Fact Sheets. Japan Tobacco Inc. FY2015

Transcription

1 Japan Tobacco Inc. Fact Sheets FY215 1: Financial Data 9: International Tobacco Business 12: Japanese Domestic Tobacco Business 21: Number of Employees/Subsidiaries and Affiliates 22: Glossary

2 Fact Sheets Financial Data From the third quarter of FY215, beverage business has been classified as discontinued operations in accordance with requirements. Consequently, profit (loss) and some items from continuing operations and discontinued operations are presented separately for the financial results of FY215 and FY214. To facilitate better understanding of our business performance in FY215, we provide the figures with a focus on continuing operations except those related to the balance sheet, which are on a continuing and discontinued operations combined basis. In addition, FY214 was a transitional period due to the unification of accounting period. For the purpose of fair business performance comparison, we are providing figures for the twelve-month (January 1 December 31, 214) period with regard to all business segments in continuing operations (Like-for-Like basis). Note: Revenue, operating profit, adjusted operating profit from continuing operations and profit attributable to owners of the parent company from continuing and discontinued operations combined for January December, 214 were disclosed in the Annual Securities Report, which was audited. Net Sales Excluding Excise Taxes/Revenue 3, 2, Continuing operations Like-for-Like 1, FY29 FY21 FY211 FY21 FY211 FY212 FY FY215 Total 2, , , ,59.4 2,33.8 2,12.2 2, , ,252.9 International Tobacco Business 1, ,1.7 1,27. 1,328. 1,317.2 Japanese Domestic Tobacco Business 1,16.7 1,27.9 1, Pharmaceutical Business Food Business Beverage Business Processed Food Business Other Business Adjusted Net Sales Excluding Excise Taxes/ Core Revenue International Tobacco Business ,2.7 1, ,252.5 Japanese Domestic Tobacco Business SG&A Expenses () 1, 75 Continuing operations Like-for-Like 5 25 FY21 FY211 FY212 FY FY215 SG&A Advertising expenses Promotion expenses Shipping, warehousing expenses Commission Employee benefit expenses Research and development expenses Depreciation and amortization Impairment losses on other than financial assets Regulatory fine in Canada 12.8 L osses on sale and disposal of property, plant and equipment, intangible assets, and investment property Cooperation fee for terminating leaf tobacco farming 12.5 Impairment losses of investments in associates 9.7 Other JAPAN TOBACCO INC. FACT SHEETS FY215

3 R&D Expenses 6 Continuing operations Like-for-Like 4 2 FY29 FY21 FY211 FY21 FY211 FY212 FY FY215 R&D International Tobacco Business Japanese Domestic Tobacco Business Pharmaceutical Business Food Business Beverage Business Processed Food Business Note: The aforementioned research and development expenses include.7 and.7 billion yen for January December, 214 and FY215, respectively (), relating to basic research not affiliated to any segment (plant biotechnology related research, etc.) and conducted by JT corporate division. EBITDA/ Adjusted EBITDA FY29 FY21 FY211 FY21 FY211 FY212 FY213 EBITDA/Adjusted EBITDA International Tobacco Business Japanese Domestic Tobacco Business Pharmaceutical Business (9.6) (13.3) (12.3) (9.8) (1.) (12.7) (5.4) Food Business Beverage Business Processed Food Business Other Business 13.3 (12.1) (13.3) (11.) (9.8) (9.6) (12.7) Note: From FY21, Other Business means Others/Elimination and corporate. FACT SHEETS Adjusted Operating Profit () Continuing operations Like-for-Like FY215 Adjusted Operating Profit International Tobacco Business Japanese Domestic Tobacco Business Pharmaceutical Business (7.3) (2.3) Processed Food Business Other Business/Elimination (18.9) (22.2) Note: Adjusted operating profit of 214 was unaudited figure. JAPAN TOBACCO INC. FACT SHEETS FY215 2

