Discover JTI an Induction Guide to Help You Understand How We Operate and Deliver Our Business Success
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Home JTI today JTI history Brands and products Fundamentals Leading Functions Going forward Discover JTI An induction guide to help you understand how we operate and deliver our business success Introduction them and re-investing in their development, we can continue to grow and expand our business. With the help of your manager, we will support your aspirations with continuous training and career development opportunities around the world. You will soon discover that we challenge each other in everything we do, every day but that ultimately, your ambition, innovation and your loyalty will be rewarded. This induction guide will help you to settle Dear Colleague, into your new role and allow you to discover who we are, what we do and how we do it. Welcome to JTI. I am delighted that you As well as giving headline facts and figures have chosen to join such an exciting and in about our business, our brands and our many ways unique company. structure, you’ll learn more about the principles that steer us. Don’t worry if the You are now part of an organization of guide doesn’t answer all your questions; 40,000 employees, from 110 nationalities help is always at hand – so feel free to ask. and working across 77 countries(1). One thing you’ll discover about JTI is Since our creation in 1999, significant that people enjoy working together and changes have turned us into a genuinely supporting each other. We are one team. international company. We are extremely proud of our rich heritage and diverse I wish you an enjoyable, rewarding and workforce, which is key to ensure long- long-lasting career with JTI. term success of the Company, driving innovation and creativity. Each country and person in our network has an important part to play in our continued success. It is why we strongly encourage every individual to bring fresh ideas, challenge the status quo and perform at their best. Howard Parks Senior Vice President, Human Resources Employees are our single biggest investors and I am confident that by nurturing (1) Numbers correct as of December 2017 Table of contents Introduction Leading __ Our leadership JTI today __ Governing the business __ JTI milestones __ JTI facts and figures Functions __ A structure that works JTI history __ Marketing & Sales __ Global Supply Chain Brands and products __ Human Resources __ Our brands are the signatures of success __ Finance __ Flagship Brands __ Legal & Regulatory Affairs __ Roll Your Own and Make Your Own __ Information Technology (RYO/MYO) __ Research & Development __ Other Tobacco Products (OTP) __ Corporate Strategy __ Reduced-Risk Products __ Reduced-Risk Products __ The story from seed to pack __ Business Development __ Corporate Development Fundamentals __ A company with a clear vision Going forward __ Our values __ Employee experience at JTI __ Core behaviors __ 4S management principle __ Our strategies __ Our sustainability efforts __ Our core principles Home JTI today JTI history Brands and products Fundamentals Leading Functions Going forward JTI today New JTI headquarters in Geneva, Switzerland JTI today The facts and milestones that make us who we are JTI milestones Closer to industry roots Our brand heritage goes back to the 18th In 2009, the JT Group acquired part of the century. However, we are a relatively young worldwide business of Tribac Leaf Limited company in the global tobacco industry, (a company that trades tobacco in Africa) as where east meets west and experience well as the two Brazilian companies active in supports innovation. the tobacco business, Kannenberg (a tobacco producer) and KBH&C (a company that Where we come from processes and sells Kannenberg products); it also set up a joint venture with two leaf Our company was formed in 1999 when suppliers in the US (Hail & Cotton Inc and JEB Japan Tobacco Inc. purchased the International). These acquisitions reflected the international tobacco operations of the strategic importance of ensuring adequate US multinational R.J. Reynolds for supplies of high quality leaf products to support USD 7.8 billion, creating a new company: the Company’s business growth ambitions. JTI – Japan Tobacco International. Broadening our earnings base A major acquisition Since 2009, we have regularly broadened In 2007, Gallaher, a FTSE 100 business, was our earnings base to ensure future sustainable acquired by Japan Tobacco Inc. for GBP growth through organic expansion and 9.4 billion, doubling our combined employee acquisitions. These acquisitions were population. At the time, this was the largest performed both in the traditional combustible foreign acquisition by a Japanese company. area and Reduced-Risk Products category. And we will continue to do so to reach our Flagship Brands ambition to be the #1 international tobacco company. In 2007, JTI launched its new Flagship Brand portfolio, with a key focus on investment in brand equity, product quality and geographical