As authorities crack down on illicit imports:

CTC contributes more to Government

Ceylon Tobacco Company (CTC) contributed Rs. 11.4 billion to Government revenue during the first quarter of 2009, an increase of Rs. 539 million from the same period last year. The increase in Government revenue is attributed to excise-led price increases and a better brand mix.

Counterfeit and smuggled cigarettes have been on the rise in 2009 with over Rs. 500 million worth cigarettes being confiscated by the authorities during the period.

During the last three months over 165 raids have been carried out by the authorities with 36 million cigarettes (valued over Rs. 500 million) being confiscated.

The number of confiscated cigarettes during the first three months this year is equivalent to the total number netted in by authorities during entire 2008. The illegal products entering the country are known to be arriving from Far East Asia via the Middle Eastern shipping hub, to Sri Lanka. Authorities this year have ensured better enforcement securing better returns for the Government.

Profit after tax stood at Rs. 493 million reaping results of the company’s continuous productivity initiatives. Given the current volatility in the environment and higher tobacco leaf prices, the company has increased its efforts in delivering greater efficiency and drive productivity across the entire value chain to generate additional savings. These measures have continued to bear fruit and have now resulted in lower operating expenses in the first quarter.

The company however continued efforts in its current corporate social responsibility initiative, the Sustainable Agricultural Development Program (SADP).

Another 300 families have been recruited since December 2008, bringing the total to date to 3,858 families. The company has extended the SADP project to the Eastern Province in line with the Government’s Re-building the East program - Nagenahira Navodaya.

The SADP formula will be replicated in identified areas in the Eastern Province. This is expected to benefit 2,000 families, now re-located in the East of the country.