4 Operating Income/ Operating Profit 8 6 Continuing operations Like-for-Like 4 2 FY29 FY21 FY211 FY21 FY211 FY212 FY FY215 Operating Income/Operating Profit International Tobacco Business Japanese Domestic Tobacco Business Pharmaceutical Business (13.5) (17.4) (16.1) (13.3) (13.5) (16.2) (9.) (7.3) (2.3) Food Business (13.6) (9.4) (6.3) (3.6) Beverage Business (2.1) Processed Food Business (2.5) (5.8) (.2) (1.2) 3.2 Other Business 1.5 (16.9) (17.9) (9.9) (31.8) Note: From FY21, Other Business means Others/Elimination and corporate. Financial Income and Expenses () Continuing operations Like-for-Like FY21 FY211 FY212 FY FY215 Financial Income Financial Expenses (25.9) (23.4) (28.4) (2.4) (12.8) (15.1) Net Income/Profit (attributable to owners of the parent company) Continuing operations Like-for-Like 2 1 FY29 FY21 FY211 FY21 FY211 FY212 FY FY215 Net Income/Profit (attributable to owners of the parent company) JAPAN TOBACCO INC. FACT SHEETS FY215

5 FY214, a transitional period for the change in accounting period, covers nine months from April 1, 214 to December 31, 214 for the Japanese domestic business. The same change in accounting period is applied to the Company s consolidated subsidiaries whose current closing date was other than December 31 (Reported basis). For the purpose of fair comparison and reference, twelve-month (January 1 December 31) period of results with regard to all business segments in continuing operations would be disclosed for 214 (Like-for-Like basis). Earnings per Share (EPS)/ Basic Earning per Share Yen 9, 6, Yen 3 2 3, 1 FY29 FY21 FY211 FY21 FY211 FY212 FY213 FY214 FY215 EPS/Basic Earning per Share 14,451 15,184 23,883 25, Diluted EPS 14,448 15,179 23,873 25, Notes: A 2 for 1 stock split went into effect on July 1, 212. Calculated on the assumption that this share split was conducted at the beginning of FY211 (April 1, 211). The figures for FY211 and the following fiscal years refer to the right hand scale in the graph. Return on Equity (ROE)/ ROE (attributable to owners of the parent company) % FY29 FY21 FY211 FY21 FY211 FY212 FY213 FY214 FY215 ROE/ROE (attributable to owners of the parent company) FACT SHEETS Return on Assets (ROA) % FY29 FY21 FY211 FY21 FY211 FY212 FY213 FY214 FY215 ROA Operating Income Margin/ Operating Profit Margin % FY29 FY21 FY211 FY21 FY211 FY212 FY213 FY214 FY215 Operating Income Margin/ Operating Profit Margin JAPAN TOBACCO INC. FACT SHEETS FY215 4

6 Free Cash Flow (FCF) FY29 FY21 FY211 FY21 FY211 FY212 FY213 FY214 FY215 Free Cash Flow Capital Expenditure (CAPEX) Continuing operations Like-for-Like 6 FY29 FY21 FY211 FY21 FY211 FY212 FY FY215 Capital Expenditure International Tobacco Business Japanese Domestic Tobacco Business Pharmaceutical Business Food Business Beverage Business Processed Food Business Other Business Note: From FY21, Other Business means Others/Elimination and corporate. Depreciation & Amortization 3 2 Continuing operations Like-for-Like 1 FY29 FY21 FY211 FY21 FY211 FY212 FY FY215 Depreciation & Amortization International Tobacco Business Japanese Domestic Tobacco Business Pharmaceutical Business Food Business Beverage Business Processed Food Business Other Business Note: From FY21, Other Business means Others/Elimination and corporate. 5 JAPAN TOBACCO INC. FACT SHEETS FY215

