The state-owned tobacco holding Bulgartabac is planning to invest BGN 28.5mn (EUR 14.6mn) in diversification and modernisation of production this year, according to the annual financial report of the holding presented to the local stock exchange. The target of the company is to keep its share on the domestic market and to expand export sales. Bulgartabac has reduced prices of several cigarette brands positioned in the low-profile segment by 15% as of end-January in efforts to counteract increasing competition from cheap imports. However, the holding retains the prices of its more expensive brands unchanged saying that their sales are not affected by import alternatives coming mainly from Romanian producers owned by BAT. Sales of Bulgartabac dropped about 4% to BGN 29.2mn last year, according to the non-consolidated financial statement. The net profit of the holding, however, more than tripled reaching BGN 37.5mn in 2006. The improved financial position was conditioned on income from financial investments. The holding has run several successful sell-outs for smaller units last year and plans several other auctions this year, including the cigarette makers in Plovdiv , Stara Zagora , and Sofia .