Cigarette sales reach pre-pandemic levels in third quarter

• CTC says sales recovered to early 2020 pre-pandemic levels
• Turnover tops Rs.44.5bn; earnings at Rs.4.9bn against Rs.4.5bn
• Excise and other levies grow by 26% and 28%, respectively

 Ceylon Tobacco Company PLC (CTC) said its sales reached pre-pandemic highs as the cigarette volumes picked up fast to surpass the year earlier levels in the three months ended in September 2020 (3Q202).  The sole cigarette manufacturer in the country reported revenues of Rs.44.6 billion for the three months to September compared to Rs.35.3 billion recorded in the corresponding period in 2019. 

The company said the volumes surpassed levels seen in the same quarter 
last year.  The sales during July-September quarter were the highest in any quarter. 

The growth in sales translated to over 26 percent between the two periods, a phenomenon which is bit more complex to explain as unlike consumer goods or consumer durables, it is difficult to assume that the pent up demand caused a surge in fags after the virus related restrictions 

were taken out.  However, retailers may have stocked up large quantities of packs than before the pandemic outbreak.  The company does exports too. “The company’s performance in the three months ended 30th September 2020, shows a healthy recovery reverting to nearly early 2020 pre-COVID-19 levels and posted a growth in sales volumes in comparison to the previous quarter of the year due to countrywide resumption of economic activities from mid-May onwards,” a CTC statement said.

In the previous quarter ended in June 2020, the company’s sales fell by a third to Rs.24.2 billions, as volumes slumped 38 percent due to nearly two-month lockdown. 

The company reported earnings of Rs.26.33 a share or Rs.4.9 billion for the three months to September compared to Rs.24.09 a share or Rs.4.5 billion in the comparable period last year. 

The company paid Rs.33.6 billion as taxes on turnover and another Rs.3.6 billion as corporate income tax.
The company announced its third interim dividend of Rs.19 a share to be paid by December 9, 2020. 

British American Tobacco International Holdings BV holds 84.13 percent stake in CTC followed by Philip Morris Brand SARL with a 8.32 percent stake.