Strengthening our leading position in CIS+
Kevin Tomlinson

Regional President, CIS+

Note: CIS+ Region differs from CIS+ cluster by excluding Adriatic markets, Bulgaria, Moldova and Romania

Caution on Forward-Looking Statements
Today’s presentations contain forward-looking statements. These statements appear in a number of places in these presentations and include statements regarding the intent, belief, orcurrent and future expectations of our management with respect to our business, financial condition and results of operations. In some cases, you can identify forward-looking statements
by terms such as “may”, “will”, “should”, “would”, “expect”, “intend”, “project”, “plan”, “aim”, “seek”, “target”, “anticipate”, “believe”, “estimate”, “predict”, “potential” or the negative of theseterms or other similar terminology. These statements are not guarantees of future performance and are subject to various risks and uncertainties. Actual results, performance orachievements, or those of the industries in which we operate, may differ materially from any future results, performance or achievements expressed or implied by these forward-lookingstatements. In addition, these forward-looking statements are necessarily dependent upon assumptions, estimates and data that may be incorrect or imprecise and involve known andunknown risks and uncertainties. Forward-looking statements regarding operating results are particularly subject to a variety of assumptions, some or all of which may not be realized.

Risks, uncertainties or other factors that could cause actual results to differ materially from those expressed in any forward-looking statement include, without limitation:(1) decrease in demand for tobacco products in key markets;(2) restrictions on promoting, marketing, packaging, labeling and usage of tobacco products in markets in which we operate;(3) increases in excise, consumption or other taxes on tobacco products in markets in which we operate;(4) litigation around the world alleging adverse health and financial effects resulting from, or relating to, tobacco products ;(5) our ability to realize anticipated results of our acquisition or other similar investments;(6) competition in markets in which we operate or into which we seek to expand;(7) deterioration in economic conditions in areas that matter to us;(8) economic, regulatory and political changes, such as nationalization, terrorism, wars and civil unrest, in countries in which we operate;(9) fluctuations in foreign exchange rates and the costs of raw materials; and(10) catastrophes, including natural disasters.

© Copyright JT 2015

London – September 18, 2015

JT Investor Meeting2This presentation contains images or packages of our brands
in some slides. Those slides have been included exclusively
to illustrate JT Group’s strategy or performance to ourinvestors. They are not to be used for any other purpose.

© Copyright JT 2015

London – September 18, 2015

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A strong #1 in CIS+

A. Ernst(GM Russia)

P. Holloway(GM Caucasus)

D. Gilfillan(GM Kazakhstan & CAM)

London – September 18, 2015

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A dynamic region and strong contributor to JTI’s growth• 12 markets with a population of 282 million:• Armenia, Azerbaijan, Belarus, Georgia,Kazakhstan, Kyrgyzstan, Mongolia,Russia, Tajikistan, Turkmenistan,Uzbekistan and Ukraine• 53 million adult smokers(1)• Industry volume of 471 BnU in 2014
• Industry value of 30 $Bn in 2014
• Key contributor to the JTI’s top andbottom-line growth

CIS+ contribution to JTI 2014 results
CIS+
39%

• 6 factories• 7,200 employees© Copyright JT 2015

Total volumeLondon – September 18, 2015

Source: JTI estimates. (1) Excluding Central Asian Markets. Note: EBITA on a reported basis

CIS+
41%

GFB volumeCIS+
35%

EBITA
JT Investor Meeting

5Delivering solid profit increases
EBITA(Index, 2010=100)

2010© Copyright JT 2015

Note: EBITA on a reported basis•

Strong profit growth consistently delivered
over the last five years•

Industry retail value grew 86% since 2010•

Predictable and reasonable excise tax
increases providing solid pricing environment:•Affordability and illicit trade levels remainfavorable vs. more developed markets

2014
London – September 18, 2015

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JTI is the undisputed #1 tobacco player in CIS+
Share of market in CIS+, 2014
32.4%

JTI

#2

34.3%

JTI

#2

26.1%

#3
#4

Share of value in CIS+, 2014

#3

20.9%

#4

11.1%

28.5%
21.2%
8.7%

JTI holds the #1 SoM or SoV position in 6 markets,
while being strong #2 or #3 in the others© Copyright JT 2015

Source: JTI estimates

London – September 18, 2015

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Focused investment on GFBs driving
strong results

London – September 18, 2015

JT Investor Meeting8Strong leading position in the growing Mid-Price segment
JTI share of segment, 2014

