British American Tobacco Bangladesh (BAT Bangladesh) has announced that its cigarette sales for the first quarter of 2026 declined by 14% year-on-year, while profits fell by 34% during the same period.
Key Highlights
- BAT Bangladesh sales down 14%;
- Q1 profits slide 34%;
- The market faces pressure from inflation and tax burdens.
- Demand for traditional cigarettes remains under pressure.
BAT Bangladesh Q1 Sales and Profit Decline
May 15, 2026. According to The Business Standard, British American Tobacco Bangladesh reported that its cigarette sales for the first quarter of 2026 declined by approximately 14% year-on-year, while its profits fell by 34% compared to the same period last year.
The financial report reveals that the company sold a total of 92.31 billion cigarettes in the first quarter of this year, down from 107.39 billion units in the corresponding period of the previous year, marking a reduction in sales volume of approximately 15.07 billion units.
Earnings and Revenue Drop Amid Weak Demand
During the same period, the company’s profit dropped to BDT 20.95 billion (approximately US$172 million), with Earnings Per Share (EPS) standing at BDT 3.88. This compares to a profit of BDT 31.795 billion (approximately US$261 million) and an EPS of BDT 5.89 in the first quarter of the previous year.
Reflecting the decline in sales volume, the company’s gross revenue fell by 9.08% year-on-year to BDT 872.5 billion (approximately US$7.17 billion).
Following the release of the financial results, BAT Bangladesh’s share price on the Dhaka Stock Exchange (DSE) dropped by 1.52%, closing at BDT 214 per share (approximately US$1.76).
The company stated that the decline in profits was primarily attributable to the reduction in both sales volume and revenue.
Operating Costs Rise Despite Lower Finance Expenses
Financial data indicates that the company’s operating expenses rose by 41% year-on-year, increasing from BDT 16.478 billion (approximately US$135 million) in the first quarter of 2025 to BDT 23.183 billion (approximately US$190 million).
Meanwhile, its finance costs saw a slight decrease, falling to BDT 4.924 billion (approximately US$40.4 million).
Negative Operating Cash Flow Continues
BAT Bangladesh noted that, due to reduced cash inflows from sales and an increased reliance on short-term borrowings to meet working capital requirements, the company’s operating cash flow per share remained negative.
Data indicates that the company’s operating cash flow per share stood at negative 22.70 Taka (approximately negative US$0.19), compared to negative 17.62 Taka (approximately negative US$0.14) during the same period last year.
The financial report also reveals that the company’s Net Asset Value (NAV) per share rose to 103.38 Taka (approximately US$0.85).
High Taxes Continue to Impact Tobacco Industry
Regarding taxation, during the quarter ending March 2026. The company paid a total of 729.2 billion Taka (approximately US$5.99 billion) in supplementary duties and Value Added Tax (VAT) to the Government of Bangladesh, against gross sales of 872.5 billion Taka (approximately US$7.17 billion) for the same period.
Additionally, the company incurred income tax expenses amounting to 28.5 billion Taka (approximately US$23.4 million).
In comparison, its expenditure on supplementary duties and VAT during the first quarter of 2025 stood at 773.31 billion Taka (approximately US$6.35 billion).
Domestic Sales Weaken as Export Revenue Remains Limited
In terms of revenue structure, the company’s gross domestic sales revenue declined to 841.6 billion Taka (approximately US$6.91 billion), while it generated 24.622 billion Taka (approximately US$202 million) in revenue from third-party sales.
The financial report indicates that the company generated no revenue from the export of finished products; however, revenue from tobacco leaf exports amounted to 5.913 billion Taka (approximately US$48.5 million).
Net income after tax declined from 186.4 billion Taka (approximately US$1.53 billion) in the corresponding period of 2025 to 143.278 billion Taka (approximately US$1.18 billion).
Inflation and Consumer Pressure Weigh on Cigarette Demand
Reports note that the tobacco industry in Bangladesh is currently facing multiple pressures. Including high inflation, increased taxation, and a decline in consumer purchasing power.
Industry observers suggest that, against the backdrop of persistent economic pressures, some consumers may reduce their cigarette consumption or switch to lower-priced products.
Meanwhile, global tobacco companies continue to advance their new nicotine businesses, such as vapes, heated tobacco products, and oral nicotine products in an effort to mitigate the impact of slowing growth in the traditional cigarette market.
