Jakarta May 18, 2020 – PT HM Sampoerna Tbk. (“Sampoerna” or “the Company”/IDX: HMSP) announced its full year 2019 and first quarter 2020 results today.
For the full-year of 2019, Sampoerna reported net revenues of Rp 106.1 trillion and net profit of Rp 13.7 trillion. The profitability grew supported by the cost optimizations leading to improved Gross Profit Margin. The Company maintained its leadership position in Indonesia with 32.2% market share and 98.5 billion units in annual sales volume. Volume was down by 2.9% mainly due to Sampoerna A which was under pressure from wider than historical price gap with the Low priced segment. Sampoerna commands a 29.6% share of market in the machine-made kretek segment, 57.2% of the white cigarette segment and 36.3% share in the hand-rolled kretek segment. The Company declared a dividend of Rp 119.8 per share for 2019.
Sampoerna also reported that in the first quarter of 2020 the net income increased by 1.1% to Rp3.32 trillion compared to the previous year, driven mainly by favorable operating cost. The Company’s revenue decreased slightly by 0.5% to Rp 23.7 trillion due to lower cigarette volume partially offset by pricing increase.
In the first quarter of 2020 Sampoerna’s market share and volume declined to 30.3% and 20.4 billion units, driven mainly due to Dji Sam Soe Magnum Mild, reflecting adult smoker down-trading to superlow-price brands due to widened price gaps; partly offset by share growth in Sampoerna A, reflecting reduced price gaps with directly competitive mid and low-price brands.
Mr. Mindaugas Trumpaitis, President Director of Sampoerna stated that “2020 will be another challenging year for the tobacco industry as the economy is hit by COVID-19 pandemic. In addition to that, there is an impact to our brands due to excessive weighted excise increase of 24 percent and weighted minimum banderole price increase of 46 percent.”
The Company, however, appreciates some relaxations given by the Ministry of Finance, including the extension of excise payment from 60 days to 90 days since the time of order. "The ease indeed gives us more capability to allocate and manage some funds to further enhance health and safety protocols in our manufacturing sites," said Mr. Trumpaitis.
Since the onset of Coronavirus Disease 2019 (COVID-19) pandemic, the Company has undertaken a number of business continuity measures in order to preserve availability of products to our customers and adult consumers.
“With uncertainty about the timing of a return to normal, the Company continues to apply Good Manufacturing Practices, we have also implemented a strict safety, health and sanitation protocols as recommended by the government, and above and beyond not only in all factories, but also in warehouses and supply chain. This to ensure that the business continues to operate as normally as possible while maintaining the highest quality and brand integrity of our products,” said Mr. Trumpaitis
Despite the Company is facing exceptional circumstances, Mr. Trumpaitis ensured that Sampoerna is committed in ensuring economic stability of all employees, and not to carry out any termination of employment during this pandemic period and provide full salaries, including their festive bonus.
Seeing a significant impact Coronavirus brings to business, Mr. Trumpaitis hopes that government continues to support tobacco industry which has been a source of income for about six million people.
Commitment to support actions against the pandemic The Company has been actively working against this pandemic since its outbreak in March, with ongoing and planned initiatives that involves monetary and in-kind donations to support employees and business partners, the communities in which it operates as well as national and local efforts to combat the virus.
In addition, Sampoerna’s continued commitment to support Micro Small Medium Enterprises (MSMEs) in Indonesia through 120,000 traditional retailers in Sampoerna Retail Community (SRC) by assisting them to improve their capabilities to sustain and navigate the store’s performance during these challenging times. That includes education on health and safety protocols, providing distribution of mask and hand sanitizer, as well as cashier partition to ensure physical distance with consumers. Furthermore, we have implemented a digital ecosystem application “AYO SRC” for their electronic purchase activities.
About PT HM Sampoerna Tbk. (Sampoerna) Established in 1913, Sampoerna – an affiliate of Philip Morris International Inc. – is the leading Indonesian tobacco company, focusing primarily on manufacturing and trading of clove cigarettes. Sampoerna produces some of the best-known kretek (clove) cigarette brand families such as Sampoerna A, Dji Sam Soe the legendary “King of Kretek”, Sampoerna U and Sampoerna Kretek. Sampoerna also distributes the Marlboro cigarette brand throughout Indonesia, through a long-term distribution agreement with PT Philip Morris Indonesia.
Sampoerna operates six production facilities located in Surabaya, Pasuruan, Probolinggo, Malang, and Karawang. Sampoerna partners with 38 Third Party Operators in Java, employing – directly and indirectly -- a total of approximately 60,000 employees, mostly in the production of hand-rolled clove cigarettes. Sampoerna distributes its products through 112 sales and distribution area offices across Indonesia. Sampoerna is one of the largest issuers by market capitalization on the Indonesian Stock Exchange, where it trades under the ticker symbol “HMSP.”
For further information:
Media Contact: Nazrya Octora
External Communications Manager
PT HM Sampoerna Tbk.