Poland Market Survey Report Empty Discarded Pack Collection October / November 2014 Conducted on behalf: British American Tobacco Imperial Tobacco Group Japan Tobacco International Philip Morris International Prepared by: ALMARES 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 17.10 14.11.2014 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 3
Sampling Plan Russia Lithuania Gdynia Suwalki Gdansk Braniewo Lidzbark Warminski Olecko Gryfice Koszalin Pomorskie Tczew Starogard Gdanski Elblag Warmiòsko-Mazurskie Olsztyn Elk Podlaskie Sokolka Germany Zachodniopomorskie Szczecin Stargard Szczecinski Pila Chodziez Gorzow Wielkopolski Oborniki Szamotuly Miedzyrzecz Poznan Lubuskie Wielkopolskie Czech Republic Grudziadz Lomza Ostroleka Zlotow Zielona Gora Leszno Kalisz Ostrow Wielkopolski Glogow Bogatynia Kujawsko-Pomorskie Torun Bydgoszcz Inowroclaw Wloclawek Plock Gniezno Kutno Lodzkie Poland Zgierz Lodz Pabianice Mazowieckie Sokolow Podlaski Legionowo Siedlce Warszawa Pruszkow Malopolskie Bielsko-Biala Nowy Sacz Bialystok Biala Podlaska Konin Radzyn Podlaski Milanowek Lubelskie Kozienice Pulawy Radom Lublin Chelm Krasnystaw Skarzysko-Kamienna Lubin Starachowice Dolnoslaskie Ostrowiec Swietokrzyski Radomsko Zamosc Legnica Swietokrzy skie Wroclaw Namyslow Zlotoryja Kielce Stalowa Wola Czestochowa Opolskie Jedrzejow Staszow Nisko Tarnobrzeg Jelenia Gora Swidnica Slaskie Walbrzych Opole Mielec Zawiercie Strzelce Opolskie Tarnowskie Gory Krapkowice Piekary Slaskie Lancut Przeworsk Kedzierzyn-Kozle Gliwice Bytom Dabrowa Gornicza Siemianowice Zabrze Bedzin Ropczyce Chorzow Slaskie Sosnowiec Ruda Swietochlowice Slaska Katowice Tarnow Rzeszow Tychy Myslowice Jaworzno Krakow Przemysl Raciborz Rybnik Zory Wodzislaw Slaski Jaslo Stupsk Lask Tomaszow Mazowiecki Piotrkow Trybunalski Belchatow Podkarpackie Belarus Hrubieszow Ukraine Slovakia 4
All Packs Collected Incidence of Non-domestic Packs Non-domestic 17,3% Includes 2,5% of Domestic 82,7% Q.4. 2014 N= 343,885 weighted sticks 8
All Packs Collected Non-domestic Packs Incidence Evolution 100% Includes 2,2% of Includes 1,7% of Includes 1,7% of Includes 2,6% of Includes 2,7% of Includes 2,2% of Includes 2,2% of Includes 2,5% of 90% 14,5% 13,2% 15,1% 14,0% 14,5% 15,4% 17,0% 17,3% 80% 70% 60% 50% 40% 85,5% 86,8% 84,9% 86,0% 85,5% 84,6% 83,0% 82,7% 30% 20% 10% 0% Q3 2012 Q4 2012 Q2 2013 Q3 2013 Q4 2013 Q2 2014 Q3 2014 Q4 2014 N= 346,915 N= 347,140 N= 346,270 N= 346,044 N= 345,161 N= 344,876 N= 344,256 N= 343,885 Figures are given in weighted sticks. Domestic Packs Non-domestic Packs 9
