PETALING JAYA: British American Tobacco (Malaysia) Bhd (BAT Malaysia) navigated a challenging operating environment in FY25, marked by tighter vapour regulations, higher tobacco excise duties, the implementation of the retail display ban and updated pictorial health warnings.
Despite the headwinds, the group delivered a resilient performance driven by rigorous cost optimisation and sharpened focus on its core combustible business.
The group’s profit from operations increased by 9% in FY25 compared to the previous financial year, reflecting disciplined cost management and a continued focus on its combustible portfolio.
Revenue was recorded at RM2.18 billion, a 5% reduction from the previous year, driven by regulatory developments, high illicit incidence, and affordability pressures.
Despite the pressures, net profit grew by 11% year-on-year, underpinned by disciplined cost management.
Further, the group continued to deliver sustainable value to shareholders, maintaining a robust dividend payout of 90% of total earnings.
For FY25, the dividend was increased to 63.5 sen, up from 59 sen in the previous year.
BAT Malaysia noted a marginal decline in the tobacco black market from 55% in 2024 to 54.4% in 2025, attributable to enforcement efforts.
BAT Malaysia managing director Nedal Salem said the group’s unwavering focus remains on its key brands, with Dunhill leading Malaysia’s premium category, and Peter Stuyvesant and Rothmans delivering across other important segments.
“We are sharpening our brand strategies to invest in products with the greatest potential for long-term, sustainable returns, ensuring BAT Malaysia remains competitive, adaptable and a consistent creator of shareholder value,” he said after the group’s 65th annual general meeting today.
The group also continues to face external pressures, with the tobacco black market remaining the industry’s single largest challenge, accounting for almost 55% of total market volume.
“Enforcement agencies have made notable progress in tackling the tobacco black market, resulting in a marginal decline in illegal volumes.
“While these achievements demonstrate the impact of coordinated action, more needs to be done from a strategic perspective to fully restore market integrity.
The group stands ready to work with authorities and policymakers to strengthen the legal market and safeguard tax revenue for the country,” Nedal said.
Looking ahead, he said BAT Malaysia will continue to focus on disciplined execution, stronger brand prioritisation and enhanced route-to-market capabilities, which gives confidence in the group’s ability to navigate ongoing challenges and deliver sustainable value for shareholders.
