Poland Market Survey Report Empty Discarded Pack Collection October / November 2018 Conducted on behalf: British American Tobacco Imperial Tobacco Group Japan Tobacco International Philip Morris International Prepared by: Institute for Consulting and Market Research ul. Swietokrzyska 31/33a 00-049 Warszawa, Poland 1
Survey Methodology Empty Discarded Pack (EDP) collection Random collection from streets and public bins Any brand and market variant Total 70 cities (40 largest cities and 30 smaller towns) Target main sample: 17,000 packs City sample quotas proportional to population Fieldwork conducted 12.10 3.11.2018 Limitations Homes and workplaces are not covered No information on counterfeit incidence of non- products Caution The survey is designed to focus on trends rather than incidence at a single point in time 2
Sampling Plan Russia Lithuania Gdynia Gdansk Braniewo Lidzbark Warminski Olecko Suwalki Gryfice Koszalin Pomorskie Tczew Starogard Gdanski Elblag Warmiòsko-Mazurskie Warmińsko-Mazurskie Olsztyn Elk Podlaskie Sokolka Germany Zachodniopomorskie Szczecin Stargard Szczecinski Gorzow Wielkopolski Miedzyrzecz Lubuskie Wielkopolskie Czech Republic Bialystok Grudziadz Lomza Ostroleka Zlotow Stupsk Zielona Gora Leszno Kalisz Ostrow Wielkopolski Glogow Lubin Legnica Zlotoryja Pila Chodziez Oborniki Szamotuly Poznan Bogatynia Jelenia Gora Swidnica Walbrzych Dolnoslaskie Kujawsko-Pomorskie Torun Bydgoszcz Inowroclaw Wloclawek Plock Gniezno Kutno Konin Wroclaw Namyslow Opolskie Slaskie Lodzkie Poland Zgierz Lodz Pabianice Lask Tomaszow Mazowiecki Opole Zawiercie Strzelce Opolskie Tarnowskie Gory Krapkowice Piekary Slaskie Kedzierzyn-Kozle Gliwice Bytom Dabrowa Gornicza Siemianowice Zabrze Bedzin Chorzow Slaskie Sosnowiec Ruda Swietochlowice Slaska Katowice Tychy Myslowice Jaworzno Krakow Raciborz Rybnik Zory Wodzislaw Slaski Mazowieckie Sokolow Podlaski Legionowo Siedlce Biala Podlaska Warszawa Pruszkow Milanowek Piotrkow Trybunalski Belchatow Skarzysko-Kamienna Starachowice Ostrowiec Swietokrzyski Radomsko Swietokrzy skie Kielce Stalowa Wola Czestochowa Jedrzejow Staszow Nisko Tarnobrzeg Malopolskie Bielsko-Biala Nowy Sacz Lubelskie Kozienice Pulawy Radom Lublin Chelm Mielec Lancut Przeworsk Ropczyce Tarnow Rzeszow Przemysl Jaslo Radzyn Podlaski Podkarpackie Belarus Krasnystaw Hrubieszow Zamosc Ukraine Slovakia 3
All Packs Collected Incidence of Non-domestic Packs Non-Domestic 11,3% Includes 2,2% of Domestic 88,7% N= 341,761 weighted sticks 4
