Roth--a International
Int--oduction
At the meeting of the Tobacco Strategy Review Team
on 2nd December 1991, the
Chairman asked for an analysis to be made of
Rothmans' profits to assess
whether the analysts' favourable view of their
increased profitability was
justified.
The latest results, for the six months to 30th
September 1991, show some
imorovement on the comparable period in 1990:
6 Months to 30th September 1990 1991
Net Turnover (Em) 1,022 1,085
operating Profits (fm) 166.9 180.1
Margin M 16.3 16.6
The improvement in profits is said to be due to
improved profits in Canada,
France, Germany, Malaysia, New Zealand and Poland,
offsetting a decline in
Australia. Profits in Australia were also said to
be affected by a change in
accounting treatment which reduced operating
profit by 10.1 million. Without
this adjustment, the margin would have improved to
17.5%.
Even at this level, the margins are still
significantly below the 23.3'. and
23.8.' achieved by B.A.T Industries in 1990 and
1991 respectively.
There is no country by country analysis available
for Rothmans' half year
results but an analysis of the full year results
for the periods to 31st
March 1990 and 1991 is shown below:-
Whole
GrouD Australia Malavaia Canada UK(a) Otbers(b)
Turnover 1990 E1914m A$1337m M$ 666m C$388m f400m
E696m
1991 E2051m A$1624m M$1020m C$417m E440. E862m
0,D. Profits 1990
1991
Margins 1990
1991
BAT Margins 1990
1991
E 325m
E 352m
17.0%
17.1%
23.3%
23.8%
A$ 130m
A$ 185m
9.7t
11.4%
6.2.
2.9%
M$ 162m C$119m E 49m E 82m
M$ 269m C$lllm E 55m E113m
24.2% 30.6% 12.3. 11.8Z
26.4% 26.5% 12.5Z 13.1%
20.21 36.8% 27.4, 15.2%
15.9% 35.7Z 30.31 16.3%
Notes (a) Rothmans includes domestic and exports.
BAT = BATUKE.
(b) Rothmans 'Others' includes Germany, Singapore,
Netherlands,
Switzerland and Belgium. BAT = BATCF.
The 1991 Rothmans' margin for Singapore was 23.22
compared with 17.8% for BAT.
The 3AT margin in Belgium was 11.4% and in
Switzerland 15.9%.
conclusion
While there has been some improvement in margins,
especially in Australia,
Malaysia and Europe, the level is still relatively
low in Australia, the UK
(including exports) and the rest of Europe.
Progress by BAT in Australia, Malaysia and
Singapore and continuing pressure
in Canada and Germany could make it difficult for
Rothmans to sustain the
improvement which has been achieved over the past
eighteen months.
RS/:)JS
20 t~ February 1992
(-n
CD
Co
r\J
BATCo document for Province of British Columbia 25
October 1999