Poland Market Survey Report Empty Discarded Pack Collection August/September 2016 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 08.08 24.08.2016 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 Gdansk Braniewo Lidzbark Warminski Olecko Suwalki Gryfice Koszalin Pomorskie Tczew Starogard Gdanski Elblag Warmiòsko-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 4
All Packs Collected Incidence of Non-domestic Packs Non-Domestic 16.4% Includes 3,1% of Domestic 83.6% N= 342,494 weighted sticks 8
All Packs Collected Non-domestic Packs Incidence Evolution 100% Includes 2,7% of Includes 2,2% of Includes 2,2% of Includes 2,5% of Includes 1,7% of Includes 2,6% of Includes 2,5% of Includes 1,6% of Includes 3,1% of 90% 14.5% 15.4% 17.0% 17.3% 19.0% 17.8% 18.2% 17.2% 16.4% 80% 70% 60% 50% 40% 30% 85.5% 84.6% 83.6% 83.0% 82.7% 81.0% 82.2% 81.8% 82.8% 20% 10% 0% Q4 2013 Q2 2014 Q3 2014 Q4 2014 Q2 2015 Q3 2015 Q4 2015 Q2 2016 Q3 2016 N= 345,161 N= 344,876 N= 344,256 N= 343,885 N= 343,132 N= 343,800 Figures are given in weighted sticks. Domestic Packs Non-domestic Packs N= 343,423 N= 342,488 9 N= 342,494
Incidence of Non-domestic Packs by Nielsen Region Poland national incidence of non-domestic packs: 16.4% 5,5% 41,3% 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% 2,7% 7,5% Warsaw 25,4%* 21,8%* 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. 2014 Warsaw 26.9% Central 24.9% East 39.8% North 6.1% South 13.0% South-East 16.7% South-West 10.0% West 2.8% 12,7% Q.4. 2015 Warsaw 27.8% Central 23.9% East 43.3% North 7.0% South 16.1% South-East 16.0% South-West 7.4% West 2.4% 15,2% 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.2. 2015 Warsaw 32.7% Central 19.6% East 49.1% North 5.9% South 14.1% South-East 17.3% South-West 3.9% West 10.2% Q.3. 2015 Warsaw 28.0% Central 21.5% East 35.2% North 7.0% South 17.6% South-East 20.4% South-West 6.0% West 2.8% 18 All data: calculated in cigarettes (single) weighted by localization populations and smoking incidence
Incidence of Non-domestic Packs by City Poland national incidence of non-domestic packs: 16.4% Largest 40 cities N= 342,494 weighted sticks Koszalin (7,2%) Gdynia (2,2%) Gdańsk (0,8%) Elbląg (60,0%) Olsztyn (48,4%) Small Towns Szczecin (4,2%) Gorzów Wielkopolski (8,3%) Zielona Góra (10,2%) Legnica (2,0%) Wałbrzych (6,6%) Poznań (0,5%) Wrocław (8,8%) Bydgoszcz (8,9%) Opole (5,6%) Toruń (7,5%) Kalisz (0,0%) Włocławek (7,2%) Łódź (20,0%) Częstochowa (17,9%) Zabrze (11,4%) Rybnik Gliwice (10,6%) (18,0%) Katowice (8,8%) Sosnowiec Chorzow (12,6%) Bytom (7,3%) Tychy (12,3%) (9,3%) Ruda Śląska (16,6%) Grudziądz (21,3%) Bielsko Biała (11,4%) Płock (37,1%) Dąbrowa Górnicza (16,0%) Kraków (10,2%) Warszawa (25,4%) Radom (17,5%) Kielce (13,1%) Tarnów (19,3%) Rzeszów (31,9%) Białystok (34,0%) Lublin (37,0%) REGION CITY INCIDENCE East Sokółka 49,1% Braniewo 77,3% Lidzbark Warmiński 68,5% Krasnystaw 17,9% Hrubieszów 26,0% Olecko 37,2% Radzyń Podlaski 23,9% South-East Nisko 29,3% Jasło 14,6% Ropczyce 30,6% Przeworsk 28,0% Łańcut 21,3% Jędrzejów 7,9% Staszów 14,6% Central Radomsko 29,1% Łask 17,8% Milanówek 17,9% Kozienice 30,5% Sokołów Podlaski 23,1% West Międzyrzecz 7,2% Złotów 0,0% Oborniki 0,7% Szamotuły 0,0% Chodzież 0,0% South-West Złotoryja 8,0% Strzelce Opolskie 10,6% Krapkowice 4,6% Bogatynia 12,7% Namysłów 6,6% North Gryfice 3,3% 19
