British American Tobacco Malaysia - BAT Malaysia Delivers a Resilient FY2025, Underpinned by Disciplined Execution and Strong Cash Generation

• BAT Malaysia closed its Q4 FY2025 on a resilient footing, underpinned by disciplined execution, portfolio strength and continued focus on operational efficiency.
• For the quarter under review, the Group recorded a revenue of RM948 million, a significant increase from the RM653 million registered in the same period last year, primarily driven by higher shipment volumes and retail price adjustment.
• This increase, combined with ongoing cost optimisation initiatives, contributed to a profit from operations of RM174 million for the quarter compared with RM77 million from the same period last year.
• The Board of Directors has declared a fourth interim ordinary dividend of 39.0 sen per ordinary share amounting to RM111 million, payable on 10 April 2026 to shareholders.

Kuala Lumpur, 9 February 2026 – British American Tobacco (Malaysia) Berhad (BAT Malaysia or the Group) today announced its financial results for the fourth quarter ended 31 December 2025.

The Group closed its 2025 financial year with a revenue of RM2.2 billion, reflecting the evolving regulatory landscape and transition during the year.

Operating expenses for the year declined by 16%, driven by cost optimisation efforts and lower Vuse-related costs following the transition, partially offset by higher regulatory implementation expenses. This proactive cost management helped cushion the impact of lower revenue and volume on the Group's overall performance, resulting in a profit from operations of RM304 million compared with RM279 million registered a year ago.

The legal combustible segment recorded a 1.4% decline in volume for the year despite a 3% improvement in illicit incidence, with tobacco black market share easing from 57.2% to 54.4%. The gains from reduced illicit trade were insufficient to counter ongoing structural pressures, as the legal combustible segment continued to be affected by a sustained consumer shift toward reduced-risk products. This trend, compounded by phased implementations of Public Health Act, contributed to a 1.1% decline in the Group’s overall market share.

Nedal Salem, Managing Director of BAT Malaysia, said, “Our FY2025 performance reflects the resilience of our business in a year marked by market transition. By remaining focused on our core combustible portfolio and maintaining operational discipline, we delivered a solid financial outcome while strengthening the fundamentals for sustainable long-term value creation.

Strategic decisions taken during the year, including the transition out of Vuse and the acceleration of cost optimisation initiatives, were critical in sharpening our focus, strengthening cash generation and ensuring the business remains agile and resilient in a rapidly evolving regulatory environment.

The tobacco black market remains the single largest structural barrier to a sustainable legal industry and to the Government’s tax revenue recovery. With illicit incidence still accounting for 54.4% of total consumption, sustained and intensified enforcement is essential.

We stand ready to continue working closely with enforcement agencies and policymakers to support stronger action that can unlock the legal market’s potential and deliver long-term benefits for Malaysia.

The recent excise duty increase, effective 1 November 2025, has widened the price gap between legal and illegal tobacco products, further incentivising the tobacco black market, which remains a critical national issue.

The Group remains supportive of the Government’s efforts to combat the tobacco black market and will continue working in close partnership with enforcement agencies to strengthen market integrity. The record enforcement achievements in 2025 underscore the impact of coordinated action. Looking ahead, sustained and intensified enforcement, alongside the accelerated rollout of the digital tax stamp programme, will be critical in reclaiming domestic legal market volumes, safeguarding tax revenue and building a more regulated and sustainable industry ecosystem.

Amid this evolving environment, the Group remains resilient and focused on its strategic priorities, underpinned by market leadership in the premium segment through Dunhill, disciplined execution, and a commitment to operational excellence. The Group will continue to drive sustainable growth and deliver long-term value for shareholders and stakeholders,” Nedal concluded.