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Clara Mlambo

Business Reporter
Low-priced segment brand, Ascot volumes grew 278 percent to help British American Tobacco Zimbabwe record a marginal volume increase of 0,2 percent in the first half to June .

While other sectors of the economy are suffering reduced volumes and decline in revenue due to liquidity challenges and consumers facing a critical cash shortage, BAT is aggressively supporting its low-priced product to meet the market half way, according to managing director Clara Mlambo.

“Ascot is the new kid on the block. It’s been a brand that’s been around for about two–three years but not that much known because the trading environment was very different,” said Mrs Mlambo.

“Because it is a low price offer and given the challenges that are facing the market we have actually seen it grow and we’ve also been supporting it very aggressively particularly in terms of fighting versus competition.”

Ascot has low margins but high volumes as it is affordable to the market.

As a result of the stellar performance from Ascot, BAT total volumes grew 0,2 percent and net profit attributable to shareholders was at $4,6 million, which is an increase of $1 million or 27 percent compared to the same period last year.

The group’s earnings per share increased by 22 percent to $0,22 from $0,18 generated in the comparative period last year. The group declared an interim dividend of $0,22, which is an increase of 22 percent on last year.

In the outlook, Mrs Mlambo said the performance for the year could be boosted by promotions starting next weekend.

Madison Usadherere draws start next week while something is being planned for the Everest brand.

“First half performance was encouraging and we expect a good year based on those results. We are confident that the company will deliver a decent return on investment to our shareholders underpinned by our effective strategy that is in place, the strength and heritage of our brands and high calibre of our people,” said Mrs Mlambo

This is despite that trading conditions are expected to remain challenging in 2017. Mrs Mlambo believes that BAT controls about 78 percent market share having risen from about 76 percent in the last quarter.

“Just in terms of market share statistics we would want to increase our market share percentage points.

“Because of the consumer that we have been talking about, ,whose wallet is stretched and they need an offer we actually had to come up with an affordable offer.”