Sampoerna Builds Two Tobacco Factories

Source from:  Tobacco World 07/13/2012

Cigarette maker PT Hanjaya Mandala Sampoerna Tbk, controlled by Philip Morris International, has officially opened two of home-made cigarette factories in Probolinggo and Lumajang, East Java, on Wednesday as part of its expansion plans. Head of Sampoerna in the hands and roll production, Marcus Hosea, said that two new plant will produce home-made clove cigarettes, to meet the constant asking for kretek in Indonesia. "There are a lot of tobacco farmers in Probolinggo and Lumajang. Thus, the construction of new plants here is the right decision for us," he said, adding that the two self-made cigarette factories will use the 8400 workers in Probolinggo and Lumajang. Although the machine rolled clove cigarettes and clove cigarettes control 75% of the cigarette market, the demand for home-made cigarettes remains high, said Marcus. With the opening of two factories, Sampoerna currently operates eight plants in East Java – in Lumajang, Malang, Pasuruan, Probolinggo and Surabaya. Of the eight plants, only two are located in Pasuruan and Surabaya, to make the machine rolled clove cigarettes. New plants in Probolinggo and Lumajang work 4600 workers and 3800, respectively. The number of workers at the plant Probolinggo is expected to increase to 5200 in the near future. According to Marcus, 74% of employees in Probolinggo work as cigarette rollers and each of them can produce up to 410 cigarettes a day. He said that Sampoerna is also working with 38 small companies for the production of home-made cigarettes in Central Java, East Java, Yogyakarta and West Java. Head of East Java Agriculture and Plantation Office, Mohamad Samsul Arifien, said the total production of tobacco province reached 100,000 tons per year. "Probolinggo contribution to 10 percent of total production," he added. Mochammad said that every year 65,000 tons of tobacco was distributed among large firm’s cigarettes in East Java, and the rest was allocated to 650 small companies. Last year, Sampoerna has a net profit of Rp 8.06 trillion, up 25.7% over the previous year. As one of the country’s largest cigarette producers, Sampoerna produced 91.7 billion cigarettes in 2011, a 16.4 increase from 2010. The total volume of sales also increased by 19 percent to Rp 31.96 trillion in 2011 from the figures recorded a year earlier. Currently Sampoerna said it controlled nearly 30 percent of the domestic cigarette market. (TAS) Enditem