7 Total Assets 6, 4, 2, FY29 FY21 FY211 FY21 FY211 FY212 FY213 FY214 FY215 Total Assets 3, , , , ,667. 3, , ,74.7 4,558.2 Tobacco Business International Tobacco Business 2,765.9 Japanese Domestic Tobacco Business Pharmaceutical Business 114. Food Business Other Business 85. Total Equity and Equity Ratio/ Total Equity and Equity Ratio (attributable to owners of the parent company) 3, 2,4 1,8 1,2 6 FY29 FY21 FY211 FY21 FY211 FY212 FY213 FY214 FY215 Total Equity 1, , ,61.5 1,61.3 1, , , , ,521.5 Equity Ratio/Total Equity and Equity Ratio (attributable to owners of the parent company) % FACT SHEETS Book Value per Share (BPS)/ Book Value per Share (attributable to owners of the parent company) Yen 1,, 8, 6, 4, , , ,369.6 Yen 1,5 1, , 3 FY29 FY21 FY211 FY21 FY211 FY212 FY213 FY214 FY215 BPS/Book Value per Share (attributable to owners of the parent company) 172, ,997 16,571 16, , , ,369.6 Notes: A 2 for 1 stock split went into effect on July 1, 212. Calculated on the assumption that this share split was conducted at the beginning of FY211 (April 1, 211). The figures for FY211 and the following fiscal years refer to the right hand scale in the graph. JAPAN TOBACCO INC. FACT SHEETS FY215 6

8 Liquidity and Interest-Bearing Debt 1, FY29 FY21 FY211 FY21 FY211 FY212 FY213 FY214 FY215 Liquidity Interest-Bearing Debt Note: Interest-Bearing Debt includes lease obligations from FY21. Debt/Equity Ratio Times FY29 FY21 FY211 FY21 FY211 FY212 FY213 FY214 FY215 Debt/Equity Ratio Interest Coverage Ratio Times FY29 FY21 FY211 FY21 FY211 FY212 FY213 FY214 FY215 Interest Coverage Ratio JAPAN TOBACCO INC. FACT SHEETS FY215

9 Annual Dividends per Share Yen Yen 118 2, , 1 12, , 5 4, FY29 FY21 FY211 FY212 FY213 FY214 FY215 Annual Dividends per Share 5,8 6,8 1, (Retrospectively Adjusted) 5 Notes: A 2 for 1 stock split went into effect on July 1, 212. Calculated on the assumption that this share split was conducted at the beginning of FY211 (April 1, 211). The figures for FY211 and the following fiscal years refer to the right hand scale in the graph. 25 Dividend Payout Ratio on a Consolidated Basis % FY29 FY21 FY211 FY21 FY211 FY212 FY213 FY214 FY215 Dividend Payout Ratio ** Goodwill Amortization Adjusted* * Payout Ratio before goodwill amortization ** Based on basic EPS from continuing operations FACT SHEETS JAPAN TOBACCO INC. FACT SHEETS FY215 8

10 International Tobacco Business (Results for the 12 months ended December 31) Tobacco Shipment Volume (by Brand) Billions of cigarettes Total GFB Total Winston Camel Mild Seven/MEVIUS LD Benson & Hedges Silk Cut Sobranie Glamour Other Brands Note: The figures were restated with the change of HVT conversion rate since 213. Tobacco Shipment Volume (by Cluster) Billions of cigarettes Total South & West Europe North & Central Europe CIS Rest-of-the-World Note: The figures were restated with the change of HVT conversion rate since JAPAN TOBACCO INC. FACT SHEETS FY215

11 Core Revenue & Adjusted EBITDA/ Adjusted Operating Profit Millions of USD 15, 12, 9, 6, 3, Core Revenue 11,211 11,817 12,273 11,911 1,338 Adjusted EBITDA 3,944 4,3 4,623 Adjusted Operating Profit 4,26 4,253 3,257 Cluster Split % Core Revenue EBITA* Core Revenue Adjusted EBITA Core Revenue Adjusted EBITA Adjusted Core Operating Revenue Profit Core Revenue Adjusted Operating Profit South & West Europe North & Central Europe CIS Rest-of-the-World *EBITA based on US GAAP FACT SHEETS Share of Markets in Key Markets (12 month moving average, December) France 16.% 17.5% 2.% 2.8% 21.4% Italy 2.5% 21.4% 21.6% 19.9% 21.1% Russia 37.1% 36.4% 36.5% 34.9% 33.6% Spain 2.2% 2.3% 21.% 21.7% 22.3% Taiwan 38.1% 38.9% 39.4% 38.4% 39.2% Turkey 24.1% 26.3% 26.6% 29.% 3.2% UK 38.3% 39.4% 4.8% 41.3% 42.% Note: The figures were restated with the change of HVT conversion rate since 213. Source: Nielsen, Logista and IRI JAPAN TOBACCO INC. FACT SHEETS FY215 1

