JTI 1H 2016 Financial Results
Roland Kostantos

Senior Vice President,Finance and IT, Chief Financial Officer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, or current andfuture 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 these terms or other similarterminology. These statements are not guarantees of future performance and are subject to various risks and uncertainties. Actual results, performance or achievements, 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-looking statements. In addition, these forward-looking
statements are necessarily dependent upon assumptions, estimates and data that may be incorrect or imprecise and involve known and unknown 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 2016.

London – September 23, 2016

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 orperformance to our investors. They are not intended to be used for any otherpurpose.

© Copyright JT 2016

London – September 23, 2016

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Agenda•First Half 2016 Results•

First Half 2016 Performance by Cluster•

Summary and FY 2016 Outlook© Copyright JT 2016

London – September 23, 2016

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First half 2016 results

London – September 23, 2016

JT Investor Meeting5Strong 1H 2016 performance(BnU, $MM)

1H 2016

vs. 1H 2015

Total volume

199.7

+4.4%

GFB volume

140.7

Core revenue

5,700

Adjusted operating profit

2,083© Copyright JT 2016
Note: Core revenue and adjusted operating profit at constant currencyLondon – September 23, 2016

+6.7%

+12.6%+17.7%JT Investor Meeting

6Moderate industry decline with continued share gains driven by GFBs
Industry size (BnU)

JTI SoM-0.8%+0.4pp651.7646.2

1H 2015© Copyright JT 2016

1H 201625.9%

1H 2015GFB SoM+0.8pp

26.2%
17.8%

1H 2016

London – September 23, 2016
Source: Internal estimates. Note: SoM on 6-month rolling average to June, including cigarettes and fine cut, based on JTI’s top-40 markets (~85% of total volume)1H 201518.5%

1H 2016
JT Investor Meeting7Winston continues to drive share growth across JTI
Winston share of market• Winston ranked #2 globally• SoM gains in France, Germany, Iran,Italy, Philippines, Russia and Turkey+0.9pp• Growth fueled by ongoing equity
enhancements to RMC and fine cut

9.2%

9.6%

8.7%

1H 2014© Copyright JT 2016

1H 2015

1H 2016
London – September 23, 2016

Source: Internal estimates. Note: Winston SoM based on JTI’s top-40 markets (over 85% of Winston volume), including cigarettes and fine cut. SoM on 6-month rolling average to June

JT Investor Meeting8LD growing market share• Record market share achieved in Canada,
Kazakhstan, Romania, Russia and Ukraine

LD share of market+0.5pp3.1%• Innovative line extensions, such as LD Club
Compact, drove 70% of volume growth overthe last 2 years

3.3%

2.8%

1H 2014© Copyright JT 2016

1H 2015

1H 2016
London – September 23, 2016

Source: Internal estimates. Note: LD SoM based on JTI’s top-40 markets (over 90% of LD volume), including cigarettes and fine cut. SoM on 6-month rolling average to JuneJT Investor Meeting9Camel growing share of market and shipment volume• Third consecutive year of volume andshare growth

Camel share of market+0.8pp• 2016 share gains driven by Italy, Benelux
markets, Czech Republic, South Africa
and the Philippines• Volume growth further enhanced by
Camel equity in seeding markets

3.2%

3.3%

1H 2015

1H 2016

2.5%
1H 2014© Copyright JT 2016

London – September 23, 2016

Source: Internal estimates. Note: Camel SoM based on JTI’s top-40 markets (over 80% of Camel volume), including cigarettes and fine cut. SoM on 6-month rolling average to June

JT Investor Meeting10Solid pricing drives core revenue growthCore revenue ($MM)+12.6%
5,700
403

5,061236

1H 2015

Volume© Copyright JT 2016

Price/MixLondon – September 23, 2016

1H 2016@ constant FX
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11

Growing profit and business investments
Adjusted operating profit ($MM)+17.7%

-166

2,083

Investments& Other

1H 2016@ constant FX390
1,77089

1H 2015

Volume© Copyright JT 2016

Price/MixLondon – September 23, 2016

JT Investor Meeting12First half performance by clusterLondon – September 23, 2016

JT Investor Meeting13

Robust top and bottom line results across clusters
Total volume
1H 2016 vs. 1H 2015

+7.9%

S&WE

+4.5%

N&CE
CIS+

Adjusted operating profit
1H 2016 vs. 1H 2015

+9.9%

+18.2%

+7.5%

+2.7%

+9.1%

-4.4%

+4.4%

© Copyright JT 2016
Note: Core revenue and adjusted operating profit at constant currency+28.2%+20.6%+13.4%R-o-W
JTICore revenue
1H 2016 vs. 1H 2015+12.6%
London – September 23, 2016+23.3%+17.7%JT Investor Meeting14

Europe: Exceptional performance led by GFBs
Europe (S&WE + N&CE)
Key Performance Indicators
1H 2016 vs. 1H 2015
Total volume

JTI Share of market
1H 2016 vs. 1H 2015
Total+6.4%

GFB volume+11.8%+0.9pp

GFBCore revenue+8.7%

WinstonAdjustedoperating profit

+8.3%

Camel

+1.3pp+0.6pp+0.3pp© Copyright JT 2016
London – September 23, 2016
Note: Core revenue and adjusted operating profit at constant currency. Source: Internal estimates. SoM on 6-month rolling average to June, including cigarettes and fine cut

