, NAIROBI, Kenya, Feb 27 – British American Tobacco (BAT) shareholders will be taking home a total and final dividend of Sh42.50 for the full year 2014.
“The Board of Directors has recommended a final dividend of Sh39 per Sh10 ordinary shares at the AGM to be held on May, 5 2015.The final dividend when added to the interim dividend already paid, gives a total dividend of Sh42.50 per share,” BAT Managing Director Chris Burrell said during an investor briefing on Friday.
In 2013, shareholders of the listed firm got a final dividend of Sh33.50 ordinary share.
This follows the company’s improved performance in 2014 where the company made a net profit of Sh4.2billion compared to Sh3.7 billion in 2013.
The listed firm attributes the growth to improved performance in the domestic market which led to increased gross turnover, and decrease in financing costs.
“In regards to the Kenya domestic market we believe there is modest underlying growth. We have enjoyed excellent growth in our operating margins and we have every intention of continuing to do that,” Burrell told investors.
Cash generated from operations increased by 31percent to Sh6.6billion due to what the company termed as enhanced working capital management during the year as well as improved profitability.
The company has however admitted that the operating economic environment remained tough due to high fuel prices, exchange rate and insecurity cases in the country.
Contribution to government revenues in the form of taxes, increased by 6 percent to a record of Sh15billion in 2014.This increase was driven by higher excise duty and VAT from the domestic business as well as higher Corporation Tax.
The company say it will continue to holds talks with the government concerning the new tough regulations on the cigarette business which may have negative impact on the sector.
READ: Kenya imposes tough cigarette packaging rules
“There are a number of regulatory proposals facing the industry. We are committed to engaging openly on regulatory issues with relevant stakeholders seeking to ensure that the new regulations is balanced, evidence-based and does not stimulate illicit trade,” he said.
The new Tobacco Control Regulations 2014 were published by the Ministry of Health early this month and expected to take effect by June this year.
Manufacturers and distributors are required to put graphic images and warning messages on cigarette packages.
The new regulations build up on the Tobacco Control Act of 2007, requiring manufactures to submit to the Ministry toxicological data on the ingredients and leaf used for the products.