12 Tobacco Tax Structure (in Russia) (RUB) Change Minimum Tax (ths. cg.) 1,4 1,33 28% Ad valorem tax (to retail price) (%) 8.5% 11.% 29% Specific tax (ths. cg.) % VAT (% of pre-vat price) 18% 18% % [To weighted average price per pack] (RUB) Change Weighted average retail price % Ad valorem tax % Specific tax % VAT % Weighted average retail price before tax % Note: JTI estimates Number of International Factories Dec Dec. 31 International Cigarette and OTP Manufacturing Factories Other Tobacco-related Factories International Tobacco Manufacturing-related Factory Location (As of December 31, 215) Cigarette and OTP manufacturing factories Other tobacco-related factories Russia Saint Petersburg Switzerland Germany Sweden Russia Leningradskaya Oblast Russia Moscow UK Northern Ireland Poland Russia Yelets, Lipetskaya Oblast Belgium Serbia Ukraine Kazakhstan Andorra Turkey Romania Iran (Zanjan) Spain Canaries Jordan Egypt (Cairo) Egypt (Shebin El-Kom) Republic of Sudan Khartoum Myanmar South Sudan Juba Canada USA Tanzania Malawi Malaysia South Africa Brazil Notes: Locations of manufacturing factories to be closed by the end of 216: Russia (Moscow), South Africa (Wadeville, Germiston) Location of manufacturing factory to be closed by the end of 217: UK (Lisnafillan, Northern Ireland) Location of manufacturing factory to be closed by the end of 218: Belgium (Wervik) 11 JAPAN TOBACCO INC. FACT SHEETS FY215

13 Japanese Domestic Tobacco Business Since FY214, the Company has changed its fiscal year ends to December 31; before FY214, the fiscal years were ended March 31. As a Like-for-Like basis, twelve-month (January 1 December 31) results of Japanese domestic tobacco business have been disclosed for 214. Total Domestic Market Billions of cigarettes FY29 FY21 FY211 FY212 FY FY215 Total Domestic Market Source: Tobacco Institute of Japan JT Sales Volume and JT Share Billions of cigarettes % FY29 FY21 FY211 FY212 FY FY215 JT Sales Volume JT Share FACT SHEETS Sales Volume of China Division and Domestic Duty-Free Billions of cigarettes FY29 FY21 FY211 FY212 FY FY215 Sales Volume Note: China Division covers China, Hong Kong, and Macau markets. JAPAN TOBACCO INC. FACT SHEETS FY215 12

14 Market Share by JT Brand Family % FY29 FY21 FY211 FY212 FY FY215 Mild Seven/MEVIUS Winston* Seven Stars* Pianissimo* (Caster)* (Cabin)* Peace Hope Other Brands *1 Cabin and Caster were integrated into the Winston family in August 215. *2 Retrospective of figures for Alaska, which was integrated into the Seven Stars family in October 211. *3 Retrospective of figures for icene and Lucia, which were integrated into the Pianissimo family in January 21. Top 2 Selling Products in Japan by Market Share (Jan-Dec, 215) Product Brand Owner Share (%) 1 Seven Stars JT Mevius One 1's Box JT Mevius Super Lights JT 3. 4 Wakaba JT Echo JT Mevius Lights JT Mevius Extra Lights JT Mevius JT Seven Stars Box JT Marlboro Lights Menthol Box PMI Mevius Super Lights 1 s Box JT Mevius Extra Lights 1 s Box JT Kent 1 1's Box BAT Marlboro KS Box PMI Winston XS Caster One 1's Box JT Winston XS Caster 5 JT Mevius Extra Lights Box JT Mevius One JT Winston Cabin 8 Box JT Mevius Premium Menthol Option 5 JT 1.1 Source: Tobacco Institute of Japan 13 JAPAN TOBACCO INC. FACT SHEETS FY215

