HARARE - Cigarette manufacturer, British American Tobacco (BAT), says it has invested $5,4 million in Zimbabwe over the past five years and plans to significantly boost capital expenditure (Capex) in the country this year.
The group — producing an average 130 million cigarettes per month at 65 percent capacity utilisation — said it will also focus on value addition.
“Our intention is to significantly increase our capex and the key focus areas are going to be further enhancements in manufacturing, health and safety and monitoring and distribution,” said managing director, Lovemore Manatsa.
“We want to cover the whole breadth of Zimbabwe through our marketing and distribution channels and this calls for massive investment,” he said.
BAT International Holdings UK Limited — the world’s second largest tobacco processor by sales —holds a 42,98 percent stake in the local unit while Old Mutual Life Assurance has an 11,97 percent.
Employees own a combined 20,76 percent with the rest held mainly by pension funds.
Manatsa said the Zimbabwe Stock Exchange-listed firm remained one of its strategic markets and BAT had no plans to divest from it.
“Our company plans forward. As such, in 2014, as we have done for over 100 years, we remain firmly focused on value-addition to Zimbabwe’s most valuable agricultural commodity — Tobacco,” he said.
“BAT Zimbabwe aspires to be a constructive partner and corporate citizen in the national dialogue on how to attract and retain investment in our manufacturing sector and country.”
“We believe we have a strong business in Zimbabwe because we uphold high standards of business conduct and this is recognised by all of our stakeholders,” said Manatsa.
BAT ranks among the top 10 performers on the local bourse and enjoys a 79 percent market share.
In 2012, it ceded a 26 percent stake to Zimbabweans in compliance with indigenisation laws, compelling foreigners to give majority shareholding to locals.
The company gave a 10 percent shareholding to a newly-established employee share ownership scheme and another 10,74 percent to a Tobacco Empowerment Trust for the benefit of development and support of indigenous tobacco growers.
This translated to four million shares worth a combined $20 million.
“We are incredibly proud of our commitment to our people and the country at large. Empowerment is entrenched within the way we do business,” said Manatsa.
“The BAT Zimbabwe Employee Share Ownership Trust and Tobacco Empowerment Trust evidence our investment in the sustainable development of our industry and country,” he said.
BAT is also ranked among the top revenue contributors to the fiscus having contributed over $28,6 million in excise duty, value added tax, and other tax payments to Treasury in 2012.