The Demerara Tobacco Company’s (Demtoco) after-tax profit for 2022 was $2.077b, 2.5% higher than the $2.026b in 2021.
In its annual report for 2022, the company said that it delivered earnings per share of $88.76 last year versus $86.59 in the prior year and total dividend payments of $1.921 billion were distributed in 2022.
“Overall, the Company saw growth in revenue of 5.8%, with a favourable movement in operating profit of 3.6% mainly driven by increased revenue and efficiencies in operating costs”, the company said.
“Demerara Tobacco Company has continued its trajectory of growth, achieving 3.6% growth for the second consecutive year, compared to 2021. This outstanding performance resulted in a total of 441mn sticks being sold, and was made possible through the enhancement and transformation of our brands portfolio, the unwavering loyalty of our customers, and the support of our retailers”, the report said.
In a release, the Managing Director of Demerara Tobacco Company Limited, Vijay Singh, also highlighted that Demtoco’s “share price at the close of the financial year stood proudly at G$3,000 representing a 50% increase which solidifies the confidence of our shareholders and commitment of management to deliver on expectations. “
Singh in his report at the company’s 89th Annual General Meeting on April 21st, highlighted the threat of illicit trade as the greatest risk to their business and the wider business community.
“The company believes that the rapid increase and far-reaching presence of illegal cigarettes will negatively impact their business, government revenues and further incentivize criminal activities in the communities. He noted that If things continue as they are, the company stands to see this illegal trade grow by a further 10% by 2024, which will be at unmanageable levels in the market. The company has seen a similar situation play out in neighbouring Suriname, in which, the trade, left unchecked, ruined the revenue streams for the government and the legitimate industry”, the release added.
In Guyana, Demtoco says it has been receiving support from the various law enforcement agencies and this is noteworthy. However, the Managing Director stated that much more has to be done and at an accelerated and urgent pace as the illicit traders are increasing their market share on a daily basis. He said the company remains committed to raising awareness of this issue through active engagement with regulators, government, and the private sector.
Despite the challenges posed by the illicit trade, the release said that the company’s premium brand Dunhill grew significantly by 11%, driven by continuous innovation that the brand offers which consumers embraced, and its Pall Mall brand experienced a 7% growth.
Demerara Tobacco Company’s Managing Director urged shareholders to highlight this plight to ensure public awareness is at its peak. The company remains committed to ensuring sustainable growth through continuous improvements in their portfolio, distribution, and retention of the best talent in the market.
To achieve government public health objectives, addressing the size of the illicit market is critical, and Demtoco urged increased enforcement by both local and regional authorities to disrupt the supply chain to facilitate the creation of A Better Tomorrow.
