Following the successful completion of its nearly HUF 10 billion investment in November 2022, Continental Tobacco Group continues to implement its growth plans. Under the contract signed in early January, a leading player in the Hungarian tobacco industry has added 8,000 m2 of industrial space in the immediate vicinity of the company’s tobacco factory in Sátoraljaújhely, which has a history of more than 130 years. The group intends to use the acquired land to alleviate the shortage of warehouse capacity resulting from the expansion of its preparation capacity.
In recent years, Hungary’s only domestically owned tobacco factory, the Sátoraljaújhely tobacco factory owned by Continental Tobacco Group, has undergone significant development. After nearly two years of work, the company successfully completed a nearly HUF 10 billion investment last autumn to build a three-storey, modern preparation hall and modernise the entire production line.
In parallel with the expansion, the need to increase warehouse capacity has become increasingly important to enable the Group to effectively and efficiently exploit the production capacity of the new plant. The purchase of the 8 000 m2 industrial site next to the tobacco factory was made with this in mind.
As a result of the transaction, the industrial buildings on the site were also taken over by the Continental Tobacco Group. The obsolete buildings are to be replaced by a modern warehouse building, which will have the maximum ceiling height allowed by the regulations to make the best use of space. In order to further increase the Group’s competitiveness, the internal equipment will be based on state-of-the-art warehouse technology, which will also represent a further step forward for the company in terms of robotisation. Preparation of the plans for the new building and obtaining the necessary permits are expected to be completed this year, while construction work is expected to start in 2024.
The investment, which was completed last year, has resulted in an increase of around 25% in the capacity of the Sátoraljaújhely factory to produce tobacco cuttings. Csaba Füzi, CEO of Continental Tobacco, believes that the biggest challenge in 2023 will be to maximise this capacity, but there is significant demand on the international market, so there are good opportunities. The purchased land is seen as an important pillar of this effort, as it is essential that production and storage capacity go hand in hand.