coverage. JTI facts and figures Japan Tobacco International (JTI) is a • Adjusted operating profit(3) at constant member of the Japan Tobacco Group of currency reached USD 3,219 million, Companies (JT), a leading international growing by 4% vs the previous year. tobacco manufacturer. JTI’s headquarters On a reported basis, adjusted operating are located in Geneva, Switzerland. profit grew 1.4% to USD 3,138 million due to currency fluctuations. Our numbers at the end of 2017 • Since 2009, we have reduced our • JTI employs approximately 40,000 environmental impact by cutting (4) people in 77 countries. emissions of CO2 by 15% , reducing energy consumption by 8%(5), reducing • JTI has 400 offices, 27 factories, 5 R&D water consumption by 6% and centers and 5 tobacco processing facilities reducing waste by 24%. around the world. • We have reduced injury rates across • Our products are distributed in JTI manufacturing and market operations 130 countries. by 24%(6) and are committed to providing a safe workplace for our employees. • JTI is a true multinational company, with more than 110 nationalities globally, • We are the profit growth engine of the 69 nationalities in the Geneva Japan Tobacco Group, and generated headquarters, and 12 nationalities among 81% of the Group’s volume and 60% our 16 Executive Committee members. of its adjusted operating profit in 2017. • JTI sold 398.5 billion cigarette equivalent units(1) and generated USD 10,498 million in core revenue(2) on a reported basis or USD 10,457 million at constant currency. (1) Including fine cut, cigars, pipe tobacco and snus but excluding waterpipe tobacco and Reduced-Risk Products as well as contract manufactured products (2) Including revenue from waterpipe tobacco and Reduced-Risk Products, but excluding revenues from distribution, contract manufacturing and other peripheral businesses (3) Adjusted operating profit = operating (4) profit + amortization cost of acquired intangibles + adjustment items (income and costs)* Emissions of CO2 associated with our operations– for example, resulting from the use of electricity or fuels in our offices, factories and vehicles (5) Includes energy from renewable and non-renewable sources, for example, electricity, gas, fuel, heat and steam (6) Lost Time Injury Rate versus 2014 * Adjustment items (income and costs) = impairment losses on goodwill ± restructuring income and costs ± others. Home JTI today JTI history Brands and products Fundamentals Leading Functions Going forward JTI history Tobacco plants, Zambia JTI history JTI was formed in 1999 but our tobacco experience and rich heritage dates back to the 18th century. Timeline 2017 Additional share purchase from the Ethiopian government of approximately 30% of the total shares in National Tobacco Enterprises, bringing our overall ownership to over 70% A kretek cigarette company, PT. Karyadibya Mahardhika and its distributor, PT. Surya Mustika Nusantara in Indonesia are acquired The assets related to the tobacco business of Mighty in the Philippines are acquired 2016 Acquisition of BIS Overseas Bolivia S.R.L., the second largest tobacco-specific distributor in the market Acquisition of 40% shares of National Tobacco Enterprise Ethiopia S.C, the Ethiopian state tobacco company Purchase of a 50% stake in La Tabacalera in the Dominican Republic The international business of Natural American Spirit, leading premium additive-free, whole leaf and organic brand, is acquired 2015 Brazilian distributor Fluxo is acquired Arian Tobacco Industries in Iran is acquired Logic, the leading independent US e-cigarette company, is acquired Worldwide rights to commercialize Ploom-branded tobacco pods and vaporization devices are acquired 2014 E-Lites, the UK’s most popular e-cigarette brand, is acquired 2013 Renaming of Mild Seven to Mevius The JT Group acquires a 20% stake in Megapolis, Russia’s leading tobacco distributor Ploom, a heated tobacco product based on vaporization technology, is launched Acquisition of Al Nakhla, an Egypt-based waterpipe tobacco manufacturer 2012 Acquisition of Gryson NV (a leading roll your own, make your own European tobacco company) 2011 Acquisition of Haggar Cigarette & Tobacco Factory Ltd in Sudan JTI enters into a strategic partnership with Ploom to develop an innovative new tobacco product 2009 Acquisition of Tribac, Kannenberg and KBH&C leaf sourcing businesses and set up of joint venture with Hail & Cotton and JEB International 2007 Acquisition of Gallaher, a FTSE 100 business 2006 Acquisition of AD Duvanska Industrija Senta in Serbia 2005 Acquisition of CRES Neva Ltd. (Russia) Glamour launched (Russia, Ukraine, Kazakhstan) 2001 Gallaher acquires Austria Tabak 2000 Gallaher acquires Liggett-Ducat factory (Russia) 1999 JT acquires non-U.S. operations of R.J. Reynolds LD launched (Russia) 1996 Acquisition of Tanzanian tobacco production facility 1995 Peter I launched (Russia) 1994 JT is listed on the Tokyo, Osaka and Nagoya stock exchanges Acquisition of Yelets (Russia) 1993 Acquisition of Kremenchuk (Ukraine) 1992 Acquisition of Manchester Tobacco Company Ltd.