Price segments development
Premium+

13.7%

14.0%

Mid-Price

24.5%

25.3%
62.4%

Value

61.7%

60.7%
25.0%
14.3%

2010
© Copyright JT 2015

Source: JTI estimates excluding Central Asian Markets

Premium+

2014
London – September 18, 2015

Mid-Price

Value
JT Investor Meeting9Constantly investing to strengthen GFB equity
Innovative and evolving portfolio

Brand extensions’ contribution (vol. %)2014
vs. 2010
26%+20ppt30%+27ppt19%

6%© Copyright JT 2015

Source: JTI estimates

London – September 18, 2015

+5ppt

+1ppt
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Continued GFB volume growth driven by Winston and LD
Industry volume(BnU)

GFB volume(BnU)

57210899471

31262010© Copyright JT 2015

Source: JTI estimates

2014
London – September 18, 2015

5664

2010

2014
JT Investor Meeting11Winston: The leading tobacco brand in CIS+
Winston share of market•#1 tobacco brand in CIS+ with market share of
13.5% in 2014, up 3.4ppt vs. 2010

•Holding a strong leading position in several
markets, namely Russia, Kyrgyzstan, Georgia,Belarus and Armenia•

Widening the brand appeal by continuously
evolving the portfolio with innovative andaffordable extensions

13.5%
10.1%

2010
© Copyright JT 2015

Source: JTI estimates

2014
London – September 18, 2015JT Investor Meeting

12Belarus: Strong GFB performance led by Winston and LD
GFB share of market

21.7%
19.2%

•Winston strengthened its market leading
position driven by the positive momentum of
the Core family as well as line extensions•LD doubled its share of market over the last
12 months, becoming the second GFB pillar

3.2%

GFB volume(BnU)

1.6%

1.9
13.6%

14.5%

1.7

1H 2014

1H 2015

1H 2014© Copyright JT 2015

London – September 18, 2015

Source: JTI estimates, Nielsen. Note: GFB SoM on a 6-month rolling average to June

1H 2015
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Ukraine: LD drives outstanding GFB growth momentum
GFB share of market•

Strong GFB performance driven by LD•

LD’s competitively layered portfolio attracts bothup-traders and down-traders. LD reached the #1
position in the market in June 2015

•Continued investment in Winston equity in
downtrading environment

21.2%
17.7%
6.9%

GFB volume(BnU)
7.2

9.9%
6.4

11.8%
4.2%
1H 2014© Copyright JT 2015

1H 2014

1H 2015
London – September 18, 2015

Source: JTI estimates, DCS. Note: GFB SoM on a 6-month rolling average to June

1H 2015
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Unit price increasing significantly
GFB share of market

Core revenue per thousand
(US$)

23.0

22.6%
17.4%

2010
© Copyright JT 2015

15.8

2014

2010
London – September 18, 2015

Source: JTI estimates. Note: Core revenue per thousand cigarette equivalent units on a reported basis

2014
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Confident about the future

London – September 18, 2015

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Operating environment is expected to stabilize
Real GDP, change vs. PY
2014

2015e2016eRussia

0.6%

-3.6%

0.6%

Ukraine-6.8%-10.0%

0.9%

Kazakhstan

4.3%

1.9%

2.3%

Azerbaijan

2.0%

1.7%

1.7%

Belarus

1.5%

-1.5%

1.5%

•

Economy is expected to moderately
improve in 2016•

Key markets are introducing long-term
excise planning cycles with gradual andpredictable increases•

Eurasian Economic Union of Russia,
Kazakhstan, Belarus, Armenia andKyrgyzstan is progressing wellExcise evolution, CAGR 2010-2014

29%

27%

21%

13%
5%
Russia© Copyright JT 2015

UkraineKazakhstan

Azerbaijan

BelarusLondon – September 18, 2015

Source: JTI estimates, EIU estimates as of September 11, 2015. Note: Excise evolution on US$ basis

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Strong profit growth trends in both Russia and other CIS+ markets
expected to continue
EBITA, CAGR 2010-2014

RussiaOther CIS+markets© Copyright JT 2015

Note: EBITA on a reported basis+10%+14%London – September 18, 2015

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Closing remarks•Committed to consolidate our leading position in the CIS+ Region•

Excise tax increases should be more predictable and passed onto the consumer•Pricing opportunities remain but could be affected by competitive activities in the value
segment•

Focused investment in equity building programs will continue with the aim to fuel theGFB share growth momentum•

Strong regional distribution capability•

Fully engaged and empowered workforce© Copyright JT 2015

London – September 18, 2015

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