100% 90% Includes 1,6% of Includes 3,1% of Includes 2,2% of Includes 1,1% of Includes 2,8% of 17,2% 16,4% 14,3% 13,8% 15,7% All Packs Collected Non-domestic Packs Incidence Evolution Includes 1,8% of Includes 1,9% of Includes 2,4% of 12,7% 12,3% 11,4% 11,3% Includes 2,2% of 80% 70% 60% 50% 40% 82,8% 83,6% 85,7% 86,2% 84,3% 87,3% 87,7% 88,6% 88,7% 30% 20% 10% 0% Q2 2016 Q3 2016 Q4 2016 Q2 2017 Q3 2017 Q4 2017 Q2 2018 Q3 2018 Q4 2018 N= 342,488 N= 342,494 N= 342,366 Figures are given in weighted sticks. N= 342,198 N= 341,886 N= 342,261 N= 342,251 Domestic Packs Non-domestic Packs N= 341,842 N= 341,761 5
Incidence of Non-domestic Packs by Nielsen Region Poland national incidence of non-domestic packs: 11.3% 8,0% 21,5% Q.2. 2016 Warsaw 26.8% Central 21.2% East 44.3% North 6.6% South 16.3% South-East 11.3% South-West 6.1% West 1.9% Q.3. 2016 Warsaw 25.4% Central 21.8% East 41.3% North 5.5% South 12.7% South-East 15.2% South-West 7.5% West 2.7% 3,0% 8,9% Warsaw 14,6%* 12,1% Q.2. 2018 Warsaw 17.1% Central 19.6% East 25.7% North 7.1% South 10.3% South-East 6.9% South-West 8.3% West 3.2% 14,4%* 5,3% Q.3. 2018 Warsaw 12.3% Central 16.5% East 28.1% North 6.6% South 11.7% South-East 5.6% South-West 7.4% West 2.6% Q.4. 2016 Warsaw 21.9% Central 17.4% East 33.6% North 6.0% South 10.6% South-East 18.3% South-West 4.5% West 3.0% Q.3. 2017 Warsaw 25.6% Central 23.9% East 33.2% North 5.2% South 14.7% South-East 11.1% South-West 6.5% West 3.1% Q.2. 2017 Warsaw 19.9% Central 19.8% East 33.5% North 5.4% South 9.5% South-East 13.1% South-West 9.6% West 2.7% Q.4. 2017 Warsaw 21.6% Central 16.6% East 24.2% North 6.1% South 11.8% South-East 7.4% South-West 8.6% West 2.9% 6 All data: calculated in cigarettes (single) weighted by localization populations and smoking incidence
Incidence of Non-domestic Packs by City Largest 40 cities Poland national incidence of non-domestic packs: 11.3% N= 341,761 weighted sticks Koszalin (6,8%) Gdynia (4,7%) Gdańsk (8,2%) Elbląg (33,9%) Olsztyn (21,5%) Small Towns Szczecin (9,1%) Gorzów Wielkopolski (8,7%) Zielona Góra (6,7%) Legnica (8,0%) Wałbrzych (9,9%) Poznań (1,3%) Wrocław (10,7%) Bydgoszcz (10,5%) Opole (1,3%) Toruń (4,4%) Kalisz (1,3%) Ruda Śląska (16,7%) Włocławek (11,9%) Łódź (15,5%) Częstochowa (10,6%) Zabrze (11,8%) Rybnik Gliwice (9,3%) (11,0%) Katowice (12,5%) Sosnowiec Chorzow (16,1%) (12,6%) Tychy (14,5%) Bytom (10,6%) Grudziądz (6,6%) Bielsko Biała (6,4%) Płock (12,0%) Dąbrowa Górnicza (14,6%) Kraków (1,9%) Warszawa (14,6%) Radom (13,8%) Kielce (4,4%) Tarnów (1,3%) Rzeszów (18,5%) Białystok (30,7%) Lublin (10,0%) REGION CITY INCIDENCE East Sokółka 48,0% Braniewo 20,6% Lidzbark Warmiński 20,0% Krasnystaw 10,0% Hrubieszów 6,0% Olecko 19,3% Radzyń Podlaski 9,3% South-East Nisko 8,0% Jasło 11,3% Ropczyce 12,7% Przeworsk 18,0% Łańcut 10,0% Jędrzejów 4,0% Staszów 11,3% Central Radomsko 9,2% Łask 13,9% Milanówek 11,3% Kozienice 11,4% Sokołów Podlaski 17,3% West Międzyrzecz 8,3% Złotów 0,0% Oborniki 2,7% Szamotuły 0,0% Chodzież 2,2% South-West Złotoryja 4,6% Strzelce Opolskie 7,5% Krapkowice 5,0% Bogatynia 9,2% Namysłów 3,9% North Gryfice 4,0% 7
Incidence of Non-domestic Packs Comparison of Results in Large Cities Vs. Results in Smaller Towns 100,0% 90,0% 80,0% 70,0% 60,0% 11,3% 11,3% 10,9% N= 341,761 weighted sticks 50,0% 40,0% 30,0% 20,0% 10,0% 88,7% 88,7% 89,1% Non-domestic Domestic 0,0% 70 cities (40 largest cities + 30 smaller towns) Largest 40 cities 95,2% out of total 100% sample 30 smaller towns 4,8% out of total 100% sample N= 341,761 N= 325,219 N= 16,542 8
Szczeci n G r yf ice Stargard Szczecinski G orzow Wi el kopol ski Bogat ynia M iedzyr zecz Zielona Gora Jelenia Gora Koszal i n Zlot or yja G logow Lubin Legni ca Wal brzych Pila Szam ot uly Leszno Poznan Swidnica Chodziez O bor niki Zlot ow Wrocl aw G niezno G dyni a Bydgoszcz G dansk O st r ow Wielkopolski Nam yslow Starogard Gdanski I nowr oclaw Kal i sz Konin O pol e Kr apkowice Tczew G rudzi adz Torun Strzelce Opolskie Kedzier zyn- Kozle Racibor z Wl ocl aw ek Rybni k Wodzislaw Slaski El bl ag Kut no Tarnowskie Gory Czest ochow a Lodz Belchat ow Pl ock Dabrowa Gornicza Byt om Bedzin G l i wzabrze i ce Siemianowice Slaskie Chorzow Swiet ochlowice Sosnow i ec Ruda Slaska Kat ow i ce Zor y Lask Br aniewo Piekary Slaskie Zgier z Pabianice M yslowice Jawor zno Tychy Bi el sko- Bi al a Radom sko Piot r kow Tr ybunalski Zawier cie Lidzbark Warminski O l szt yn St upsk Tom aszow M azowiecki Krakow Pr uszkow Jedr zejow M ilanowek Legionowo Skar zysko- Kam ienna Ki el ce O st r oleka Warszaw a Radom St ar achowice Nowy Sacz Tarnow Lom za Elk Ostrowiec Swietokrzyski St aszow O lecko Kozienice M ielec Sokolow Podlaski Pulawy Tar nobr zeg Ropczyce Jaslo Siedlce Suwalki Stalowa Wola Rzeszow Bi al yst ok Radzyn Podlaski Nisko Lubl i n Lancut Sokolka Biala Podlaska Pr zewor sk Kr asnyst aw Pr zem ysl Zam osc Chelm Hr ubieszow Non-domestic Incidence by Voivodship Russia Lithuania Pomorskie