15 Menthol Products Market Share % FY29 FY21 FY211 FY212 FY FY215 Menthol Products* Menthol JT Products * Market Share in top 1 sales products Products Priced at 45 or more per pack Market Share % FY29 FY21 FY211 FY212 FY FY215 JT Products Priced at 45 or more per pack* *Jul. 26 ~ Sep. 21: 32 or more, Oct. 21 ~ Mar. 214: 44 or more FACT SHEETS JT Net Sales per Thousand Cigarettes/Revenue per Thousand Cigarettes Yen 6, 5,5 5, 4,5 4, 3,5 FY29 FY21 FY211 FY212 FY FY215 JT Net Sales per Thousand Cigarettes/ Revenue per Thousand Cigarettes 4,56 4,582 5,52 5,52 5,485 5,617 5,661 Note: JT Net sales per thousand cigarettes/revenue per thousand cigarettes = (retail price sales retailer margins consumption tax national tobacco excise tax local tobacco excise tax national tobacco special excise tax) / sales volume X 1, JAPAN TOBACCO INC. FACT SHEETS FY215 14

16 Composition of JT Products by Price Range % FY29 FY21 FY211 FY212 FY FY215 Products Priced at 45 or more per pack* Products Priced at 42 ~ 44 per pack* Products Priced at 41 or less per pack* *1 Jul. 26 ~ Sep. 21: 32 or more, Oct. 21 ~ Mar. 214: 44 or more *2 Jul. 26 ~ Sep. 21: 3, Oct. 21 ~ Mar. 214: 41 *3 Jul. 26 ~ Sep. 21: 29 or less, Oct. 21 ~ Mar. 214: 4 or less New Product Launches and Sales Area Expansion 215 (2 products) (Menthol: 11 products, Tar 1mg: 3 products, Products at 45 or more per pack: 8 products) Date Product Menthol Tar (mg) Nicotine (mg) Price* Sales Region Feb. 15 Mevius Premium Menthol Option Yellow Nationwide Feb. 15 Mevius Premium Menthol Option Yellow Nationwide Feb. 15 Mevius Premium Menthol Option Yellow One 1's Nationwide Jun. 15 Mevius Mode 6 1's Nationwide Jun. 15 Mevius Mode 3 1's Nationwide Jul. 15 Hope Roast Brown (1 cigarettes per pack) Nationwide Jul. 15 Hope Rich Yellow (1 cigarettes per pack) Nationwide Jul. 15 Hope Menthol Pink (1 cigarettes per pack) Nationwide Jul. 15 Pianissimo Precia Temore Tokyo, Aichi and Toyama Jul. 15 Pianissimo Precia Temore One Tokyo, Aichi and Toyama Sep. 15 Seven Stars Menthol Beat 8 Box Nationwide Sep. 15 Seven Stars Menthol Smash 8 Box Nationwide Sep. 15 Seven Stars Menthol Beat 8 Box (7 cigarettes) Seven Stars Menthol Smash 8 Box (7 cigarettes) Miyagi and Ibaraki Nov. 15 Winston XS 1 Box Nationwide Nov. 15 Winston XS 8 Box Nationwide Nov. 15 Winston XS 3 1 s Box Nationwide Dec. 15 Winston XS Inazma Menthol 5 Box Nationwide Dec. 15 Winston XS Spirits Menthol 8 Box Nationwide Dec. 15 Winston XS Spirits Menthol 5 Box Nationwide Dec. 15 Winston XS Spirits Menthol One 1's Box Nationwide *Prices as of December 31, JAPAN TOBACCO INC. FACT SHEETS FY215

17 Number of New Product Launches FY29 FY21 FY211 FY212 FY FY215 Number of New Product Launches Number of JT Cigarette Products FY29 FY21 FY211 FY212 FY FY215 Number of JT Cigarette Products Smoking Rate (by gender) % FACT SHEETS (At the time of survey) All Adults Male Female Note: The survey method, along with the sample number, was modified from 26, resulting in a lack of comparability with results prior to 26. Source: JT Japan Smoking Rate Survey Smoking Rate (by age) % (Survey in 215) Total 2s 3s 4s 5s over-6s Male Female Source: JT Japan Smoking Rate Survey JAPAN TOBACCO INC. FACT SHEETS FY215 16

