Japan Tobacco International (JTI) business results for January - September 2010

Highlights

• The total shipment volume and GFB shipment volume increased by 4.8% and 9.4%, respectively in the period July-September. These strong quarterly increases resulted from growth and prior year trade inventory adjustments in the Middle East and Turkey, improved shipment volume in Russia and continued growth in Italy and France.

• Market share continued to grow in most key markets including Turkey, Italy, France and Russia.

• Core net sales excluding tax grew by 5.8% in July-September, primarily driven by pricing and volume increases. At constant rates of exchange, core net sales excluding tax increased by 8.9%.

• Core net sales per thousand cigarettes excluding tax was US$23.0 in July-September. At constant rates of exchange, core net sales per thousand cigarettes excluding tax increased by 3.9% during the same period.

Shipment Volume by Cluster

• South and West Europe: Total shipment volume improved 2.3% in July-September (Jan-Sep 2010: -3.4%) compared to the same period last year. A reduction in shipment volume in Greece due to industry contraction was more than offset by strong growth in Italy and France. GFB volume increased by 4.0% during the same period (Jan-Sep 2010:-2.0%). Market share increased in all key markets i.e. Italy, France and Spain.

• North and Central Europe: Total shipment volume remained flat at -0.5% in July-September (Jan-Sep 2010: 3.3%). Whilst shipment volume increased in Sweden, higher trade inventories in the United Kingdom offset our brands’ growth momentum there. GFB volume increased 4.5% in July-September (Jan-Sep 2010: 10.3%).

• CIS+: Total shipment volume increased 0.8% in July-September (Jan-Sep 2010: -5.1%) due to volume improvement in Russia which offset industry contraction in Romania and lower shipment volume in Ukraine due to excise increases and industry contraction. GFB volume also increased 6.9% during the same period (Jan-Sep 2010: -1.0%). Market share grew in Russia from 36.5% to 37.0%.

• Rest-of-the-World: Total shipment volume increased 18.6% in July-September (Jan-Sep 2010: 3.2%). Volume increased as a result of growth and prior year trade inventory adjustments in the Middle East, Turkey and Taiwan. GFB volume increased 21.7% during the same period (Jan-Sep 2010: 5.9%). Market share increased in Turkey and Korea.