By Silvia Nyambura
Cigarette Company British American Tobacco (BATU) has registered a 240.04 percent increment in profitability from Ushs 10.81billion (USD 3.62million) to Ushs 36.75billion (USD 12.31million) year on year.
The company restructured its operations in the third quarter of 2014. BATU closed its leaf operations in Uganda due to termination of the supply partnership with one of their biggest clients, British American Tobacco Global Leaf Pool Limited (GLP).
Volumes of cigarette sales increased by 3 per cent in the past year on the back of higher Safari brand sales. At the USE, the company’s earnings per share grew to Ushs 748.82 from Ushs 220.21 year on year reflecting growth in company earnings.
The BATU Board of Directors recommended payment of a notable Ushs 784 per share dividend for the year ended December 2014 compared to Ushs 141 in 2013.
With a 12 month target price of Ushs 15,736, the Company’s prospects coupled with its attractive dividend policy (100 per cent of its net profit) and the tight liquidity conditions of the counter could bring about a possible further increment in the share price of BATU.
