British American Tobacco (BAT) Zimbabwe says cigarette consumption has dropped by 7%, a decline it attributes to reduced disposable incomes owing to macroeconomic challenges.
While the exact annual number of cigarettes smoked in Zimbabwe is not publicly available, market forecasts suggest national consumption could reach 531.4 million sticks by 2030.
In its trading update for the nine months ended September 30, 2025, BAT chairperson Lovemore Manatsa said tightening consumer spending was beginning to weigh on volumes.
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"Sales volumes declined by 7% to 593 million sticks, and consequently cigarette revenue fell 22% to US$21 million compared to the same period last year. This was due to stretched consumer spending, a challenging macroeconomic environment, and a shift in pricing strategy from ZWG to US dollars," said Manatsa.
Despite the volume and revenue drops, profitability recovered significantly. Profit before tax rose to US$11 million, a turnaround from a US$3 million loss recorded during the same period last year, a 491% year-on-year growth. The improvement was largely driven by reduced foreign-exchange losses and lower inflationary impacts.
Operating costs also fell sharply to US$10 million, a 66% decline from the prior year, reflecting lower forex losses, easing inflation pressures, and the implementation of cost-management initiatives.
The company noted that enhanced distribution efficiency, closer engagements with traders, and performance-focused trade programmes helped support volume delivery. BAT described the external environment as "dynamic but relatively stable," bolstered by steady inflation and a more stable exchange rate driven by ongoing monetary policy interventions.
However, Manatsa warned that challenges persist, including liquidity constraints, high borrowing costs, and frequent power outages that continue to disrupt industrial productivity.
"Looking ahead, the Company remains focused on reinforcing the strength and sustainability of the business by driving volume recovery through increased focus on the value segment, improving product availability across all markets and channels, and enhancing operational efficiency by optimising supply-chain processes and reducing our cost to serve in order to protect profitability," he said.