Warmiòsko-Mazurskie Zachodniopomorskie 7.0% 25.7% Podlaskie 31.8% 8.5% Kujawsko-Pomorskie Belarus 8.6% Mazowieckie 14.3% Germany Lubuskie 7.7% Wielkopolskie 1.3% Lodzkie 14.6% Poland 15.1% Warsaw Lubelskie 9.8% >30% >15% <30% Czech Republic Dolnoslaskie 10.1% Opolskie 2.6% Slaskie 12.1% Swietokrzy skie Malopolskie 1.8% 4.9% Podkarpackie 16.1% Ukraine >2% <15% < 2% Slovakia (*): Mazowieckie including Warsaw N= 341,761 weighted sticks 9
Non-domestic Incidence by Voivodship N= 341,761 weighted sticks Q2 2016 Q3 2016 Q4 2016 Q2 2017 Q3 2017 Q4 2017 Q2 2018 Q3 2018 Q4 2018 WARSAW 26.8% 25.4% 21.9% 19.9% 25.6% 21.6% 17.1% 12.3% 14.6% Voivodships PODLASKIE 36.3% 34.9% 35.0% 34.3% 33.7% 30.6% 33.4% 37.2% 31.8% WARMIŃSKO-MAZURSKIE 58.3% 54.4% 27.3% 28.2% 35.2% 25.5% 32.2% 38.0% 25.7% PODKARPACKIE 30.9% 28.6% 27.0% 15.0% 27.6% 6.6% 17.2% 15.5% 16.1% LODZKIE 21.2% 20.5% 18.9% 16.6% 26.3% 16.2% 17.7% 16.7% 15.1% MAZOWIECKIE 25.7% 25.2% 20.5% 21.0% 24.4% 20.8% 18.3% 13.0% 14.3% SLASKIE 16.3% 12.7% 10.6% 9.5% 14.7% 11.8% 10.3% 11.7% 12.1% DOLNOSLASKIE 6.0% 7.8% 4.0% 10.4% 6.1% 9.6% 9.2% 8.2% 10.1% LUBELSKIE 38.5% 35.0% 38.0% 37.7% 31.1% 18.0% 13.9% 12.4% 9.8% KUJAWSKO-POMORSKIE 7.5% 9.8% 8.8% 7.8% 8.6% 10.4% 7.3% 6.8% 8.6% ZACHODNIOPOMORSKIE 10.9% 4.8% 8.8% 5.5% 5.4% 6.1% 5.2% 6.1% 8.5% LUBUSKIE 7.3% 9.1% 9.0% 9.6% 11.0% 10.2% 8.6% 8.0% 7.7% POMORSKIE 2.4% 1.3% 0.9% 2.7% 1.4% 1.4% 8.5% 6.8% 7.0% SWIETOKRZYSKIE 11.8% 12.9% 10.5% 12.7% 8.2% 9.2% 1.0% 5.6% 4.9% OPOLSKIE 6.7% 6.1% 7.0% 5.4% 8.7% 3.8% 3.3% 3.0% 2.6% MALOPOLSKIE 4.7% 11.4% 17.5% 12.6% 6.4% 7.2% 5.2% 2.3% 1.8% WIELKOPOLSKIE 0.0% 0.4% 0.9% 0.2% 0.2% 0.3% 1.2% 0.7% 1.3% Total Poland 17.2% 16.4% 14.3% 13.8% 15.7% 12.7% 12.3% 11.4% 11.3% (*): Mazowieckie including Warsaw 10
Non-domestic Incidence by Voivodship N= 341,761 weighted sticks Q2 2016 Q3 2016 Q4 2016 Q2 2017 Q3 2017 Q4 2017 Q2 2018 Q3 2018 Q4 2018 WARSAW 26.8% 25.4% 21.9% 19.9% 25.6% 21.6% 17.1% 12.3% 14.6% (*): Mazowieckie including Warsaw >30% >15% <30% >2% <15% < 2% Voivodships PODLASKIE 36.3% 34.9% 35.0% 34.3% 33.7% 30.6% 33.4% 37.2% 31.8% WARMIŃSKO-MAZURSKIE 58.3% 54.4% 27.3% 28.2% 35.2% 25.5% 32.2% 38.0% 25.7% PODKARPACKIE 30.9% 28.6% 27.0% 15.0% 27.6% 6.6% 17.2% 15.5% 16.1% LODZKIE 21.2% 20.5% 18.9% 16.6% 26.3% 16.2% 17.7% 16.7% 15.1% MAZOWIECKIE 25.7% 25.2% 20.5% 21.0% 24.4% 20.8% 18.3% 13.0% 14.3% SLASKIE 16.3% 12.7% 10.6% 9.5% 14.7% 11.8% 10.3% 11.7% 12.1% DOLNOSLASKIE 6.0% 7.8% 4.0% 10.4% 6.1% 9.6% 9.2% 8.2% 10.1% LUBELSKIE 38.5% 