The pandemic-induced intermittent lockdowns put a damper on the financial performance of Sri Lanka’s monopoly cigarette operator Ceylon Tobacco Company PLC (CTC), with the October-December 2020 quarter (4Q20) recording lower cigarette sales.
The local unit of British American Tobacco (BAT) reported sales of Rs.29.1 billion for the three months under review, down 18.3 percent from the same period
“The last quarter of the financial year saw a depressed economy with curtailed consumption, due to the restrictions faced by consumers and retailers to access the products, as a result of the intermittent curfews imposed to contain the second wave of COVID-19,” CTC said
in a statement.
The cigarette sales hit an all-time high for any quarter in the quarter ended on September 30, 2020, with sales reaching Rs.44.6 billion, largely due to pent-up demand
The company cut costs sharply during the quarter under review, as operating expenses were slashed to just a quarter of the Rs.2.0 billion spent in the same period in 2019. “The company managed to review the cost base and prioritise the spend to ensure health and safety standards for continuous operation of the manufacturing facilities and field operations while working from home arrangements were maintained for administrative staff,” the statement added.
The company reported earnings of Rs.19.29 a share or Rs.3.6 billion for the quarter under review, compared to Rs.21.36 a share or Rs.4.0 billion in the corresponding period in 2019.
For the 12-months to December 31, 2020, the company reported earnings of Rs.83.16 a share or Rs.15.6 billion on a revenue of Rs.132.1 billion, compared to Rs.141.3 billion in 2019.
CTC proposed a dividend of Rs.11.35 a share, as the final dividend for the year, subject to shareholder approval. The company paid Rs.100.1 billion in excise duties and Rs.9.9 billion in corporate income tax for the financial year ended on December 31, 2020.
BAT holds an 84.13 percent stake in CTC while Phillip Morris Brand SARL holds an 8.32 percent stake, being the company’s second largest shareholder.