Net profit of Sampoerna grew 28 percent to IDR8.1 trillion ($501.11 million) in 2023. With shipments of 83.4 billion cigarettes, the company remained the undisputed leader in Indonesia, claiming a market share of 28.6 percent.
“2023 marked a year of return to robust profitable growth, with Sampoerna reaching significant milestones for advancing scientifically substantiated smoke-free products, increasing its investment and employment in Indonesia, and generating strong multiplier effects, in line with the country’s priority to enhance down-streaming.” said Sampoerna President Director Vassilis Gkatzelis in a statement.
Sampoerna’s performance was driven in part by the recovery of the hand-rolled kretek cigarette (SKT) segment in Indonesia. After declining for many years, its share rose from 17 percent of overall tobacco sales in 2019 to 28 percent in 2023, boosted by the government’s favorable tax treatment of this labor-intensive sector.
In early 2024, Sampoerna added SKT production facilities and third-party operators, creating employment for tens of thousands of new workers.
The company has also been developing its smoke-free portfolio in Indonesia. In 2023, the company inaugurated a dedicated factory in Karawang, near Jakarta, which supplies both the domestic market and customers in the Asia Pacific region.
In the Jakarta urban area, the company’s IQOS tobacco-heating product reached a market share of 3.5 percent in the fourth quarter of 2023, an increase of 2 points from the fourth quarter of 2022.
To date, Sampoerna has invested $300 million in smoke-free products in Indonesia.
Gkatzelis will leave Sampoerna in May and join Philip Morris International’s executive leadership team as president of the East Asia, Australia and PMI duty-free region.
His successor at Sampoerna is Ivan Cahyadi.