18 Taxation All tobacco products sold in Japan are subject to the national tobacco excise tax, the national tobacco special excise tax, and local tobacco excise tax. The national tobacco excise tax is set at 5,32 per thousand cigarettes, the national tobacco special excise tax at 82 per thousand cigarettes, and the local tobacco excise tax is set at 6,122 per thousand cigarettes. In addition, under the Consumption Tax Law, an 8% consumption tax is imposed as with other goods and services. All tobacco excise taxes and consumption tax are imposed not only for tobacco products manufactured in Japan but also for imported tobacco products. From April 1987, no customs duties apply to imported tobacco products. Changes of Tobacco Excise Taxes Item Tobacco Consumption Tax Tobacco Excise Tax Apr-1985 May-1986 Apr-1989 Apr-1997 Dec-1998 May-1999 Jul-23 Jul-26 Oct-21 Apr-214 Ad valorem (%) Specific ( /1, units) Ad Specific valorem* ( /1, (%) units) Specific ( /1, units) Specific ( /1, units) Specific ( /1, units) Specific ( /1, units) Specific ( /1, units) Specific ( /1, units) Specific ( /1, units) Specific ( /1, units) National Tobacco Excise Tax ,32 3,126 3,126 3,126 2,716 3,126 3,552 5,32 5,32 National Tobacco Special Excise Tax Local Tobacco Excise Tax , 3,126 3,126 3,126 3,536 3,946 4,372 6,122 6,122 Total Excise Tax , ,32 6,252 6,252 7,72 7,72 7,892 8,744 12,244 12,244 Consumption Tax 3.% 5.% 5.% 5.% 5.% 5.% 5.% 8.% Tobacco Regulation Changes Tobacco Consumption Tax was introduced * 1, was deducted from tax base for Ad valorem Tobacco Consumption Tax was increased Consumption Tax was tion Tax was Consump- introduced increased Tobacco Consumption Tax was renamed Tobacco Excise Tax National Tobacco Special Excise Tax was introduced Review of budget allocations in line with a revision of laws Tobacco Excise Tax was increased Tobacco Excise Tax was increased Tobacco Excise Tax was increased Consumption Tax was increased (Reference) Retail Price of Mild Seven/MEVIUS per pack Tax Incidence of Mild Seven/MEVIUS per pack (incl. Consumption Tax) 56.7% 59.7% 59.7% 59.1% 61.3% 61.3% 63.2% 63.1% 64.5% 64.4% Breakdown of Price Levels per Cigarettes Package (As of April 1, 216) List price 44 per pack List price 46 per pack Consumption Tax % % Retailer s Margin % % Total Tobacco Excise Tax % % National Tobacco Excise Tax % % Local Tobacco Excise Tax % % National Tobacco Special Excise Tax % % JT s Proceeds % % Net sales excluding excise taxes Net sales including excise taxes Retail price sales 17 JAPAN TOBACCO INC. FACT SHEETS FY215

19 Tobacco Manufacturing System Domestic leaf tobacco Leaf processing factory Threshing Drying Packing into a case Storing International leaf tobacco Decompose leaves into mesophyll and vein. Dry leaves to adjust moisture content appropriate for storing and ripening. Pack dried-leaves in an appropriate portion for storing and transporting. Ripen leaves for a certain period. Cigarette manufacturing factory Consumer Retailer Packing Making Flavoring Cutting Blending Pack cigarettes into parcels or cartons and cardboard boxes. Roll cigarettes. Add aromatic essences called top dressing. Cut leaves into smaller pieces. Blend several leaves. Number of Domestic Cigarette Manufacturing Factories FY29 FY21 FY211 FY212 FY213 FY214 FY215 Domestic Cigarette Manufacturing Factories Tobacco Manufacturing-related Factory Location (As of December 31, 215) FACT SHEETS Cigarette manufacturing factories: 4 Other tobacco-related factories: 2 Kita-Kanto factory Tomobe factory Hiratsuka factory Tokai factory Kyushu factory Kansai factory Note: Hiratsuka factory is planned to be closed on March 31, 216. JAPAN TOBACCO INC. FACT SHEETS FY215 18

