TANZANIA Cigarette Company (TCC) profit for a half year period ending June 2013 has dropped slightly as the cigar manufacturer feels the pinch of increased tax and business fall for fast moving products.
The company said in its unaudited financial results in Dar es Salaam that during the six-month period ending June 2013, gross profit was 96.9bn/- slightly lower than the 97.4bn/- recorded in the corresponding period last year.
The net profit dropped to 44.3bn/- from 44.7bn/- in similar period last year, according to the report. The company said in the report that its gross turnover increased marginally by three per cent to 218bn/- from the corresponding period last year's 213bn/-.
Domestic sales volume, however, dwindled significantly as compared to the corresponding period last year due to pressure on disposable income, the impact of the 20.45 per cent excise tax increase in 2012 and the general down turn in the business climate for fast moving consumer goods.
The company expects slight improvements in the second half performance despite maintaining existing price levels of its product even with 10 per cent increase in excise duty in 2013, it said.
TCC's board of directors that met this week declared an interim gross dividend of 300/- per share, the report said. TCC posted a 21 per cent increase of net tax profit to 85.9bn/- in the year ending 2012, up from 70.9bn/- of 2011 according to the company's financial results ending December 2012.