@BusinessDaily

BAT share price tumbles to lowest since 2015 after profit fall

8 months ago, 7 Mar 15:00

By: Charles Mwaniki

BAT Kenya’s #ticker:BAT share price has fallen to a two-and-a-half year low at the NSE following the announcement of a decline in profit and dividend for the full year ended December 2017. The stock was trading at Sh680 per share on Wednesday, the lowest price since September 2015, having shed 13.5 per cent or Sh106 since the announcement of results three weeks ago. The company is operating under an increasingly difficult regulatory environment following the enactment of new laws meant to curb tobacco consumption, which has been linked to cancer. “BAT retreated to its lowest level since September 2015, mainly on foreign investor buying as the tobacco maker found support at the lower level after the rather disappointing 2017 results,” said Standard Investment Bank in a market update. The firm reported a 21.2 per cent drop in net profit for the full year to Sh3.3 billion, attributing this to lower sales in the wake of a weak performance in the Kenyan and export markets. Its volumes were also affected by floods and drought during the 2017 planting season, while local sales were also affected by excise tax increments. As a result of the declining revenue, the firm’s dividend payout also fell as the firm departed from its policy of paying out the entire net earnings to shareholders as dividends. This has disappointed investors who have been enjoying steadily higher pay-outs in recent years, a key factor in driving the share price to the upper triple digits. BAT paid a dividend of Sh43 in 2016, having reported a net profit of Sh4.2 billion in the year. “We await to see whether the change in pay-out policy is a one-off or will remain as this will have a significant impact on investor expectations,” said Dyer & Blair Investment Bank in their analysis of the company’s results. On its part, BAT has cited unpredictable tax increases as an ongoing threat to its Kenya business, calling on the government to introduce a more stable tax environment to allow the company to predictable operating environment.
Read More


Category: business opinion news corporate lifestyle markets economy

Suggested

11 hours ago, 18:11
@DailyNation -
North Rift politicians step up bid to control foreign tea estates

Counties in the Rift Valley have renewed their push for control of close to 45 large tea estates and 30 factories as most of the leases held by multinational corporations expire. ...

Category: topnews news business
12 hours ago, 17:49
@BusinessDaily - By: Victor Juma
UK company settles Sh100bn Migori gold mine licence dispute

London-based Red Rock Resources is set to resume production of gold estimated at more than Sh100 billion in Migori after settling a court case with the government which had terminated its mining ...

Category: business news corporate
11 hours ago, 18:34
@BusinessDaily - By: Bonface Otieno
Affordable homes get Sh21bn in budget reorganisation

The housing department is set to receive the lion’s share of Sh47.25 billion after the Treasury reorganised its spending plan in favour of President Uhuru Kenyatta’s “Big Four” economic plan. ...

Category: business news corporate economy opinion lifestyle markets
11 hours ago, 18:20
@BusinessDaily - By: Patrick Alushula
Kenya ranked Africa’s third most attractive finance market

Kenya is now ranked third most attractive financial market in Africa after South Africa and Botswana, buoyed by stronger policies and a host of newly launched products, a new survey shows. ...

Category: business corporate news markets economy lifestyle
12 hours ago, 17:12
@BusinessDaily - By: James Kariuki
Timber, furniture prices up 36pc after logging ban

The logging ban has triggered a 36.18 percent and 11.73 percent rise in timber and furniture prices, respectively, in the past year. ...

Category: business lifestyle news
11 hours ago, 18:11
@BusinessDaily - By: Tom Matoke And Wy ...
North Rift politicians step up bid to control foreign tea

Counties in the Rift Valley have renewed their push for control of close to 45 large tea estates and 30 factories as most of the leases held by multinational corporations expire. ...

Category: business news

@BusinessDaily

BAT share price tumbles to lowest since 2015 after profit fall

8 months ago, 7 Mar 15:00

By: Charles Mwaniki
BAT Kenya’s #ticker:BAT share price has fallen to a two-and-a-half year low at the NSE following the announcement of a decline in profit and dividend for the full year ended December 2017. The stock was trading at Sh680 per share on Wednesday, the lowest price since September 2015, having shed 13.5 per cent or Sh106 since the announcement of results three weeks ago. The company is operating under an increasingly difficult regulatory environment following the enactment of new laws meant to curb tobacco consumption, which has been linked to cancer. “BAT retreated to its lowest level since September 2015, mainly on foreign investor buying as the tobacco maker found support at the lower level after the rather disappointing 2017 results,” said Standard Investment Bank in a market update. The firm reported a 21.2 per cent drop in net profit for the full year to Sh3.3 billion, attributing this to lower sales in the wake of a weak performance in the Kenyan and export markets. Its volumes were also affected by floods and drought during the 2017 planting season, while local sales were also affected by excise tax increments. As a result of the declining revenue, the firm’s dividend payout also fell as the firm departed from its policy of paying out the entire net earnings to shareholders as dividends. This has disappointed investors who have been enjoying steadily higher pay-outs in recent years, a key factor in driving the share price to the upper triple digits. BAT paid a dividend of Sh43 in 2016, having reported a net profit of Sh4.2 billion in the year. “We await to see whether the change in pay-out policy is a one-off or will remain as this will have a significant impact on investor expectations,” said Dyer & Blair Investment Bank in their analysis of the company’s results. On its part, BAT has cited unpredictable tax increases as an ongoing threat to its Kenya business, calling on the government to introduce a more stable tax environment to allow the company to predictable operating environment.
Read More

Category: business opinion news corporate lifestyle markets economy

Suggested

11 hours ago, 18:11
@DailyNation -
North Rift politicians step up bid to control foreign tea estates

Counties in the Rift Valley have renewed their push for control of close to 45 large tea estates and 30 factories as most of the leases held by multinational corporations expire. ...

Category: topnews news business
12 hours ago, 17:49
@BusinessDaily - By: Victor Juma
UK company settles Sh100bn Migori gold mine licence dispute

London-based Red Rock Resources is set to resume production of gold estimated at more than Sh100 billion in Migori after settling a court case with the government which had terminated its mining ...

Category: business news corporate
11 hours ago, 18:34
@BusinessDaily - By: Bonface Otieno
Affordable homes get Sh21bn in budget reorganisation

The housing department is set to receive the lion’s share of Sh47.25 billion after the Treasury reorganised its spending plan in favour of President Uhuru Kenyatta’s “Big Four” economic plan. ...

Category: business news corporate economy opinion lifestyle markets
11 hours ago, 18:20
@BusinessDaily - By: Patrick Alushula
Kenya ranked Africa’s third most attractive finance market

Kenya is now ranked third most attractive financial market in Africa after South Africa and Botswana, buoyed by stronger policies and a host of newly launched products, a new survey shows. ...

Category: business corporate news markets economy lifestyle
12 hours ago, 17:12
@BusinessDaily - By: James Kariuki
Timber, furniture prices up 36pc after logging ban

The logging ban has triggered a 36.18 percent and 11.73 percent rise in timber and furniture prices, respectively, in the past year. ...

Category: business lifestyle news
11 hours ago, 18:11
@BusinessDaily - By: Tom Matoke And Wy ...
North Rift politicians step up bid to control foreign tea

Counties in the Rift Valley have renewed their push for control of close to 45 large tea estates and 30 factories as most of the leases held by multinational corporations expire. ...

Category: business news
Our App