JT Investor Meeting15CIS+: Pricing drives strong revenue and profit growth
Key Performance Indicators
1H 2016 vs. 1H 2015•

Industry size decline results in total volumereduction•

GFB resilience driven by strong share ofmarket performance:• Kazakhstan+1.4pp• Romania+4.5pp• Russia+0.5pp• Ukraine+0.3pp•Strengthened #1 SoM position in Russia
and Kazakhstan•

Robust pricing supports strong core
revenue and earnings growth

Total volume -4.4%

GFB volume

Core revenue-2.1%+9.1%

Adjustedoperating profit© Copyright JT 2016
Note: Core revenue and adjusted operating profit at constant currency+28.2%

London – September 23, 2016

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16

Russia: Market size decline moderates while downtrading continues
Industry volume evolution-10.6%

Price segment dynamics

13.1%

12.5%

12.4%

Premium

25.7%

25.1%

24.0%

Sub-Premium

27.2%

27.1%

25.6%

Mid-Price

34.0%

35.3%

37.9%

Value

1H 2014

1H 2015

1H 2016

-5.8%
-4.5%

1H 2013 1H 2014 1H 2015 1H 2016
© Copyright JT 2016
Source: Internal estimates

London – September 23, 2016

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Russia: Investment in equity drives GFB share growth and pricing
Sub-Premium

Pricing change (RUB / pack)

Share evolution YoY (pp)1H 2015

1H 2016+49%

SoM+0.1+0.2
100SoS+2.0+3.7

67

Jan-1480

Jan-15Jan-16

Mid-Price/Value
SoM

+0.5

+57%+0.3

85

SoS+0.5+0.4

54

Jan-14© Copyright JT 2016
Source: Internal estimates, Nielsen. SoM and SoS on 6-month rolling average to June

London – September 23, 2016

65

Jan-15
JT Investor MeetingJan-1618

Rest-of-the-World: Growing profit while investing for the long-term
Key Performance Indicators
1H 2016 vs. 1H 2015

Total volume

GFB volume

Core revenue

Adjustedoperating profit© Copyright JT 2016
Note: Core revenue and adjusted operating profit at constant currency+13.4%+14.2%+20.6%•Share of market growth across manymarkets including:• Brazil, Canada, Iran, Korea, Myanmar,
Philippines and Taiwan•

Pricing in Canada, Iran, Taiwan, Turkey
drives strong revenue growth•

Significant double-digit profit growth afterinvestment in seeding markets andemerging products+23.3%
London – September 23, 2016

JT Investor Meeting19Turkey: Improved profitability and higher market share
JTI Share of market (%)•29.9%

26.9%

Share of market growth following Camel
price repositioning in May 2014

+3pp

1H 2014•

Stabilization of share at 30% level•

Robust pricing drives improved profitability

1H 2016

JTI Core revenue per M
Index (1H 2014 = 100)
+18%from the first half of 2016•

+1TRY increase across the portfolio
announced in July 2016

1H 2014

1H 2016© Copyright JT 2016
London – September 23, 2016
Source: Nielsen. JTI SoM on 6-month rolling average to June. Note: Core revenue per thousand cigarette equivalent units at constant currency

JT Investor Meeting20

Iran: Strong growth led by acquisition and expanded distribution
Volume progression(Index, 1H 2015=100)
208
ATIbrands•Winston #1 brand*•

ATI acquired in September 2015•

Improved route-to-market drove JTI
brands’ YoY volume growth above 50%

+57%

JTI
brands100

1H 2015© Copyright JT 2016
* JTI internal estimates•

Significant contributor to earnings
growth in 2016

1H 2016
London – September 23, 2016

JT Investor Meeting21

Canada: Continued share gains in a highly regulated market
Share of market development
LD launch(Sep. 2013)+2.4pp•17.0%

15.4%
14.6%

•Retail display ban•

SIPPs ban•

75% health warnings

14.8%
4.1%

•1.2%
0.0%
1H 2014

1H 2015© Copyright JT 2016
Source: Internal estimates. SoM on 6-month rolling average to June

Strong JTI share growth of 2.4pp
since 2013 driven by LD

2.3%

1H 2013Highly regulated tobacco market:•

Robust year-on-year pricing•JTI volume growth in 1H 2016

1H 2016
London – September 23, 2016

JT Investor Meeting22Summary and FY 2016 OutlookLondon – September 23, 2016

JT Investor Meeting23

Well positioned to achieve double-digit profit growth in FY 2016•

Strengthening business fundamentals with increased global share of market driven by GFBs•

Robust 1H performance with growth across all Key Performance Indicators•

Well positioned to achieve full year earnings growth of 11.4% in 2016:• Total volume and core revenue to increase 2.0% and 8.1%, respectively• Secured robust pricing• Increased investments in emerging products and seeding markets© Copyright JT 2016
Note: Financial targets at constant currency

London – September 23, 2016

JT Investor Meeting24