2021 International Tobacco Business Results & 2022 Tobacco Business Outlook
Eddy Pirard
JTI President & Chief Executive Officer
FORWARD-LOOKING STATEMENTS
This presentation contains forward-looking statements. These statements appear in a number of places in this document and include statements regarding the intent, belief, or current 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 these terms or other similar terminology. 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:
- increase in awareness of health concerns related to smoking;
- regulatory developments; including, without limitation, tax increases and restrictions on sales, marketing, packaging, labeling and use of tobacco products, privately imposed restrictions and governmental investigations;
- litigation around the world alleging adverse health and financial effects resulting from, or relating to, tobacco products;
- our ability to further diversify our business beyond the traditional tobacco industry;
- our ability to successfully expand internationally and make investments outside Japan;
- competition, changing consumer preferences and behavior;
- our ability to manage impacts derived from business diversification or business expansion;
- economic, regulatory and political changes, such as nationalization, terrorism, wars and civil unrest, in countries in which we operate;
- fluctuations in foreign exchange rates and the costs of raw materials; and
(10)catastrophes, including natural disasters.
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2021 | Industry leading performance across all KPIs
2021 performance (USD basis)
• Record* organic volume growth, driven |
by |
+29.6%
31.8%
• continued market share gains |
• resilient industry volume, mainly |
driven by lower illicit trade |
• Robust price/mix contribution fueled |
+4.7pp
+10.5% +10.6%
+5.6%
JTI | GFB | Core | AOP | AOP |
volume | volume | revenue | margin | |
strong core revenue increase | |
• Record* AOP and AOP margin increase, | |
boosted by | |
• | improved market mix |
• | transformation initiatives |
• | product costs containment |
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Note: 2021 variance vs. PY. Core revenue, AOP (adjusted operating profit) and AOP margin at constant currency. * within the last 10 years
Strategic focus strengthened business fundamentals
COMBUSTIBLES
- Accelerated market share gains across the majority of our markets
- Solid and resilient pricing underpinned robust core revenue growth
- Transformation benefits are exceeding initial plan
REDUCED RISK PRODUCTS
- Prioritized investment behind HTS
- Focus on markets that matter
- Building consumer and trade insights from Japan, Russia, Italy and the UK
- Improved capabilities in consumer-centricity, science, R&D and digital
2021 | +1.7pp | $690 | $100+ | ~70% | ~70% | ||
vs. PY | to 31.9% | MM | MM | ||||
SoM | 1) | Price/mix | 2) | Transformation | Coverage | Investment5) | |
benefits3) | HTS category4) | as % of RRP | |||||
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Note: 1) Based on JTI's top-30 markets (cigarettes + fine cut). 2) Contribution to core revenue growth at constant FX. 3) Annualized benefits. 4) Ploom's coverage of HTS industry volume. 5) Ploom's marketing & operating expenses out of RRP total.
Volume fueled by strong combustible market share growth …
JTI combustible SoM,1)vs PY
Philippines +5.1pp
France +1.8pp
Russia +1.5pp
Spain +1.1pp
Turkey +1.1pp
Italy +0.9pp
UK+0.8pp
Romania +0.7pp
Taiwan +0.3pp
JTI SoS,2) vs PY
+3.7pp
to 40.2%
Mid-price
+2.9pp
to 34.2%
Value
- Significant share of market gains
- Increases in 29 of our top-30 markets
- Industry leading share gains, notably in France, the Philippines, Romania, Russia, Spain and the UK led by strong equity of GFBs and local brands
- Increased share both in the mid-price and the growing value cigarette segment
- Further strengthened leading position in fine cut in Western Europe
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Note: 1) Based on cigarettes + fine cut. 2) Based on cigarettes in key markets.
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Japan Tobacco Inc. published this content on 14 February 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 February 2022 06:31:58 UTC.