NOW LIVE: A Never Before Seen Interview with Sports Legend Michael Jordan

Cigar Industry

Cigar Sales Decrease at Scandinavian Tobacco Group

Mar 9, 2018 | By David Savona
Cigar Sales Decrease at Scandinavian Tobacco Group

Cigar sales—both handmade and machine-made—were down in 2017 at Scandinavian Tobacco Group, the parent of General Cigar Co., maker of Macanudo, La Gloria Cubana and a host of other cigars.

“2017 was a difficult year for the group,” wrote STG chairman Nigel Northridge in the company’s annual report. Net sales were down 4.2 percent, to 6.5 billion Danish kroner ($1.1 billion) and gross profit was down 4 percent, to 3.1 billion kroner ($513 million).

Machine-made cigar sales, the company’s largest business segment, fell by nearly 4 percent, to 2.5 billion kroner ($413 million). Sales of handmade cigars were down considerably more, dropping 7 percent, from 2.1 billion kroner ($347 million) to 1.9 billion ($318 million). It was the first time in more than 10 years, said STG, that its handmade cigar sales went down.

Machine-made cigars account for 39 percent of STG sales, and 41 percent of the company’s gross profits. Handmade cigars account for 30 percent of sales, and just over one-quarter of company profits.

In the U.S. market, the world’s largest, STG sold more than 300 million cigars, a volume drop of 1.8 percent. The poor performance was blamed on the company’s massive cigar retail company, Cigars International. Creating a new IT strategy at the online retailer early in the year went awry, causing problems that impacted sales and profits. STG said the performance of Cigars International improved “quarter by quarter,” and that the company now has “a fully scalable and well-functioning IT system.”

In January, STG announced it was acquiring another major online cigar retailer, Tampa, Florida’s Thompson and Co.

STG also makes pipe tobacco and fine cut tobacco, segments that were also down in sales.

STG brands include Macanudo and CAO, the non-Cuban versions of Cohiba, La Gloria Cubana, Punch, Partagas and Hoyo de Monterrey; machine-made cigar brands such as Café Crème and Henri Wintermans; and Captain Black and Borkum Riff pipe tobaccos.

General Cigar Co.

More in Cigar Industry

See all
Nat Sherman International Closing

Nat Sherman International Closing

Ninety years after it opened its doors for the first time, Nat Sherman is closing down. The company …

Aug 3, 2020
2020 Cigar Retailer Survey: The Hottest Cigar Brands In America

2020 Cigar Retailer Survey: The Hottest Cigar Brands In America

In a cigar world turned upside down by a pandemic, some things remain constant. Consumers continue to …

Jul 27, 2020
2020 Cigar Retailer Survey: How Covid-19 Has Impacted America’s Cigar Retailers

2020 Cigar Retailer Survey: How Covid-19 Has Impacted America’s Cigar Retailers

The Coronavirus pandemic has hurt many American cigar retailers, closing some cigar shops, forcing …

Jul 27, 2020
2020 Cigar Retailer Survey: Toros Supplant Robustos As Best-Selling Size

2020 Cigar Retailer Survey: Toros Supplant Robustos As Best-Selling Size

The cigar world was long dominated by the robusto, the short, plump size that has been the most …

Jul 27, 2020
Cigar Factories in Honduras To Remain Open

Cigar Factories in Honduras To Remain Open

Despite certain areas of Honduras returning to lockdown status due to Coronavirus, cigar operations …

Jul 21, 2020
ITS Hub to Replace InterTabac Trade Show This Year in Dortmund

ITS Hub to Replace InterTabac Trade Show This Year in Dortmund

Messe Dortmund has rescheduled the Intertabac cigar and tobacco convention as the ITS Hub, a hybrid …

Jul 16, 2020