Kampala. British American Tobacco Uganda has said it will pay Shs13.7b to its 1,232 shareholders as dividends for the year ended 2018.
The payout represents a 14 per cent increase compared to Shs12b that was paid for the year ended 2017.
The payout was approved during the company’s annual general meeting in Kampala with each share being paid Shs280.
In the year ended 2018, BATU posted a profit of Shs13b up from Shs12b in 2017.
While addressing journalists shortly after the annual general meeting, Mr Mathu Kiunjuri, the BATU managing director, said the company had decided to payout 100 per cent of its profits in dividends, a policy that was also followed in 2017.
“The company delivered a strong set of results in 2018.
These results were achieved despite the illicit trade in cigarettes in Uganda, which averaged at 22 per cent in 2018 [source:Quarterly Market Tracker],” he said.
The illicit levels, he said, had negatively impacted BATU as well as denying government revenues.
Mr Kiunjuri said that the company has maintained its 100 per cent profit payout policy because they had generated enough capital levels to smoothly run its operations.
In the year ended 2018, BATU’s gross revenues increased by 3 per cent to Shs154b, driven by excise-led pricing in the market.
This was partially offset by lower volumes as a result of consumer-affordability challenges and the adverse impact of illicit trade.
The company also saw its cost of operations rise marginally by 1 per cent to Shs49.9b but this was, according to BATU partially offset by productivity improvement initiatives.
Dr Elly Karuhanga, the BATU chairman, said the company had paid Shs90.5b in taxes for the year ended 2018. However, he noted that the company has lost about Shs26b due to illicit trade in cigarette.