Imperial Brands : Annual Report and Accounts 2021

ANNUAL REPORT AND ACCOUNTS 2021

SET UP FOR

SUCCESS

We are Imperial Brands, a global consumer organisation and the fourth largest international tobacco company, operating across 120 markets.

OVERVIEW

At a Glance	2
Our Value Creation Framework	4
Chair's Statement	14
Chief Executive's Statement	18
Business Model	24
Investment Case	26
Our Operating Environment	28
Strategy for Success	30

PERFORMANCE

Key Performance Indicators	36
Stakeholder Engagement	38
Our People	46
ESG Review	50
Operating Review	64
Financial Review	71
Principal Risks and Uncertainties	80

GOVERNANCE

Chair's Introduction	94
Board Leadership	96
Board Engagement	102
The Board and its Committees	104
Board Statements	106
Succession and Nominations	108
Committee
Audit Committee	111
Remuneration Report	120
Directors' Report	140

FINANCIALS

Independent Auditors' Report	148
Consolidated Income Statement	160
Consolidated Statement	160
of Comprehensive Income
Consolidated Balance Sheet	161
Consolidated Statement of Changes	162
in Equity
Consolidated Cash Flow Statement	163
Notes to the Financial Statements	164
Imperial Brands PLC Balance Sheet	220
Imperial Brands PLC Statement	220
of Changes in Equity
Notes to the Financial Statements	221
of Imperial Brands PLC

SUPPLEMENTARY

INFORMATION

Related Undertakings	225
Shareholder Information	235

PERFORMANCE MEASURES	Adjusted (Non-GAAP)	Market share
USED THROUGHOUT	Non-GAAP measures provide a useful	Market share data is presented
THE REPORT	comparison of performance from one	as a 12-month moving average
Reported (GAAP)	period to the next. Reconciliations can	weighted across the markets in
be found in notes 3, 6, 8, 10 and 31.	which we operate.
Complies with International
Financial Reporting Standards	Constant currency basis	Stick equivalent
and the relevant legislation.	Removes the effect of exchange rate	Stick equivalent volumes reflect
	movements on the translation of the	our combined cigarette, fine cut
	results of our overseas operations.	tobacco, cigar and snus volumes.
	We translate current year results at
	prior year foreign exchange rates.

Imperial Brands is transforming. In January 2021 we announced a new strategy, which is supported by new ways of working to enhance our culture.

By putting the consumer at the centre of the business, we seek to strengthen sustainable delivery and unlock long-term value for all our stakeholders.

For more information

please see

www.imperialbrandsplc.com

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OVERVIEW IMPERIAL BRANDS AT A GLANCE

TRANSFORMING TO UNLOCK VALUE

Driven by insights and data, we seek to meet the expectations of adult smokers by leveraging our international and local brands to serve their needs. We are refining our ways of working and fostering our challenger mindset.

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TRANSFORMING OUR BRANDS

Our portfolio of brands connects with adult smokers in all the key tobacco and next generation product (NGP) segments. We invest in brand innovation to meet evolving consumer preferences.

4th largest

INTERNATIONAL TOBACCO BUSINESS

CIGARETTES / FINE CUT

CIGARS

SNUS

NGP

TRANSFORMING OUR MARKETS

We are focused on five priority combustible markets representing around 70% of our adjusted operating profit. We're investing in improved sales execution and brand building to drive sustainable growth.

120

MARKETS

TRANSFORMING OUR CULTURE

We are changing how we work to focus on the consumer and to align our resources with our strategy, supported by a culture change that is key to our transformation.

27,700

EMPLOYEES*

UK	Germany	Spain
JPS	JPS	Ducados
Golden Virginia	West	Fortuna
Lambert & Butler	Gauloises	Nobel
Carlton	Davidoff	West

USA	Australia
Winston	JPS
Kool	Champion
Maverick	Riverstone
Backwoods	Parker & Simpson

* Pro-forma number excluding the La Romana disposal. See Note 7 of the financial statements.

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