British American Tobacco (Malaysia) Berhad (BAT Malaysia)  today announced its financial results for the third quarter ended 30 September 2024 (Q3 FY2024).

Q3FY2024 Financial Highlights: 

• Volume increased by 3.3% compared to same period last year leading to a 0.5% rise in  revenue totalling RM609.9 million. 
• Profit from operations for the quarter was RM99.5 million, 17.1% higher than same  period last year. 
• The Board of Directors has declared a third interim dividend of 22 sen per ordinary share  amounting to RM62.8 million, payable on 27 November 2024 to shareholders. 

For the quarter under review, BAT Malaysia saw a 3.3% increase in overall volume as compared  to same period last year. As a result, the Group saw a 0.5% rise in revenue totalling RM609.9  million. The growth was largely attributed to a better product mix and increased sales from  vapour products, partially offset by higher investment. 

Although gross profit margin dipped by 1.3% due to the lower margin of vapour products,  operating expenses were significantly reduced by 28.9% as compared to last year given the  Group’s substantial investment in the launch of Vuse in Malaysia last year. As a result, profit  from operations for the quarter increased by 17.1% to RM99.5 million compared to the same  period last year. 

The Board of Directors has declared a third interim dividend of 22 sen per ordinary share  amounting to RM62.8 million, payable on 27 November 2024 to shareholders. 

Nedal Salem, Managing Director of BAT Malaysia, said, “Our financial performance for  Q3FY2024 has been encouraging especially with the progress made by Vuse, the No. 1 global  vaping brand*, in steering the Group’s growth in Malaysia. 

Our investments to-date are showing promising results as it has led to the Group having a  better product mix and increase in volume. The Group remains optimistic that its performance  will continue to strengthen, backed by its multi-category portfolio as the Group aims to  continue growing Vuse. The progress positions us well to drive our ambition in Malaysia to  build A Better TomorrowTM.”

*Based on Vuse estimated value share of vapour pods and pre-filled devices from Recommended Retail Price in total measured  retail in key vapour markets: USA, Canada, France, UK, Germany, Poland and Spain as of May 2024. 

The Group also notes that the Control of Smoking Products for Public Health Act 2024 and its  related regulations (Act 852) have been gazetted and taken effect with measures to be  implemented in phases in 2024 and 2025.  

“While the new Act 852 and its regulations have taken effect, it is still too early to make an  assessment on the impact of the Act 852 and its regulations. Additionally, we believe that it is  important for the industry to be given sufficient time to comply to the new regulations and we  urge the Government to continue to have dialogues with the industry during this transition  period to ensure there is no disruption to the market.” 

Commenting on the recent Budget2025 announcement, Nedal said that while the  Government has announced additional allocation for the enforcement authorities to address  smuggling activities and that there has been success in addressing smuggling activities in the  country, the incidence of tobacco black market remains at a high level and needs attention. 

“We are encouraged by the recent intensified enforcement actions from the Royal Malaysian  Customs Department in addressing the tobacco black market. While the incidence of tobacco  black market has been on a declining trend since 2020, it continues to be at a high of 54.4%1in  July 2024 and the Government needs to continue to focus its attention and resources to  address the issue. Apart from the proactive work done on the enforcement front to curb the  supply, the Government should also develop solutions that would address the issues to curb  demand of black-market products.” 

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