BAT Uganda buoyant ahead of Shs209 per share dividend pay out in August

At the 23rd Annual General Meeting (AGM) sitting on Friday, 6 July 2023, shareholders of BAT Uganda approved Shs10.3 billion (Shs209 per share) as a first and final dividend for the year ended 31st December 2022.

The dividend, shareholders heard, will be paid net of withholding tax on 1st August 2023. This is in line with the Company’s 100% dividend payout policy.

Mathu Kiunjuri, the Managing Director of the cigarette, noted that their business operations in the country have remained solid with a sustained investment in the country in the last 95 years.

He, however, indicated that increasing incidence of illicit trade in Uganda remains a major threat to the sustainability of their business.

“During 2022, the incidence of illicit cigarettes saw a spike, from 23.8% in December 2021 to 29.4% in the same period in 2022. The consequent shrinkage of the legitimate market significantly impacts the sustainability of government and industry revenues,” he said.

Kiunjuri revealed that government loses an estimated Shs30 billion annually to the illicit cigarette trade. “Third party research indicates that most of the illicit cigarettes are being either misdeclared for export but find their way back into the local market, or smuggled in from neighbouring countries and beyond,” he said.

Uganda is also increasingly becoming a source of illicit cigarettes into regional markets such as Kenya, he added.

“Additionally, we continue to witness rampant non-compliance with the Tobacco Control Act, 2015 with unscrupulous traders selling cigarettes without the mandated graphic health warnings as well as sale of flavoured cigarettes.

“While the illicit trade situation is dire, we believe that the Uganda Revenue Authority (URA) has made significant gains thus far. However, for meaningful and lasting impact, it is critical that government redoubles its efforts, including ramping up multistakeholder and cross-border collaboration to ensure effective enforcement and enhancement of anti-illicit trade regulations.”

BAT Uganda Chairman, Dr. Elly Karuhanga expressed delight to mark 95 years since BAT started operations in Uganda.

He said they are proud of their contribution to the socio-economic development of the country, including supporting the livelihoods of over 30,000 Ugandans in the value chain, delivering sustained value to approximately 1,200 local (East African) shareholders and through sustained payments to the exchequer as one of Uganda’s leading taxpayers.