Incidence of Non-domestic Packs by Nielsen Region Q.4. 2014 Poland national incidence of non-domestic packs: 17.3% 6,1% 39,8% Q.3. 2012 Warsaw 24.7% Central 23.5% East 31.7% North 4.3% South 12.0% South-East 13.1% South-West 5.2% West 2.3% Q.4. 2012 Warsaw 20.6% Central 24.6% East 27.4% North 4.9% South 9.9% South-East 14.5% South-West 3.9% West 0.9% 2,8% 10,0% Warsaw 26,9%* 24,9%* Q.2. 2013 Warsaw 24.2% Central 21.6% East 45.4% North 4.4% South 10.2% South-East 10.1% South-West 7.8% West 2.4% Q.3. 2013 Warsaw 20.3% Central 19.9% East 36.5% North 8.0% South 10.1% South-East 12.1% South-West 5.2% West 2.3% 13,0% 16,7% Q.3. 2014 Warsaw 21.9% Central 26.3% East 46.7% North 7.7% South 13.0% South-East 12.7% South-West 6.2% West 3.9% Q.4. 2013 Warsaw 21.3% Central 21.8% East 28.1% North 7.4% South 11.7% South-East 18.7% South-West 5.3% West 2.6% Q.2. 2014 Warsaw 21.6% Central 22.1% East 43.9% North 6.4% South 9.4% South-East 15.3% South-West 6.3% West 1.2% 18 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: 17.3% Q.4. 2014 N= 343,885 weighted sticks Szczecin (6,1%) Gorzów Wielkopolski (5,3%) Zielona Góra (3,3%) Koszalin (5,3%) Legnica (14,5%) Wałbrzych (5,9%) Poznań (1,1%) Wrocław (9,8%) Gdynia (0,7%) Gdańsk (2,3%) Bydgoszcz (8,1%) Toruń (7,9%) Kalisz (6,5%) Elbląg (47,9%) Grudziądz (14,6%) Włocławek (17,1%) Łódź (25,7%) Częstochowa (20,5%) Opole Zabrze (10,6%) (11,3%) Rybnik Gliwice (7,9%) (12,7%) Ruda Śląska Katowice (16,8%) (8,1%) Sosnowiec Chorzow (7,5%) Bytom (19,8%) Tychy (15,6%) (13,7%) Bielsko Biała (8,9%) Płock (32,3%) Dąbrowa Górnicza (20,3%) Kraków (15,8%) Olsztyn (39,1%) Warszawa (26,9%) Radom (22,5%) Kielce (9,2%) Tarnów (16,5%) Rzeszów (26,3%) Białystok (40,8%) Lublin (34,1%) Small Towns REGION CITY INCIDENCE East Sokółka 77,20% Braniewo 76,50% Lidzbark Warmiński 42,40% Krasnystaw 38,60% Hrubieszów 31,10% Olecko 28,40% Radzyń Podlaski 24,60% South-East Nisko 27,60% Jasło 24,60% Ropczyce 24,50% Przeworsk 23,30% Łańcut 22,60% Jędrzejów 9,30% Staszów 7,90% Central Radomsko 22,50% Łask 19,40% Milanówek 15,00% Kozienice 9,30% Sokołów Podlaski 8,50% West Międzyrzecz 8,50% Złotów 5,90% Oborniki 3,30% Szamotuły 1,30% Chodzież 0,70% South-West Złotoryja 18,10% Strzelce Opolskie 15,20% Krapkowice 7,90% Bogatynia 7,90% Namysłów 4,00% North Gryfice 1,30% 19
Incidence of Non-domestic Packs Comparison of Results in Large Cities Vs. Results in Smaller Towns 100,0% Q.4. 2014 N= 343,885 weighted sticks 90,0% 80,0% 70,0% 60,0% 17,3% 17,1% 21,3% 50,0% Non-domestic 40,0% 82,7% 82,9% 78,7% Domestic 30,0% 20,0% 10,0% 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= 343,885 N= 327,275 N= 16,610 20
