Japan Tobacco Inc. · TSE:2914
Japan Tobacco — Investor Presentation (September 2010)
24 slides from Japan Tobacco's investor presentation, Sep 28, 2010
Slide 1: JT International Investor Field Trip: Global Supply Chain
JT International Investor Field Trip Global Supply Chain St. Petersburg September 28, 2010
Slide 2: Forward-Looking and Cautionary Statements
Forward-Looking and Cautionary Statements This presentation contains forward-looking statements about our industry, business, plans and objectives, financial conditions and results of operations based on current expectations, assumptions, estimates and projections. These statements discuss future ex
Slide 3: Andrew Newton, CIS Manufacturing Vice President
Andrew Newton CIS Manufacturing Vice President 3
Slide 4: Agenda
Agenda Introduction Petro Factory JTI Strategy & Performance Conclusions 4
Slide 5: Introduction
- Introduction - 5
Slide 6: Supply chain process overview
Supply chain process overview Leaf & materials procurement Factory operations Tobacco growing: NTM and equipment: Primary: tobacco M&P: in-house filter > South America > Europe processing production > Africa > Asia Pacific, etc. Tobacco leaf NTM M&P: cigarette procurement: production & > Local packa
Slide 7: Cigarette manufacturing process overview
Cigarette manufacturing process overview Primary Making Packing NTM: NTM: > Cigarette paper > Aluminum foil Tobacco leaf: > Filter > Tax stamp > Virginia > Tipping paper > Inner frame > Burley > Blank > Oriental > Polypropylene > Tear tape > CRES(1) Tobacco blend > DIET(2) > RTS(3) Pack > Casing > F
Slide 8: Russia manufacturing footprint
Russia manufacturing footprint Petro Established in 1852 Cres Neva Products: cigarettes and papirosy Established in 1999 Volume: 88 BNU Products: CRES(1), DIET(2) Headcount: 1,750 Volume: 33,000 tons Headcount: 152 St Petersburg, Russia Liggett-Ducat Moscow, Russia Established in 1891 Products: ciga
Slide 9: Petro Factory
- Petro Factory - 9
Slide 10: Petro history
Petro history 1852 1923 1998 Opening of Petro‟s Factory renamed as Petro moved to new historical predecessor, the “First Uritsky location the Laferm factory Tobacco Factory” Significant capital investment of more than $600MM in Perto current location During 2007 to 2009, approx. $50MM per annum
Slide 11: Major milestones
Major milestones 1998 Petro moved to new location, old factory on Vassilievsky island closed 1999 RJRI acquired by JT. Petro becomes a member of the JT group of companies 2002 Petro certified ISO 9001-2000 2004 Petro certified ISO 14001 & OHSAS 18001 2005 Acquisition and integration of Cres Neva fac
Slide 12: Petro production volumes
Petro production volumes 87 88 85 75 62 BNU (1) (2) 12 (1) CPB: Crush Proof Box; (2) RCB: Round Corner Box
Slide 13: JTI Strategy & Performance
- JTI Strategy & Performance - 13
Slide 14: JTI Global Supply Chain Mission & Strategies
JTI Global Supply Chain Mission & Strategies Mission statement As one team be the industry best supply chain, driving continuous improvement and excellence in execution Strategies We will: • Deliver highest quality products at best cost • Maintain shortest possible lead times • Work as one team • En
Slide 15: Productivity
Productivity Index (Year 2005 = 100) Cigarettes per Man Hour (indexed) 8% CAGR Since 2008, 4 Ultra High Speed Making & Packing lines (20,000 cigarettes per minute) have been installed Productivity has increased 36% since 2005, supported by improved operator skills as a result of continued invest
Slide 16: Quality: process components
Quality: process components Research Leaf control JTI global evaluations and development In-house production control; QIMS Conformity Consumer Procurement NTM control feedback declaration by Government; Certification (ISO 9001) Supplier qualification Supplier regular audit Robust process of qualit
Slide 17: Quality: consumer feedback
Quality: consumer feedback Feedback per BNU -15% Consumer feedback declined 15% since 2005 New global customer feedback handling procedure has been implemented, aiming to better understanding of the nature of feedback and improved feedback diagnosis 17
Slide 18: Working environment: key highlights
Working environment: key highlights • Safety first: “zero incidents” goal • Global ERM(1) certification • Competitive compensation and benefits • Promotion of employee engagement throughout the organization • Tailored training and development programs • KAIZEN Lost Time Incident rate has been redu
Slide 19: Working environment: suggestion system
Working environment: suggestion system Number of suggestions +84% Significant increase in number of suggestions driving continuous improvement throughout all factory activities All suggestions evaluated and selectively implemented as part of KAIZEN 19
Slide 20: KAIZEN: best practices
KAIZEN: best practices THIS SLIDE HAS BEEN DEVELOPED TO EXPLAIN JTI’S PERFORMANCE TO OUR INVESTORS. IT IS NOT INTENDED TO PROMOTE THE PURCHASE OF OUR PRODUCTS. Productivity Quality Focke HS/UHS Coupon Unit - suction plates Contrast price printing zones development: modification: decrease in rejects/
Slide 21: Continuously improving cost efficiencies
Continuously improving cost efficiencies Index (Year 2005 = 100) Conversion cost per „000 (indexed) -3% CAGR Conversion cost has been constantly declining at 3% CAGR, despite increasing complexity and inflation Effective management of working capital through integrated planning process platform
Slide 22: EHS KPI's
EHS KPI’s Index (Year 2005 = 100) Carbon Footprint - CO2 emissions per Million cigarettes (indexed) -4% CAGR In addition to CO2 emission reduction, energy consumption, waste generation and water consumption decreased 17%, 21% and 22%, respectively Our goal is to continually improve EHS performan
Slide 23: Conclusions
- Conclusions - 23
Slide 24: Conclusions
Conclusions Petro is the largest factory in JTI delivering: a diverse portfolio of world class quality innovative products continued investment in employee development and high-end technology a high level of employee competence and engagement significant quality improvement and cost effici
Japan Tobacco — Investor Presentation (September 2010) on 6ix