Imperial Brands PLC · LSE:IMB

Imperial Brands — Imperial Tobacco Group — Investor Presentation (September 2010)

18 slides from Imperial Brands's investor presentation, Sep 28, 2010

  1. Slide 1: Snus: Driving Growth in Nordic Region

    Snus Driving Growth in Nordic Region Marcus Diemer General Manager Central Europe North 28 September 2010

  2. Slide 2: Agenda

    Agenda ƒ Gaining footprint in the Nordic area ƒ Access to snus – creating and driving opportunities ƒ Imperial’s five year snus track record ƒ Future growth strategy 2

  3. Slide 3: Central Europe North Region

    Central Europe North Region infill strategy consistently applied ƒ Growing organically and through acquisitions – Skruf (Sept ’05) – Gunnar Stenberg (Feb ’06) – Tremaco (Jan ’07) – Altadis (Jan ’08) ƒ Operating in six markets – own route to market in Sweden, Norway, Finland and Estonia – distributio

  4. Slide 4: Six Year Review

    Six Year Review snus driving Nordic net sales progression FY04 Paper/Tubes FMC FY10E RYO/Pipe 85% 4% 12% 11% 10% 12% 10% Paper/Tubes RYO/Pipe 34% FMC Cigars 34% Snus Lighters/Machines Nordic net sales includes Scandinavian and Baltic markets 4

  5. Slide 5: Nordic Region

    Nordic Region snus market dimensions Sweden/ Norway Duty Free Travel Retail Volume (tonnes) 5,900 1,100 250 Growth -1% +6% +24% Net Sales Value +10% +20% +30% SWMA 87% SWMA 76% SWMA 81% BAT 8% Key Players IMT 4% IMT 21% IMT 16% BAT 3% BAT 3% JTI 1% Imperial estimates for year ended 30 September 2010

  6. Slide 6: Nordic Category Development

    Nordic Category Development portion driving growth 300 ƒ Continued swing to high margin 248 254 250 234 240 230 227 portion 31% 29% 200 33% – over 70% volume share 35% 40% cans (m) 49% 150 ƒ Trends set to continue 30% 34% 26% 28% 22% – high social acceptance 100 17% – price advantage vs FMC 50 39% 3

  7. Slide 7: Skruf

    Skruf our premium brand This space appears blank because we have removed the images that appear in the presentation. This is because we currently do not feature tobacco product brand imagery on our website. 7

  8. Slide 8: Knox

    Knox our value brand This space appears blank because we have removed the images that appear in the presentation. This is because we currently do not feature tobacco product brand imagery on our website.

  9. Slide 9: Our Nordic Snus Performance

    Our Nordic Snus Performance delivering sustainable sales growth ƒ 5 year compound growth +57% 600 18.6 500 8% ƒ Outperforming in Norway 14.3 400 7% – Skruf strong No.2 brand cans (m) 49% 300 10.1 – 32% portion segment share 6% 49% 6.5 43% ƒ Sweden good momentum 200 4.1 37% 100 44% – Skruf growing in

  10. Slide 10: Our Nordic Snus Performance: No.2 in value

    Our Nordic Snus Performance No.2 in value 25 IMT ƒ Increasing net sales 20 – up 33%* vs FY09 BAT NSV Indexed 15 ƒ Benefiting from 10 successfully establishing 5 a premium brand JTI 0 FY05 FY06 FY07 FY08 FY09 FY10E Imperial estimates; index takes IMT in 2005 as base; *FY10 estimate 10

  11. Slide 11: New Skruf Factory

    New Skruf Factory need for additional capacity ƒ Current maximum annual capacity around 600 tonnes ƒ New factory planned for 1,000 tonnes per year ƒ Additional recruitment ongoing ƒ Capital investment up to £29 million ƒ First production planned end of February 2011 11

  12. Slide 12: Current Skruf Factory

    Current Skruf Factory converted dairy building in Småland 12

  13. Slide 13: New Skruf Factory

    New Skruf Factory architects impression

  14. Slide 14: 'We Love Snus'

    ‘We Love Snus’ benefiting from a passionate approach ƒ Creating brands with clear unique selling propositions ƒ Prioritising snus over smoking tobacco ƒ Competing strongly in growing brown and white portion segments ƒ Addressing trade and retailer needs ƒ Adapting a consumer centric mindset 14

  15. Slide 15: Demographics of Snus – Age

    Demographics of Snus – Age Norway quantitative snus study 4 4 5 6 7 65+ 55-64 45-54 numbers (%) 25 35-44 25-34 36 18-24 92 80 83 51 36 20 Snus Average Leading Brand Skruf Skruf Loose Skruf WP Skruf OP Source: Representative Consumer Study February 2010, Norway 15

  16. Slide 16: Product/Brand Developments

    Product/Brand Developments insight based approach Product Brand/Communication ƒ Capacity extension ƒ Can/design upgrades – avoiding out of stock - SKU differentiation ƒ Consumer relevant quality ƒ Portfolio extensions improvements ƒ Communication ƒ Product development – public relations – extensions

  17. Slide 17: Strategic Focus

    Strategic Focus Delivering sustainable shareholder returns Growth drivers Cost Sales Cash Optimisation Growth Utilisation Our key assets Brand Total Market Equity Tobacco People Footprint Strong regional and local brands How we Access leveragePresent to snus our in 4 markets assets with own RTM Cons

  18. Slide 18: Snus: Driving Growth in Nordic Region

    Snus Driving Growth in Nordic Region Marcus Diemer General Manager Central Europe North 28 September 2010

Imperial Tobacco Group — Investor Presentation (September 2010) on 6ix