BAT has posted a profit after tax of Sh3.075 billion in the first six months of 2026, a performance the company has described as resilient against a challenging operating environment.
The profit for the period that ended on June 30, 2026, was a slight improvement compared to Sh2.983 billion posted in the same period last year.
As a result, the company has approved an interim dividend of Sh10 per share for the year ending on December 31, 2026.
The increase was as a result of the company growing its net revenue by five per cent to Sh12.3 billion, driven by recovery in export sales and modern oral nicotine pouch sales following the launch in June 2025.
This increase is said to have offset the impact of lower sales volumes and consumer downtrading in the domestic market.
Total cost of operations increased by seven per cent to Sh8 billion, which the company explained in a statement that it was mainly driven by higher input costs together with additional expenditure to comply with graphic health warning regulations and support the company’s multi-category product portfolio.
Operating profit also increased by one per cent to Sh4.3 billion, as revenue growth and productivity savings from sustained operational efficiencies helped absorb higher input costs.
This is while profit before tax increased by two per cent to Sh4.4 billion, due to the increase in operating profit and higher finance income.
BAT Kenya Managing Director Sidney Wafula said illicit cigarettes remain the major challenge for the company’s business.
"These results reflect the agility of our business in navigating an increasingly complex and dynamic environment," he said.
“In the domestic market, the growth in illicit cigarettes estimated at 45 per cent as at the end of 2025 (according to third-party research), remains the most significant threat to the sustainability of the legitimate industry and supported value chains,” he said.
He pointed out that this denies the government much needed revenue estimated at Sh12 billion annually.
“Consumer disposable income was further constrained by elevated fuel prices associated with the ongoing Middle East conflict, resulting in lower cigarette sales volumes,” he said. “Modern oral nicotine pouch sales continue to contribute to the company’s revenue following the launch in June 2025.”
Wafula said the export markets were exposed to similar macroeconomic challenges and adverse weather conditions, while currency stability in key markets helped moderate the impact of adverse macros on revenue.
“In line with our continued commitment to deliver sustainable shareholder value, the Board of Directors has approved an interim dividend of Sh10 per share for the year ending 31 December 2026,” he said.
