JTI at a glance
The JT Group
Our parent company
• JT was established in 1985
Japanese domestic tobacco
• In 1999 JT becomes global with the
purchase of the international operations
of R.J. Reynolds
Beverages
• JT Group includes Japan’s domestic
tobacco market, as well as beverages,
seasonings, processed foods and
pharmaceutical businesses
Processed foods
• A global Fortune 500 company*
• Over 51,000 employees worldwide,
including JTI
Pharmaceuticals
• 33.3% owned by the Japanese government,
making it the largest shareholder
*2013
© Copyright JTI 2013
JTI at a glance
2
JTI today
• JTI is the JT Group’s
international tobacco
business
364
• We employ people in 73
countries around the world
25
• We are a leading
international tobacco product
company created in 1999
• We sold 416.4 billion
cigarettes
2
• The Company’s core
revenue is USD 12,273
million
2
offices
27,000
employees (approx.)
1
factories
8
research &
development centers
5
tobacco processing
facilities
1 As of December 2013
2 Jan-Dec 2013
© Copyright JTI 2013
JTI at a glance
3
Our Global Flagship Brand portfolio
A portfolio strongly represented across most price segments
JTI at a glance
4
Our ‘Other Tobacco Products’ and ‘Emerging Products’
Roll-your-own, make-your-own
Cigars
Snus
Ploom
Shisha
Electronically heated tobacco
product that heats tobacco
pods to create vapor
JTI at a glance
5
JTI in Serbia
Investment case
JTI: the first and biggest Japanese investor in Serbia
2003
2006
- JTI opens the
marketing and sales office in Belgrade
- JTI acquires
Tobacco Industry Senta - today
JT International a.d. Senta
Initial investment of USD 45 million
USD 169
million JTI invested so far in Serbia.
Why investing in Serbia?
Key rationale
•
Supplying promising markets of Serbia and West Balkans
Importance of CEFTA
•
Free-trade agreement between Serbia, Montenegro, Bosnia & Herzegovina, Albania, (UN Mission in)
Kosovo, Macedonia, and Moldova
•
Provides 0% customs duty for our exports to Macedonia, Montenegro and Bosnia and Herzegovina
EU trade liberalization
•
Preferable customs rates for import of various goods from Serbia envisaged in Stabilization and
Association Agreement
JTI exports from Serbia
•
Cigarettes to Bosnia and Herzegovina, Montenegro, Macedonia, Croatia and Albania
•
Serbian-grown tobacco to the EU
•
Total export of cigarettes and tobacco in 2013 worth USD
23,4 million
8
JTI in Serbia production base for the Western Balkans
7 markets – one EU member and 6 CEFTA parties
Senta
factory
*
•
Factory in Senta
•
West Balkan’s headquarters in Belgrade
•
Offices in Bosnia and Herzegovina,
Croatia, Albania and Kosovo
*The map is without prejudice to positions on status, and is in line with UNSC 1244 and the ICJ Opinion on the Kosovo declaration of independence.
JTI: tax contributor in Serbia
JTI is the
13.6
th
6
largest taxpayer in the country
billion dinars contributed to the state budget in 2013.
10
JTI growth story
50% despite significant market contraction
•
Sales volume in Serbia increased by
•
JTI’s share of market in Serbia increased by over
25.0
100% since 2006
JTI Senta export growth
21.2
20.0
17.6
23.4
21.8
18.5
15.0
9.8
10.0
5.0
3.8
2.3
0.0
2006
2007
2008
Leaf
2009
Cigarettes
2010
Total
2011
2012
2013 Expected
Tobacco growing operations in Serbia
• JTI - a leader in tobacco production in Serbia with market share of
43% in ’12
• JTI cooperates in Serbia with 250 seasonal workers and 180 farmers
• Continuous growth of tobacco production and total yield per hectare
50% increased tobacco purchase
•
Over
•
80% increase in contracted tobacco
12
Employees – Wheel of our Growth
• Today JTI in Serbia employs over 300
people
• From 2006-2013 JTI generated 200 new jobs
• Engages over 250
seasonal workers
• Internships programs for graduated students (2010 – 2014) - 34 interns
• Skillful and well educated (mostly English-speaking) workforce
Kaizen
•
Senta factory is first in Serbia to implement Kaizen management process
•
Fully accepted by the employees
•
Productivity increased by 52%
•
Reject ratio reduced by 66%.
•
Factory certificated: ISO 9001:2008, ISO 14001:2004, OHSAS 18001:2007
14
Business Environment in Serbia
• Continuous dialog with the Government
• Communication maintained on all key aspects of economic legislation development
• Investor-friendly tax regime
• Salary tax rate -10% and corporate profit tax rate – 15%, among the lowest in the
Europe
• National treatment of foreign investors
• Serbia’s EU aspirations influencing regulatory environment that is heading towards
alignment with EU
• Predictable development of operating environment (e.g. excise calendar in tobacco
industry)
Conclusion
• The investment in Serbia proved to be good platform for business expansion of JTI in
Serbia and Adriatica region
15
Enterprising
Open
Challenging