British American Tobacco Malaysia Reports 25% Drop in First-Quarter Profit
Today’s news, June 1: According to the New Straits Times, British American Tobacco Malaysia (BAT Malaysia) reported first-quarter net profit of RM40.32 million (US$8.76 million), compared with RM52.28 million in the same period last year. Group revenue fell 25%.
According to BAT Malaysia, the revenue decline was due to lower sales volumes caused by increased e-cigarette use and the continued presence of the tobacco black market.
The company’s total market share was 51.5%, down 0.4 percentage points from the first quarter of 2022.
BAT Malaysia Managing Director Nedal Salem said: BAT Malaysia is maintaining the growth trajectory of its strategic brands across its premium, aspirational premium, and value-for-money segments. This is aligned with the company’s goal of delivering combustible value growth to support its multi-category portfolio of lower-risk products.
“Our goal is to continue growing our heated tobacco product Glo, which represents our efforts to provide adult smokers with reduced-risk alternative options,” Salem said. “We will also focus on investing in our VFM brands and maintaining our leadership in the premium market.”
In the short term, the company expects the economic environment to continue putting pressure on financial performance. “We expect this challenging operating environment to further squeeze disposable income, leading consumers to switch from legal products to black-market tobacco alternatives.”
The company said: Nevertheless, in the medium term, we believe economic conditions will improve, while the government is looking to introduce balanced vaping regulations and accelerate intervention to reduce the tobacco black market.