35.0% 38.0% 37.7% 31.1% 18.0% 13.9% 12.4% 9.8% KUJAWSKO-POMORSKIE 7.5% 9.8% 8.8% 7.8% 8.6% 10.4% 7.3% 6.8% 8.6% ZACHODNIOPOMORSKIE 10.9% 4.8% 8.8% 5.5% 5.4% 6.1% 5.2% 6.1% 8.5% LUBUSKIE 7.3% 9.1% 9.0% 9.6% 11.0% 10.2% 8.6% 8.0% 7.7% POMORSKIE 2.4% 1.3% 0.9% 2.7% 1.4% 1.4% 8.5% 6.8% 7.0% SWIETOKRZYSKIE 11.8% 12.9% 10.5% 12.7% 8.2% 9.2% 1.0% 5.6% 4.9% OPOLSKIE 6.7% 6.1% 7.0% 5.4% 8.7% 3.8% 3.3% 3.0% 2.6% MALOPOLSKIE 4.7% 11.4% 17.5% 12.6% 6.4% 7.2% 5.2% 2.3% 1.8% WIELKOPOLSKIE 0.0% 0.4% 0.9% 0.2% 0.2% 0.3% 1.2% 0.7% 1.3% Total Poland 17.2% 16.4% 14.3% 13.8% 15.7% 12.7% 12.3% 11.4% 11.3% 11
Szczeci n G r yf ice Stargard Szczecinski G orzow Wi el kopol ski Bogat ynia M iedzyr zecz Zielona Gora Jelenia Gora Koszal i n Zlot or yja G logow Lubin Legni ca Wal brzych Pila Szam ot uly Leszno Poznan Swidnica Chodziez O bor niki Zlot ow Wrocl aw G niezno G dyni a Bydgoszcz G dansk O st r ow Wielkopolski Nam yslow Starogard Gdanski I nowr oclaw Kal i sz Konin O pol e Kr apkowice Tczew G rudzi adz Torun Strzelce Opolskie Kedzier zyn- Kozle Racibor z Wl ocl aw ek Rybni k Wodzislaw Slaski El bl ag Kut no Tarnowskie Gory Czest ochow a Lodz Pl ock Dabrowa Gornicza Byt om Bedzin G l i wzabrze i ce Siemianowice Slaskie Chorzow Swiet ochlowice Sosnow i ec Ruda Slaska Kat ow i ce Zor y Lask Br aniewo Piekary Slaskie Zgier z Pabianice Belchat ow M yslowice Jawor zno Tychy Bi el sko- Bi al a Radom sko Piot r kow Tr ybunalski Zawier cie Lidzbark Warminski O l szt yn St upsk Tom aszow M azowiecki Krakow Pr uszkow Jedr zejow M ilanowek Legionowo Skar zysko- Kam ienna Ki el ce O st r oleka Warszaw a Radom St ar achowice Nowy Sacz Tarnow Lom za Elk Ostrowiec Swietokrzyski St aszow O lecko Kozienice M ielec Sokolow Podlaski Pulawy Tar nobr zeg Ropczyce Jaslo Siedlce Suwalki Stalowa Wola Rzeszow Bi al yst ok Radzyn Podlaski Nisko Lubl i n Lancut Sokolka Biala Podlaska Pr zewor sk Kr asnyst aw Pr zem ysl Zam osc Chelm Hr ubieszow non-domestic incidence 11,3% includes 2.2% of counterfeit CF Incidence by Voivodship Russia Lithuania Zachodniopomorskie Pomorskie 1.5% Warmińsko-Mazurskie Warmiòsko-Mazurskie 1.4% Podlaskie 1.2% Kujawsko-Pomorskie 0.1% Belarus 2.4% Mazowieckie Germany Lubuskie 1.9% Wielkopolskie 0.0% Dolnoslaskie 2.8% Lodzkie Poland 4.5% Swietokrzy skie Lubelskie 1.9% 2.6% Opolskie Slaskie 0.1% >30% >15% <30% Czech Republic 0.0% 3.6% Malopolskie 0.0% Podkarpackie 0.9% Ukraine >2% <15% < 2% Slovakia (*): Mazowieckie including Warsaw N= 341,761 weighted sticks 12