20 Tobacco Sales System Consumers sales direct sales JT requirement for the approval of retail price approval approval Retailers licensing requirement for selling approval The Minister of Finance requirement for the approval registration notification of retail price registration for the wholesale Wholesalers Registered Importers by way of wholesalers or direct sales imports registration requirement for registered importers Foreign Tobacco Number of Tobacco Retailers Thousands of stores (As of March 31) Tobacco Retailers Source: Ministry of Finance Number of Tobacco Vending Machines Thousands (As of December 31) Total Tobacco Vending Machines Source: Japan Vending Machine Manufacturers Association 19 JAPAN TOBACCO INC. FACT SHEETS FY215

21 Number of Tobacco Vending Machines (JT Tobacco Vending Machines) Thousands Dec Dec. 31 JT Tobacco Vending Machines Number of Domestic Tobacco Growers and Area under Domestic Leaf Tobacco Cultivation Thousands of growers Thousands of ha (As of March 31) Number of Domestic Tobacco Growers Area under Domestic Leaf Tobacco Cultivation Volume of Domestic and International Leaf Tobacco Purchase Thousands of tons FACT SHEETS 2 FY29 FY21 FY211 FY212 FY213 FY214 FY215 Domestic* International ** 52 * Results of period from April 1 through March 31 of the following year ** Results of January December Value of Domestic Leaf Tobacco Purchase and Price per 1 kg Yen 2, 1,5 1, 5 (As of March 31) Amount Price per 1 kg 1,859 1,849 1,865 1,957 1,98 1,969 1,974 JAPAN TOBACCO INC. FACT SHEETS FY215 2

22 Number of Employees/Subsidiaries and Affiliates Number of Employees Employees 6, 45, 3, 15, Dec Dec. 31 Total 47,977 49,665 48,472 48,529 49,57 51,563 51,341 44,485 Tobacco Business International 23,227 24,751 23,92 24,237 24,397 26,731 25,829 26,2 Japanese Domestic 11,281 11,282 11,191 11,92 11,43 11,22 11,648 9,47 Pharmaceutical Business 1,616 1,634 1,664 1,693 1,744 1,787 1,84 1,839 Food Business 1,975 11,143 1,864 1,646 Beverage Business 4,912 5,35 5,122 Processed Food Business 6,563 6,96 5,968 5,798 Other Business Corporate ,178 Note: Number of employees is counted at working basis, unless otherwise indicated Dec Dec. 31 Number of Employees (parent company) 8,98 8,961 8,928 8,936 8,925 8,774 8,915 7,549 Number of Employees Based on Enrollment (parent company) 9,973 9,883 9,842 9,824 9,782 9,628 9,84 8,194 Note: The number of employees in the international tobacco business is calculated based on the number of employees as of December 31 of each year. Status of Subsidiaries and Affiliates (As of December 31, 215) Name Location Capital (Millions of yen) Principal business Holding rate of voting rights (%) TS Network Co., Ltd. Taito-ku, Tokyo 46 Japanese domestic tobacco 74.5 JT Logistics Co., Ltd. Shibuya-ku, Tokyo 27 Japanese domestic tobacco 1 Japan Filter Technology Co., Ltd. Shibuya-ku, Tokyo 461 Japanese domestic tobacco 88.6 Fuji Flavor Co., Ltd. Hamura-shi, Tokyo 196 Japanese domestic tobacco 1 JT Engineering Inc. Sumida-ku, Tokyo 2 Japanese domestic tobacco 1 JT International Group Holding B.V. Netherlands thousands USD 1,8,372 International tobacco 1 JT International Holding B.V. Netherlands thousands USD 1,8,372 International tobacco 1 (1) JT International S.A. Switzerland thousands CHF 1,215,425 International tobacco 1 (1) Gallaher Ltd. U.K. thousands GBP 172,495 International tobacco 1 (1) LLC JTI Russia Russia thousands RUB 18,7 International tobacco 1 (1) LLC Petro Russia thousands RUB 328,439 International tobacco 1 (1) JTI Polska Sp. z o. o. Poland thousands PLN 2, International tobacco 1 (1) JT International Germany GmbH Germany thousands EUR 37,394 International tobacco 1 (1) JTI Tütün Urunleri Sanayi A.S. Turkey thousands TRY 148,825 International tobacco 1 (1) Torii Pharmaceutical Co., Ltd. Chuo-ku, Tokyo 5,19 Pharmaceutical 54.5 Akros Pharma Inc. U.S.A. thousands USD 1 Pharmaceutical 1 (1) TableMark Holdings Co., Ltd. Chuo-ku, Tokyo 47,53 Processed food 1 TableMark Co., Ltd. Chuo-ku, Tokyo 22,5 Processed food 1 (1) Notes: In addition to the above, JT has 176 consolidated subsidiaries and 12 companies accounted for by the equity method. The figures in parentheses in the Holding rate of voting rights column are indirect holding rates included in the figures outside the parentheses. 21 JAPAN TOBACCO INC. FACT SHEETS FY215

