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DEMTOCO records drop in profits for first half of 2017
The Demerara Tobacco Company Limited (DEMTOCO) in its interim financial report for
the first half of 2017 has announced that its performance declined when compared to the same period last year. The report takes into account profit made in the first half of the year ending on June 30, 2017.
According to the Chairman’s report by Chairman of the Board of Directors, Felicio Ferraz, gross profit for the first half of 2017 was stable when compared to the same period of 2016, despite lower sales volume.
Profit before Taxation decreased by just four per cent (versus the first half of 2016) primarily due to increased overheads and expenditures on marketing activities, to support the company’s sales volume achievement despite the reduced consumer disposable incomes seen in the market. This move facilitated the delivery of the promised shareholder value.”
For the first half of 2016, the company recorded a Profit before taxation of some $1,3 billion. However, for the same period this year, the company recorded a Profit before taxation of $1.2 billion.
Ferraz reported that the company continues to invest in its portfolio of brands that include Pall Mall, Bristol and Dunhill.
“Great focus was also placed on working closely with the retail and wholesale channels to ensure they continue to invest in our brands, thereby supporting the legal tobacco portfolio in the market.
“As we enter the second half of the year, and into 2018, we will continue to engage with our consumer and customer base, to ensure we can consistently deliver the positive returns for our valued stakeholders and shareholders alike.”
He said that the company seeks ways to increase shareholder value and in this vein, the Board of Directors approved a second interim dividend of $16.38 per share to all shareholders on the register as at August 11, 2017. This register will be closed from August 8 to August 11 for payment of the second interim dividend.
Meanwhile, the Board Chairman said that his company has taken note of the recent passage of the Tobacco Control Bill 2017. He reiterated that DEMTOC is not opposed to the regulations and intends to comply fully while working with its retailers and consumers.
Despite this, the Chairman said that the company is still appealing to President David Granger for a review of the Bill by a sub-committee to ensure a balanced legislation that will not only regular all players in the industry but respects and protects the rights of adult smokers.
He mentioned that the company has been in existence for the past 83 years as a legal entity and has always taken steps to market and distribute its products in a responsible manner.
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