BAT's 2005 net down 37% |
|
|
Published
:
Wed, 01 Mar 2006 06:15
|
LONDON: Cigarette maker British American Tobacco Plc. posted a 37 per cent drop in its net profit for 2005, which stood at 1.77 billion pounds, compared to 2.83 billion pounds in 2004. Revenue was down 13 per cent to 9.33 billion pounds.
The company said this has been mainly on account of gains made a year earlier by merging its U.S. business with R.J. Reynolds.
BAT, maker of Dunhill, Lucky Strike, Pall Mall and Kent brands, said it will achieve its target of 320 million pounds in annual cost savings by 2007. It is raising this target now by 25 per cent to 400 million pounds a year by 2007.
Company chairman Jan du Plessis said he is confident the company can deliver quality earnings growth and good cash flow over the long term.
BAT has shut at least eight plants since 2003, slashing more than 4,500 jobs.
The company had savings from job cuts and plant closures of 106 million pounds, bringing the total for the past three years to 226 million pounds.
According to analysts, BAT's cigarettes are chosen by one in seven of the world's one billion adult smokers. Its geographic spread is more than many of its rivals and it is less vulnerable to anti-tobacco campaigns and smoking curbs in individual countries. In Britain, where there is a ban on smoking in pubs, clubs and indoor public spaces, BAT is less exposed than rivals like Gallaher Group Plc and Imperial Tobacco Group Plc.
BAT said it is not planning to expand to China, where the government has said it will not allow new cigarette factories or joint ventures with foreign partners.
The company plans to raise its dividend 12 per cent to 47 pence a share.
BAT's shares rose 43 pence, or 3.2 per cent, to 1,371 pence in London. The company has said it would buy back close to the 500 million pounds of shares purchased in 2005.
|
|
|
|
|
|
Print this Story
BAT posts a profit of 23 per cent 