1

Unlocking Our PotentialFewer, bigger, better execution

Arthur van BenthemGroup Sales Director

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My Journey

3

Unlocking Our Potential

1. Sales Growth Drivers… fewer, bigger, better execution

2. Customer Engagement… leveraging shopper & customer insights

4

Unlocking Our Potential

1. Sales Growth Drivers… fewer, bigger, better execution

2. Customer Engagement… leveraging shopper & customer insights

5

Total Tobacco portfolio of Global, Regional and Local brands targeting core consumer needs

Margin growth from superior Excise and BPPC capability

Consumer needs based game-changing and scalable innovation

A customer-centric route to market which maximizes Availability and Customer Advocacy

Priority Sales Growth Drivers

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Prioritise key initiatives

Scale initiatives

Sustainability

Fewer, Bigger, Better Execution

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Reinvestment for Growth

High quality investments, high returnsInvestment in growth

Investment efficiency

Scale ideas within/across markets

Performance managementProcess, Leadership and Organisation Capabilities

Our Key AssetsOur Key Assets

BrandEquityBrandEquity

TotalTobacco

TotalTobacco

MarketFootprintMarket

Footprint PeoplePeople

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Portfolio

9

0

20

40

60

80

100

120

140

160

180

200

220

May 09

Nov 09

Aug 09

Feb 10

May 10

Aug 10

Nov 10

Feb 11

May 11

Davidoff SSLDavidoff SlimDavidoff PL

Davidoff KSSL

Ukraine Davidoff (Indexed) Total Davidoff (Indexed)

Davidoff Driving Premium Growth

143

131127

113111106

100

HY11FY10FY09FY08FY07FY06FY05

HY11 is annualised

10

Morocco +13%

Algeria +40%

Tunisia +36%

Gauloises Success in North Africa

11

0

2

4

6

8

10

12

Apr 11

Oct 10

Apr 10

Oct 09

Apr 09

0

2

4

6

8

Sep 10

Sep 09

Sep 08

Sep 06

Sep 07

Germany UKJPS Silver

0

100

200

300

400

500Total JPS indexed volume

0

1

2

3

Oct 10

Apr 10

Oct 09

Apr 09

Apr 11

Australia

Pall Mall

JPS range

Building JPS International Profile

Sep04

Sep05

Sep06

Sep07

Sep08

Sep09

Sep10

Germany, UK, and Australia show market shares

JPS

12Imperial estimates; combined market volumes for Poland, Hungary, Czech Republic, Slovakia and Slovenia

50

60

70

80

90

100

110

120

130

FY06 FY10FY08 FY09FY07

billi

on s

tick

equi

vale

nt

FMC FCT

Driving FCT Growth in EU Accession

Cigarette CAGR -2%FCT CAGR +7%SE CAGR -1%

13Imperial estimates; weighted average shares for Poland, Hungary, Czech Republic, Slovakia and Slovenia combined

0

5

10

15

20

25

30

35

40

FY06 FY10FY09FY08FY07

Weighted Avge FMC Share Weighted Avge FCT Share

mar

ket s

hare

(%)

17.2

7.2

18.3

13.6

22.7 21.723.2 22.2 23.4

39.7

EU Accession Share Momentum

14

Ducados Rubio MYO in Spain

0

5

10

15

20

25

30

Apr10

May10

Jun10

Jul10

Aug10

Sep10

Oct10

Nov10

Dec10

Jan11

Feb11

Mar11

Apr11

May11

% s

hare

of F

CT

cate

gory

25%

Rolling Out C. Europe Growth Model

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Innovation

16

0

5

10

15

20

25

KS Superslims

Capitalising on Eastern Europe Growth

Superslims

Fair share13%

Impe

rial s

hare

of G

row

th

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Exploiting Scalable Innovation

Patented GlideTec innovation

Consumer “wow” effect

Initial launch in UK – Asda, BP, Shell & Esso

Significant capacity investment

Multi market roll-out planned

VIDEO – GlideTec Customer Focus Group

This video has not been made available on our website

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Pricing

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Excise Approach Germany

Long term excise tax predictability

Mix between Specific and Ad Valorem

Innovative minimum excise tax

Tax differentials between product categories

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Enhancing our Capabilities

IdentifyIssue & Opportunity

Define BPPCArchitecture

Execute Picture of Success Monitor & Measure

Adjust What it is

in brand, pack, price by channel

22Source: Imperial estimates

% s

hare

of m

arke

tPricing Strategy Drives Growth

0

1

2

3

4

5

Jun-09

Sep-09

Dec-09

Mar-10

Jun-10

Sep-10

Dec-10

Mar-11

Abso

lute

Cha

nge

In B

rand

% S

hare

of M

arke

t

12

13

14

15

16

17

18

19

HY 09 FY 09 HY 10 FY 10 HY 11

Australia UK

Sterling

Windsor Blue

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Customer Engagement

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Outperforming in Dark Markets

Optimise local Trade Marketing capability

Australia increased share by 1.8% to 18.8% in HY11

Norway market share of snus up 1.1% and cigarettes up 0.3% in HY11

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Outlet Distribution

USA Gold

Dutch Masters

Sonoma

Backwoods

Phillies

0% 10% 20% 30% 40% 50% 60% 70% 80%

USA Gold

Dutch Masters

Sonoma

Backwoods

Phillies

Integration to Maximise USA Growth

This space appears blank because we have removed the

images that appear in the presentation.

This is because we currently donot feature tobacco product

brand imagery on our website.

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Unlocking Our Potential

1. Sales Growth Drivers… fewer, bigger, better execution

2. Customer Engagement… leveraging shopper & customer insights

2727

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Understanding Stakeholder Needs

High non-availability on-shelf for the industryDisappointed shoppers, missed revenue/marginRoute to Market

4. Purchase Experience

Availability Shop convenience

shopper

Cash flowRetention &

acquisition of shoppers

customer

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Where we compete

How we make it happen

CapabilitiesOrganisationaldesign

How we deliver it

Sales and channelstrategy

With adistinctive proposition

To the consumerShopper marketing

To the customerAccount managementTrade activationTrade investments

3-partymanagement

Supply chainalignment

Sales force effectiveness

Route-to-market model

Customer Engagement Agenda

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Maximising Shareholder Returns

Sales

HighMargins

Strong Cash Flow

Reinvest

Strong Cash Flow

Sales

Reinvest

Strong Cash Flow