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% 16.4% 16.2% 21.6% N= 342,494 weighted sticks 50.0% Non-domestic 40.0% 83.6% 83.8% 78.4% 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= 342,494 N= 325,951 N= 16,544 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 1.3% 54.4% Podlaskie 34.9% 4.8% Kujawsko-Pomorskie Belarus 9.8% Mazowieckie 25.2% Germany Lubuskie 9.1% Wielkopolskie 0.4% Lodzkie 25.4% Poland 20.5% Warsaw Lubelskie 35.0% >30% >15% <30% Czech Republic Dolnoslaskie 7.8% Opolskie 6.1% Slaskie 12.7% Swietokrzy skie Malopolskie 11.4% 12.9% Podkarpackie 28.6% Ukraine >2% <15% < 2% Slovakia (*): Mazowieckie including Warsaw N= 342,494 weighted sticks 21
Non-domestic Incidence by Voivodship N= 342,494 weighted sticks Q4 2013 Q2 2014 Q3 2014 Q4 2014 Q2 2015 Q3 2015 Q4 2015 Q2 2016 Q3 2016 WARSAW 21.3% 21.6% 21.9% 26.9% 32.7% 28.0% 27.8% 26.8% 25.4% Voivodships WARMINSKO-MAZURSKIE 33.0% 61.6% 59.4% 43.7% 70.3% 40.1% 63.6% 58.3% 54.4% LUBELSKIE 22.3% 30.3% 37.5% 33.8% 35.2% 28.7% 30.8% 38.5% 35.0% PODLASKIE 30.3% 41.7% 44.2% 43.0% 43.3% 38.1% 36.8% 36.3% 34.9% PODKARPACKIE 40.3% 29.8% 27.2% 25.6% 29.2% 34.1% 33.8% 30.9% 28.6% MAZOWIECKIE 21.6% 21.2% 23.8% 26.3% 30.4% 28.1% 27.6% 25.7% 25.2% LODZKIE 21.2% 23.1% 23.5% 25.3% 19.1% 18.0% 22.4% 21.2% 20.5% SWIETOKRZYSKIE 9.8% 3.9% 11.7% 9.1% 9.2% 7.4% 6.0% 11.8% 12.9% SLASKIE 11.7% 9.4% 13.0% 13.0% 14.1% 17.6% 16.1% 16.3% 12.7% MALOPOLSKIE 14.2% 13.7% 8.2% 15.9% 15.6% 19.3% 12.8% 4.7% 11.4% KUJAWSKO-POMORSKIE 9.9% 12.3% 14.6% 10.2% 11.6% 15.7% 12.4% 7.5% 9.8% LUBUSKIE 4.3% 2.5% 7.6% 4.6% 8.3% 5.1% 6.9% 7.3% 9.1% DOLNOSLASKIE 5.9% 7.1% 6.6% 10.0% 3.7% 6.0% 7.5% 6.0% 7.8% OPOLSKIE 2.1% 2.1% 4.4% 10.2% 4.6% 5.8% 6.9% 6.7% 6.1% ZACHODNIOPOMORSKIE 7.0% 6.7% 6.6% 5.8% 5.3% 3.0% 7.9% 10.9% 4.8% POMORSKIE 4.8% 0.0% 0.9% 1.8% 0.1% 0.6% 0.4% 2.4% 1.3% WIELKOPOLSKIE 1.9% 0.7% 2.7% 2.1% 10.8% 1.9% 0.8% 0.0% 0.4% Total Poland 14.5% 15.4% 17.0% 17.3% 19.0% 17.8% 18.2% 17.2% 16.4% (*): Mazowieckie including Warsaw 22
Non-domestic Incidence by Voivodship N= 342,494 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 16,4% includes 3.1% of counterfeit ALMARES CF Incidence by Voivodship Russia Lithuania Pomorskie Warmiòsko-Mazurskie Zachodniopomorskie 0.0% 10.6% Podlaskie 0.8% Kujawsko-Pomorskie 0.3% Belarus 1.7% Mazowieckie Germany Lubuskie 1.8% Wielkopolskie 0.1% Dolnoslaskie 6.8% Lodzkie Poland 4.7% Swietokrzy skie Lubelskie 0.5% 1.4% Opolskie Slaskie 1.7% >30% >15% <30% Czech Republic 0.5% 2.4% Malopolskie 3.3% Podkarpackie 2.4% Ukraine >2% <15% < 2% Slovakia (*): Mazowieckie including Warsaw N= 342,494 weighted sticks 24