Zoom in

Zoom in

Zoom in

“PLEASING AND SURPRISING OUR CONSUMERS HAVE ALWAYS BEEN OUR GOALS AND WE HAVE ALSO DONE SO THIS YEAR”, LUIS SANCHEZ-HARGUINDEY AND INOCENTE NUÑEZ, CO-PRESIDENTS OF HABANOS, S.A., SAID DURING AN EXCLUSIVE INTERVIEW WITH THE EXCELENCIAS GROUP

What have been the main achievements for Habanos, S.A. during 2016?
LSH: 2016 has been an intense and challenging year, with several and original initiatives, and the outcome has been very positive. Undoubtedly, our utmost achievement is to have our international sales growing on an annual basis, in a steady way, by means of a strategy of ours aimed at offering Habano aficionados unrivalled and innovative proposals and experiences. The main efforts in 2016 were focused on the Cohiba brand and its 50th anniversary. It is our most exclusive brand and it deserved all our attention in terms of new and amazing products, communication and the activation of the brand worldwide.
IN: In order to mark the 50th anniversary of Cohiba, we put out two exclusive special editions, one of which is likely to be the most luxurious and special premium cigar ever put out: “Cohiba 50 Aniversario”. The first ring gauge 60 in the history of Habanos (60 x 178 mm), presented in an exclusive humidor with Cuban tobacco leaves covered in 24-karat gold leaf, and made in Paris by Elie Bleu. Only 50 humidors were produced, carrying 50 units each, with a recommended retail price of over 200,000 euros each. Cohiba Majestuosos 1966 was the second exclusive launch, a retro design humidor with a new vitola (58 x 150 mm) in an output of just 1,966 units. Last but not least, Cohiba Medio Siglo was rolled out within Línea 1492, in a trendy and shortened format. We also launched an exclusive product for Duty Free and Travel Retail, a travel humidor named Cohiba Selección 50 Aniversario, presented back in October in Cannes, during the TFWA show.
LSH: These launches were complemented by a significant communication effort carried out by Habanos, S.A. and its exclusive distributors throughout the year. It kicked off with the 18th edition of the Habano Festival and continued with nearly two dozen local events, especially the “Habanos Day” dedicated to the Cohiba brand and held in markets around the world. Both Habanos, S.A. and its distributors worked side by side and strengthened Cohiba’s image as the leading brand on the face of the earth.
IN: As for new products, there were several new elements last year, both in the regular portfolio and in different specialties. We put out Hoyo de Monterrey Reserva 2012, in the Epicure No. 2 vitola; H. Upmann Magnum 54, and three Ediciones Limitadas: Montecristo Dantés, Trinidad Topes and Romeo y Julieta Capuletos, which also had a very special rollout at world level in Verona, Italy, back in September. Moreover, nearly twenty Ediciones Regionales were launched in markets around the globe. All in all, we clung to our commitment of giving aficionados what they look for, by means of a far-reaching plan of launches with a significant number of brands and a wide array of special productions.

How about the drawbacks faced in 2016?
IN: Just as every year, we dealt with tough regulatory situations that inevitably affect us, along with the economic or politic instability in some markets. As for the regulation with the highest impact in 2016, I can mention the implementation in the European Union of the new European Tobacco Products Directive (EUTPD2), which is demanding Habanos, S.A. and our European distributors to adopt it in as soon as possible. We believe that it has been successfully done and our products presently meet the new Directive and can be marketed across the EU. On the other hand, we must remember that we have an agricultural product and, as such, it faces its own difficulties that mostly depend on the elements. Their management, depending on the circumstances, could be very complex. Anyway, Habanos S.A. works with TABACUBA to minimize the possible impact of these external factors.

Let’s talk about the Habanos Academy and its work over the past year
LSH: The Habanos Academy plays a leading role in the development and successful spreading of the Habano culture around the planet. Professionals from every nook and cranny are trained by means of the Academy’s programs, so they can later advise, recommend and share the passion for Habanos with the end users, the consumers. In the same breath, the Habanos Academy has reached out to nearly 30 distributors and 90 markets, and it enhanced its impact and presence over the past year. Over 8,000 people passed the Junior course and some 3,000 took the Senior one. This is the base for specialized sales outlets to grow quantitatively with the certainty to provide the service we need. The figure of Habanos Specialists has gone up by 5 percent, with over 870 sale outlets around the globe; there are more Habanos Points and over 1,900 retailers. Finally, our La Casa del Habano franchise, which is our top-tier retail store, is present on the five continents with 144 establishments. The same happens with Cohiba Atmosphere, since we presently manage 10 properties in 8 countries.

