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British American Tobacco Uganda Limited (BATU) announced a 14% reduction in gross revenue to sh86b for the fiscal year ending December 31, 2023.

The listed firm on the Uganda Securities Exchange says the decline was primarily due to lower sales volume, reflecting ongoing challenges within the industry. The company reported a decrease in excise duty and Value Added Tax (VAT) by 19% to sh41b, indicating the impact of illicit trade on sales volume.

Despite efforts to mitigate these challenges, the illicit trade continues to affect the company's bottom line.

“Illicit trade also continues to undermine legitimate industry revenues,” BATU said in a statement.

BATU reported a total cost of operations decrease of 8% to sh31.9b, in line with lower sales volume and offset by prudent cost management strategies. This decrease was influenced by both lower sales volume and higher input costs.

Profit after tax saw a 9% decrease to sh9b, reflecting the combined effect of lower revenue and decreased operational costs.

Taxes, including Excise Duty, VAT, and Income Tax, decreased to sh46.2b, driven by lower sales volume and reduced profitability.

“Looking ahead, we are confident in our ability to navigate the increasingly challenging operating environment, powered by our world-class talent, consumer-centric brand portfolio, and sustainable trade partnerships. This is anchored on our robust Environment, Social and Governance (ESG) agenda,” BATU said.

The Board of Directors has proposed a final dividend of sh181 per share for the fiscal year ending December 31, 2023. The dividend recommendation is subject to shareholder approval at the upcoming Annual General Meeting scheduled for July 4, 2024.