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 ALMARES Non-domestic Incidence by Voivodship Russia Lithuania Pomorskie Warmiòsko-Mazurskie Zachodniopomorskie 1.8% 43.7% Podlaskie 43.0% 5.8% Kujawsko-Pomorskie Belarus 10.2% Mazowieckie 26.3% Germany Lubuskie 4.6% Wielkopolskie 2.1% Lodzkie Poland 26.9% 25.3% Warsaw Lubelskie 33.8% >30% >15% <30% Czech Republic Dolnoslaskie 10.0% Opolskie 10.2% Slaskie 13.0% Swietokrzy skie Malopolskie 15.9% 9.1% Podkarpackie 25.6% Ukraine >2% <15% < 2% Slovakia (*): Mazowieckie including Warsaw Q.4. 2014 N= 343,885 weighted sticks 21
Non-domestic Incidence by Voivodship Q.4. 2014 N= 343,885 weighted sticks Q3 2012 Q4 2012 Q2 2013 Q3 2013 Q4 2013 Q2 2014 Q3 2014 Q4 2014 WARSAW 24,7% 20,6% 24,2% 20,3% 21,3% 21,6% 21,9% 26,9% Voivodships WARMINSKO-MAZURSKIE 32,30% 26,80% 59,00% 36,00% 33,00% 61,60% 59,40% 43,70% PODLASKIE 35,60% 38,10% 49,40% 44,20% 30,30% 41,70% 44,20% 43,00% LUBELSKIE 28,10% 19,60% 30,50% 31,10% 22,30% 30,30% 37,50% 33,80% MAZOWIECKIE 24,30% 20,50% 23,20% 20,10% 21,60% 21,20% 23,80% 26,30% PODKARPACKIE 26,90% 43,30% 21,50% 19,90% 40,30% 29,80% 27,20% 25,60% LODZKIE 24,00% 26,90% 22,80% 20,00% 21,20% 23,10% 23,50% 25,30% MALOPOLSKIE 10,80% 7,80% 8,70% 11,70% 14,20% 13,70% 8,20% 15,90% SLASKIE 12,00% 9,90% 10,20% 10,10% 11,70% 9,40% 13,00% 13,00% KUJAWSKO-POMORSKIE 7,20% 7,00% 8,50% 15,80% 9,90% 12,30% 14,60% 10,20% OPOLSKIE 3,60% 1,80% 7,20% 3,10% 2,10% 2,10% 4,40% 10,20% DOLNOSLASKIE 5,50% 4,30% 7,90% 5,60% 5,90% 7,10% 6,60% 10,00% SWIETOKRZYSKIE 5,10% 5,60% 1,70% 4,20% 9,80% 3,90% 11,70% 9,10% ZACHODNIOPOMORSKIE 2,30% 3,60% 4,00% 4,40% 7,00% 6,70% 6,60% 5,80% LUBUSKIE 6,90% 1,40% 4,50% 2,90% 4,30% 2,50% 7,60% 4,60% WIELKOPOLSKIE 0,60% 0,80% 1,70% 2,10% 1,90% 0,70% 2,70% 2,10% POMORSKIE 2,60% 3,70% 0,30% 2,20% 4,80% 0,00% 0,90% 1,80% Total Poland 14,5% 13,2% 15,1% 14,0% 14,5% 15,4% 17,0% 17,3% (*): Mazowieckie including Warsaw 22
Non-domestic Incidence by Voivodship Q.4. 2014 N= 343,885 weighted sticks (*): Mazowieckie including Warsaw >30% >15% <30% >2% <15% < 2% 23
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 17,3% includes 2.5% of counterfeit ALMARES CF Incidence by Voivodship Russia Lithuania Pomorskie Warmiòsko-Mazurskie Zachodniopomorskie 0.3% 0.3% Podlaskie 1.2% Kujawsko-Pomorskie 0.9% Belarus 1.4% Mazowieckie Germany Lubuskie 0.7% Wielkopolskie 0.1% Dolnoslaskie 5.2% Lodzkie Poland 2.7% Swietokrzy skie Lubelskie 5.6% 3.1% Opolskie Slaskie 1.7% >30% >15% <30% Czech Republic 2.1% 1.3% Malopolskie 3.4% Podkarpackie 5.5% Ukraine >2% <15% < 2% Slovakia (*): Mazowieckie including Warsaw Q.4. 2014 N= 343,885 weighted sticks 24