Joblessness takes its toll on BAT sales
BRITISHAmerican Tobacco, the cigarette giant behind the Dunhill and Lucky Strike brands, yesterday revealed that its sales volumes had dropped for the first time in two years, hit by downturns in key territories.
BAT said volumes had fallen in Japan, Russia, Brazil, Italy and South Africa, taking volumes overall for the group down three per cent in the nine month trading period.
Chief executive Paul Adams said: “Our consumers are clearly finding the current economic conditions difficult, as unemployment continues to rise.”
Total sales volumes for the group climbed two per cent if new acquisitions are counted in the figures.
“Group revenue for the nine months grew strongly, driven by the continued good pricing momentum and volume growth from the acquisitions made in the middle of last year,” BAT said.
It added that sales were also boosted by the more recent acquisition of an 85 per cent stake in the Indonesian group Bentoel in June. BAT paid £303m for the first 85 per cent of the group, recently adding a further 14 per cent shareholding for £52m.
BAT earlier this week announced plans to close a factory in Denmark in 2011 with the loss of 466 jobs, citing falling demand and high costs.
The company’s Danish subsidiary, BAT Denmark, said it would shut the site in Soeborg, northern Denmark — which produces 12bn cigarettes a year — and shift its production to other sites in Europe.