Tobacco Manufacturer Benefit From Development of Competitive Brands

Source from:  Xuchang City 07/12/2005

Xuchang General Cigarette Factory in central China's Henan Province, which is one of the 36 key Chinese tobacco manufacturers designated by the State Tobacco Monopoly Administration (STMA), has benefited greatly from the development of competitive brands over the past year. In 2004, Xuchang General Cigarette Factory stepped up efforts to reform the structure of its existing cigarette brands, giving rise to the development of a famous brand and a big brand - the Dihao brand and the Golden Xuchang brand. The output of Dihao increased to nearly 60,000 cases (nearly 3 billion cigarettes) in 2004 from the level of 40,000 cases (2 billion cigarettes) in 2003, up 45.3 percent. Dihao has been included into the list of famous and high quality cigarette brands whose sales are closely followed by the STMA. In the first half of 2005, Xuchang General Cigarette Factory realized steady growth of economic efficiency while its cigarette production and marketing were on a par with those of the same period of 2004. In the first six months, it earned 2.41 billion yuan (290 million U.S. dollars) in sales income, including 1.392 billion yuan (167.7 million U.S. dollars) in taxes and profits, with the amount of profits alone amounting to 164 million yuan (19.75 million U.S. dollars). Consequently, Xuchang General Cigarette Factory ranked the first among manufacturing enterprises in Henan Province in terms of the amount of taxes and profits generated in the first half of 2005. Xuchang General Cigarette Factory is one of the three big tobacco manufacturing enterprise groups reincorporated in Henan in a structural reform of the tobacco industry of Henan in 2003, with the other two being Xinzheng Tobacco Group and Zhengzhou General Cigarette Factory. It was reincorporated on the basis of merger of the former Xuchang, Nanyang and Zhumadian Cigarette Factories. Presently, Xuchang General Cigarette Factory has an annual cigarette production capacity of 1.07 million cases (53.5 billion cigarettes) and 4.3 billion yuan (518 million U.S. dollars) in total assets, ranking the 16th place among all the tobacco manufacturing enterprises in China. Enditem