the Board of Directors recommended a final dividend of Ushs 413 per share for the just concluded year.
In his remarks at the company’s 16th Annual General Meeting held in Kampala today, Mr. Dadson Mwaura, Managing Director of BAT Uganda said, the company will pay the dividend in line with its policy of 100% dividend pay-out, subject to withholding tax, on or before 21st June 2016 to shareholders on the register as at the close of business on 31st May 2016.
The dividend payment comes on the back of a good financial performance by the company in 2015 during which the business registered a profit after tax of Ushs 20.3 billion.
The Company’s total revenues were 26% lower as a result of lower leaf export volumes following the discontinuation of their leaf business in 2014. However, cigarette revenues increased by 6% from Ushs 64 billion in 2014 to Ushs 70 billion in 2015 mainly due to price increases on some of BATU’s major brands.
In his remarks after the meeting, the Board Chairman, Hon. Dr. Elly Karuhanga, commended BAT Uganda on its good performance despite being majorly impacted by difficult economic conditions which included significant depreciation of the shilling against the US dollar coupled with amongst others inflation that was significantly higher in 2015 compared to 2014. This led to exchange losses in the company’s foreign transactions. Cigarette sales volumes were also impacted by the 29% increase in cigarette excise taxes in July 2015. He noted that illicit cigarettes at 20% remained a key concern in addressing loss of legal industry cigarette volumes as well as stemming loss of government revenue in Uganda.
“Despite these challenges the business managed to reduce operating costs and grow its cigarette revenues”.
Commenting on the new legislation for the industry, The Tobacco Control Act 2015, Mr Mwaura said, “We do welcome the regulation of the sector, but maintain that it should be fair and balanced to be able to deliver the public health objectives while taking into account the legal rights of the industry and those who derive their livelihoods from the sector.” Mr. Mwaura further added that whereas significant reviews were done in some areas of the law towards making it more effective, a few aspects remain a challenge owing to their complexity and impracticability in terms of effective enforcement and validity. “This remains a key area of focus for our engagements and planning as we continue to advocate for a reasonable, evidence-based and enforceable law.” Said the BATU Managing Director.
BAT Uganda shares remain the best-priced on the USE at the moment, trading at an average of Ushs 30,000 per share. The said shares were priced at Ushs 8500 at the end of 2014. The shares have consistently remained competitive on the stock exchange.