Which are going to be the main new products in this Festival edition?
IN: Pleasing and surprising our consumers have always been our goals, and we have also done so in 2016. Such brands as Montecristo, H. Upmann and Quai D’Orsay are set to play the leading role in the 19th Habano Festival, with outstanding new elements in their portfolios.
Montecristo introduces a new line of products in its portfolio: Línea 1935, which was named after the year when the legendary brand was founded, and it will become Montecristo’s most premium proposal. It comes out with three vitolas, two of them are new, and different presentations.
H. Upmann introduces Gran Reserva Cosecha 2011, in its iconic Sir Winston vitola, made of leaves that have gone through a long and careful five-year aging process. The exclusive production only includes 5,000 numbered boxes.
LSH: Moreover, Quai D’Orsay displays new design and two new vitolas (No. 50 and No. 54), which join Coronas Claro, and it will be distributed in Habanos, S.A.’s main international markets.
Beyond these launchings, a new Habano is scheduled to be introduced in Romeo y Julieta’s regular portfolio, two exclusive vitolas will be launched for La Casa del Habano as part of H. Upmann and Trinidad brands, and we are going to put out the 2017 Ediciones Limitadas in Cohiba, Partagás and Punch brands.

How about Habanos, S.A.’s growth outlooks in new markets?
LSH: In our strong markets, the aim is set on holding the market share and maximizing the profitability of our business, especially now that some regions, like Europe, have implemented severe regulatory formulas that affect the introduction of our products and the exposure of the brands. In Habanos, S.A. we have spent years working on the development of the so-called emerging markets, by spreading the Habano culture among customers and consumers and, especially, trying to grow in terms of sales. The results have been good so far. We’re talking about markets in Eastern Europe, the Middle East, Latin America and the Asia-Pacific region.

How does Habanos, S.A. see the future possibilities of prying into the U.S. market?
IN: The situation hasn’t changed over the past year. As we always say, we’re not worried about it and we don’t like to speculate on this matter. When this market is effectively opened to our products, we will undoubtedly have a great opportunity there. The U.S. market represents nearly two thirds of the world market for premium cigars. In October 2016, we welcomed the relaxation in the number of cigars that U.S. citizens can now legally introduce in the country (up to 100 units per person as hand luggage and for personal consumption), which is positive for U.S. consumers to puff on our products. The possibility of marketing our magnificent Habanos there actually excites us, but we are presently focused on the markets where we are allowed to operate.

There’s been some concern in the realm of premium cigars on the production of Cuban tobacco over the past years. Can you juggle your hats in meeting the growing demand for Habanos in the world market and the opening of new markets?
IN: Yes, we strongly believe that we can fulfill this demand. The industry has been working for a long time to meet that demand, so a strategic plan was implemented with a series of specific actions, such as the increase of the tobacco growing area by preparing new zones and recovering some land patches. We are also working on the development of new plantations in the central region of the country and we have invested on new agricultural technology. These actions are complemented by a development program that provides coverage all the way to the final manufacturing process, with the training of new cigar rollers and the expansion of factories.
Year in year out, the Habanos strengthen their leadership as premium cigars at international level.

It would be interesting for our readers to have a rundown of your Habano-related careers. Can you mention your personal preferences as smokers? Which brand and vitola do you prefer? What do you like to pair them with?
LSH: Habanos have accompanied me throughout my life because my father was a big enthusiast of these cigars, so I was used to seeing him enjoying a Montecristo No. 4 or Partagás 8-9-8, his favorite Habano.
My closest contact with Habanos took place in 1998, when I developed my professional career in Cuba. It definitely gained momentum in 2001 when I joined Habanos, S.A. I soon became a Habano aficionado, so after having taken several positions within the company, it is an honor and a tremendous pleasure for me to contribute to the strengthening of our business’ world leadership from my position as co-president of Habanos, S.A.
The consumption preferences among Habano aficionados have evolved with time, mainly targeting formats of thicker ring gauge, and I follow this trend. So, although my sentimental connection leads me to enjoying Partagas 8-9-8, my day could get going with a cup of coffee accompanied by a Petit Robusto, such as Romeo y Julieta’s Petit Churchills. Along the day, I’d continue with thicker formats, like Trinidad Vigía, Pirámide de Montecristo No. 2 or Cohiba Siglo VI, which is one of my favorite cigars.
As for special occasions, enjoying a Cohiba Behike 54, paired with a good Cuban rum and accompanied by friends would be the best way to call it a day.
IN: My life in the Cuban tobacco realm began when I studied at the “Tranquilino Sandalio de Noda” Tobacco Technical Institute, where I got my degree. I directly went to work in the agricultural activity in 1974, growing tobacco, and I’ve been linked to this crop ever since. I worked in several areas and positions until I was appointed co-president of Habanos S.A. That’s why, more than a job, Habanos are a part of me I can’t let go. They are a passion I also express as a smoker, since nothing gives me more pleasure than calmly tasting a fine Cohiba Lancero, accompanied by a glass of exquisite Cuban aged rum.