BAT Kenya is paying me more than it earns, and I should probably be worried. But I’m not. Because when someone hands you KES 70 per share in dividends, you don’t start interrogating the math, you start smiling. At KES 538 a share, that’s a 13% yield. Thirteen percent. The kind of number that makes analysts twitch, bond traders call other bond traders to complain how it’s wrong…you know…typical finance guys and me? Well, me, I just laugh.
The accountants will mutter about the payout ratio, 133%, which is absurd. It’s reckless. Maybe irresponsible. It’s like a drunk uncle at Christmas handing out cash he doesn’t have. But I’m the one being handed the cash, and I’m not complaining. Because sometimes happiness beats math.
You see, I have been burned before, actually most times! And maybe that’s why this feels so sweet. Because I’ve always been on the wrong side of the market. Every time I invest, it dips. Every time I buy, the chart turns against me. My blood pressure climbs with every red candle, every cruel reminder that the market doesn’t care about my plans. I’ve cursed it, I’ve raged at it, I’ve written angry notes about its indifference.
So when the market finally rewards me, I can’t help but write. I can’t help but praise it. It feels like that absent parent who never showed up for birthdays, never came to school plays, suddenly appearing at graduation because they heard the child is working now. Too late, too awkward, but still, it’s something. And you take it. Because you’ve been waiting for it all along.
BAT’s Math
And here’s the kicker: BAT isn’t exactly swimming in calm waters. Net revenue fell 10% thanks to illicit trade eating up nearly half the domestic market. Forty-five percent of cigarettes sold are illegal, depriving the government of billions in taxes. You are basically fighting a shadow economy with one hand while tossing cash to shareholders with the other. Yet somehow, profit after tax still rose 18% to KES 5.246 billion, exports held steady, and even oral nicotine pouches made a comeback. Then they paid me KES 7 billion in dividends, more than they earned.
The market is moody, unpredictable, irrational. It punishes you for no reason, then rewards you with irrational generosity. BAT’s dividend feels like the market’s love letter written in red ink. Analysts frown, regulators raise eyebrows, but KPMG still stamped the accounts with an unqualified opinion as if to say, “Yes, this circus is technically fine.” And I smile. Because the market’s mood swings are my fuel: anger when it dips, joy when it pays, irony when it makes no sense.
And I know, deep down, that this isn’t sustainable. Companies aren’t supposed to pay more than they earn. But here I am, living in the absurdity, enjoying the recklessness, cashing the check. Because the good thing about investing is this: if things dip tomorrow, I can always sell my shares…after pocketing my dividends.
That’s the dream, isn’t it? To live off dividends, sipping coffee while the portfolio pays for life. To write angry op-eds about payout ratios while secretly smiling at the cash in my account. BAT is paying me more than it earns, and I should probably be worried. But I’m not. Because in the theater of the market, dividends beat earnings, happiness beats math, and sometimes the best strategy is simply to cash the check and keep writing.