23 Glossary FY214 (Reported basis) Like-for-Like (L-f-L) basis Adjusted Net Sales Excluding Excise Taxes Results of twelve-month period from January 1 to December 31, 214 for the international business and results of nine-month period from April 1 to December 31, 214 for the Japanese domestic businesses. For the purpose of fair comparison of business performance, results of twelve-month period with regard to all business segments in continuing operations from January 1 to December 31, 214, in comparison to the results of fiscal year ended December 31, 215, were disclosed for reference. Excludes the imported tobacco, domestic duty free, the China Division and other peripheral businesses in the Japanese domestic tobacco business. Excludes the distribution, contract manufacturing and other peripheral businesses in the international tobacco business. Core Revenue Excludes revenue from distribution of imported tobacco in the Japanese Domestic Tobacco Business, among others. Includes revenue from waterpipe tobacco products and emerging products, but excludes revenues from distribution, contract manufacturing and other peripheral businesses in the International Tobacco Business. EBITDA Adjusted EBITDA Operating income + depreciation and amortization Operating profit + depreciation and amortization + adjustment items (income and costs)* * Adjustment items (income and costs) = impairment losses on goodwill ± restructuring income and costs ± others Adjusted Operating Profit Operating profit + amortization of acquired intangibles + adjustment items (income and costs)* ROA FCF * Adjustment items (income and costs) = impairment losses on goodwill ± restructuring income and costs ± others JGAAP: ROA = (Ordinary income) / Total assets [average of beginning and ending balance for the period] : ROA = (Profit before income taxes) / Total assets [average of beginning and ending balance for the period] FCF is the sum of cash flows from operating activities and investing activities, but excludes the following items; From operating CF: interest received, dividends received, interest paid and income taxes related to these items From investing CF: purchase of investment securities (for both short-term and long-term), payments into time deposits, proceeds from sale or redemption of investment securities (for both short-term and long-term), proceeds from withdrawal of time deposits and other investing activities not for business operation purposes FACT SHEETS Depreciation & Amortization JGAAP: Depreciation of Tangible Fixed Assets + Amortization of Intangible Fixed Assets + Amortization of Long-Term Prepaid Expenses + Amortization of Goodwill : Depreciation of tangible fixed assets + Amortization of intangible fixed assets Liquidity Interest-Bearing Debt Interest Coverage Ratio Cash and deposits + Marketable securities + Securities purchased under repurchase agreements Short-term bank loans + CP + bonds + long-term borrowings + lease obligations JGAAP: Interest Coverage Ratio = Cash flow from operating activities / Interest expenses* : Interest Coverage Ratio = Cash flow from operating activities / Interest paid** * Amount on Income Statement ** Amount on Cash Flow Statement Total Shipment Volume (International Tobacco Business) Includes fine cut, cigars, pipe tobacco and snus but excludes contract manufactured products, waterpipe tobacco products and emerging products. In FY27, cigars, pipe and snus were not included in total shipment volume. GFB (Global Flagship Brand) (International Tobacco Business) GFB after FY26: Winston, Camel, Mild Seven/MEVIUS, LD, Benson & Hedges, Silk Cut, Sobranie, Glamour JAPAN TOBACCO INC. FACT SHEETS FY215 22