The Eastern Company, Egypt’s leading local tobacco company, has seen remarkable success over the years, with its revenues surging by 54 percent in the second quarter of the fiscal year 2023/2024.
During the first two quarters of the financial year 2023/2024, the Eastern Company achieved revenues of EGP 7.9 billion (USD 163.8 million) from 1 July to 31 December 2023. The total profit for this period reached EGP 2.7 billion.
In the second quarter of the fiscal year, the Eastern Company recorded revenues of 4.8 billion Egyptian pounds, recording a 54 percent increase. This was a significant increase from EGP 3.1 billion (USD 64.2 million) in the previous quarter. The total profit reached EGP 1.8 billion (USD 37.3 million) compared to EGP 975 million (USD 20.2 million), with a growth rate of 83 percent.
To navigate the economic challenges and inflation, the Eastern Company raised cigarette prices twice in 2024. The latest price increase, implemented on 14 April, saw the prices of several cigarette products rise by up to EGP 5 (USD 0.1) per pack.
“Cigarette prices have been adjusted to address the significant increase in raw material prices in foreign currency, as well as the change in the official exchange rate of the pound against foreign currencies,” the CEO and Managing director of the Eastern Company, Hany Aman, stated.
Eastern Company is on a list of 35 other Egyptian companies arranged for partial or complete privatization by the government. In 2019, the company launched an initial public offering (IPO) of 4.5 percent of the company, where public and private investors can buy shares.
The Ministry of Finance has gained EGP 1.8 billion (USD 37.3 million) from the IPO, which will be added to the general treasury to finance the deficit in the general budget as part of the economic reform program adopted by the government.
By the end of 2023, 73.46 million shares of the state-owned company, marking only 3.3 percent of the company’s total capital, were bought by investors for EGP 2.05 billion (USD 42.5 million), according to the Egyptian Exchange (EGX).
By decree of Sultan Ahmed Fouad and capital of EGP 25,000 (USD 518), the Eastern Company was established in 1920 to counter foreign dominance in the Egyptian cigarette market. The company emerged as a key player in the Egyptian tobacco industry, earning a spot on Forbes’ list of ‘Egypt’s Top 50 Listed Companies 2023.’
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