`PT HM Sampoerna Tbk. (Sampoerna/IDX: HMSP) has solidified its position as the market leader in the national tobacco products industry (IHT) through a robust brand portfolio strategy, supporting the Company's performance and business sustainability. Based on the financial performance report for the first half of 2025, Sampoerna recorded 0.8 points increase in market share compared to the same period last year, reaching 31%. Meanwhile, sales volume decreased 1.5% to 39.3 billion cigarettes, due to the impact of the downtrading trend shifting from premium products to lower-priced products.
Regarding the Company's net profit, Sampoerna recorded a one-off tax charge in the second quarter of 2025 covering the prior fiscal years, as stipulated in the Statement of Financial Accounting Standards (PSAK). Excluding this one-time effect, net profit was broadly flat compared to the same period last year. This non-recurring item resulted Company's net profit decline by 36% to IDR 2.1 trillion compared to the first semester of 2024; however it did not impact the Company's operational performance.
"We are proud that Sampoerna has been able to maintain its market leadership in national tobacco industry. We also truly appreciate the government's commitment to maintaining a conducive business climate, including its decision not to increase tobacco excise in 2025. We hope the government will consider continuing the policy to support economic growth objectives, maintain employment and government revenue, and ensure the sustainability of legal tobacco manufacturers," Sampoerna President Director Ivan Cahyadi said.
Over the past five years, the dynamics and performance of the tobacco industry has continued to be affected by challenges triggered by significant increases in excise tax rates, amid declining purchasing power among adult smokers. The decline began during the COVID pandemic and was then accompanied by economic pressures exacerbated by the geopolitical situation. These conditions have led to the proliferation of illegal cigarettes in Indonesia, which has an immediate impact on legal businesses and reduces the potential for state revenue from excise and taxes as a whole.
In response, Ivan said: "We greatly appreciate the decisive action taken by the government, particularly the Directorate General of Customs and Excise (DJBC), which has intensified and strengthened its efforts to eradicate illegal cigarettes, both through education and enforcement on the ground, with the support of both law enforcement agencies and local governments to secure state revenue. This commitment is crucial for the tobacco industry, and we fully support these collective efforts."
As the tobacco industry continues to weather challenges and pressures, Sampoerna remains committed to supporting the national economy through sustainable investments by strengthening the industry ecosystem through partnerships, as well as promoting a broader people-centered economy. This includes additional 5 partnerships with local entrepreneurs/regional cooperatives in 2024, bringing the total number to 43 third party operators (TPO) in producing hand-rolled cigarettes (SKT) across districts/cities on the island of Java, partnering with over 19,500 tobacco and clove farmers by providing purchase guarantees, partnering with 1,700 local suppliers, and also collaborating with 1.5 million retail outlets across Indonesia.
“In addition to strengthening partnerships and promoting a people-centered economy, Sampoerna also always invests and innovates sustainably, both in terms of business activities and product portfolio. In 2023, we inaugurated the first advanced laboratory and innovative smoke-free tobacco product production facility in Southeast Asia with an investment of over USD 330 million. In 2024, we also added production facilities in Tegal and Blitar. Overall, Sampoerna employs 90,000 workers directly and indirectly, with the majority working in our SKT production portfolio. Additionally, Sampoerna serves as the export hub for Philip Morris International (PMI) to over 30 export destinations, including both cigarette products and heated tobacco products,” Ivan said.
Overall, Sampoerna's business and operational activities actively contribute to the regional and national economy. Looking forward, Ivan is optimistic that the government will consider policies to support the long-term sustainability of the tobacco industry, which is one of the key pillars for achieving 8% national economic growth. This further underscores the belief that synergy between the private sector and the government is key to building a foundation for strong and sustainable economic growth in Indonesia.
Pesta Rakyat untuk Indonesia 2025: A Genuine Commitment to Promote a People-Centered Economy
To commemorate the 80th Anniversary of Indonesia's Independence Day, which coincides with Sampoerna's 112th Anniversary in August, Sampoerna is hosting the “Pesta Rakyat untuk Indonesia 2025” on August 22–23, 2025, at Smesco Indonesia in Jakarta. This event serves as an annual collaborative platform to strengthen the people-centered economy through the development of high-quality and competitive human capital as the foundation for inclusive and sustainable economic growth.
Since 2007, Sampoerna has implemented two flagship programs in developing and fostering of MSMEs, namely the Sampoerna Entrepreneurship Training Center (SETC) and the Sampoerna Retail Community (SRC) under “Sampoerna for Indonesia” sustainability program. These two programs have benefited over 347,000 SME entrepreneurs, with 250,000 of them being traditional retailers spread across Indonesia. Sampoerna's support is provided in the form of training, mentoring, digitalization, as well as access to markets and financial services.
With the reinforcement of the SRC network, strengthened with store management capabilities and digitalization, opportunities for collaboration with various parties, including several State-Owned Enterprises (SOEs) with the aim of strengthening the people-centered economy, have become available. Plans are underway for Sampoerna, through SRC, to sign a memorandum of understanding at the “Pesta Rakyat untuk Indonesia 2025” event with the National Logistics Agency (Perum BULOG), PT Bank Rakyat Indonesia (Persero) Tbk., and PT Pos Indonesia (Persero). Through the collaboration, it is hoped that the Rumah Pangan Kita (RPK) network will be expanded to support national food security, enhance financial literacy and inclusion through digitalization, and expand the distribution of duty stamps and logistics services through SRC store network nationwide.
“Pesta Rakyat untuk Indonesia 2025” also aims to encourage and empower MSME entrepreneurs through various inspirational sessions and workshops with expert practitioners in their fields - as well as exhibitions of leading MSME products from various regions that reflect the extraordinary potential of Indonesia's human capital and people-centered economy. It is estimated that around 3,000 participants will actively participate in the two-day event.
Through the cross-sector collaboration, Sampoerna reaffirms its role in supporting the growth of MSMEs as the backbone of the national economy by realizing a shared commitment to building a more inclusive, competitive, and sustainable future for Indonesia's economy.