英美烟草+2023巴克莱全球必需消费品会议 A Purposeful and Profitable Pathway to A Better Tomorrow

and

Profitable

Pathway

to

APurposeful

ABetterTomorrowTM

OurNewCategoryJourney

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ImportantInformation

TheinformationcontainedinthispresentationinrelationtoBritishAmericanTobaccop.l.c.(“BAT”)anditssubsidiarieshasbeenpreparedsolelyforuseatthispresentation.Thepresentationisnotdirectedto,orintendedfordistributiontooruseby,anypersonorentitythatisacitizenorresidentorlocatedinanyjurisdictionwheresuchdistribution,publication,availabilityorusewouldbecontrarytolaworregulationorwhichwouldrequireanyregistrationorlicensingwithinsuchjurisdiction.

Referencesinthispresentationto‘BritishAmericanTobacco’,‘BAT’,‘Group’,‘we’,‘us’and‘our’whendenotingopinionrefertoBritishAmericanTobaccop.l.c.andwhendenotingbusinessactivityrefertoBritishAmericanTobaccoGroupoperatingcompanies,collectivelyorindividuallyasthecasemaybe.

Theinformationcontainedinthispresentationdoesnotpurporttobecomprehensiveandhasnotbeenindependentlyverified.Certainindustryandmarketdatacontainedinthispresentationhascomefromthirdpartysources.Thirdpartypublications,studiesandsurveysgenerallystatethatthedatacontainedthereinhavebeenobtainedfromsourcesbelievedtobereliable,butthatthereisnoguaranteeofaccuracyorcompletenessofsuchdata.

Forward-lookingStatements

Thispresentationdoesnotconstituteaninvitationtounderwrite,subscribefor,orotherwiseacquireordisposeofanyBATsharesorothersecurities.Thispresentationcontainscertainforward-lookingstatements,including“forward-looking”statementsmadewithinthemeaningoftheU.S.PrivateSecuritiesLitigationReformActof1995.Thesestatementsareoften,butnotalways,madethroughtheuseofwordsorphrasessuchas"believe,""anticipate,""could,""may,""would,""should,""intend,""plan,""potential,""predict,""will,""expect,""estimate,""project,""positioned,""strategy,""outlook","target"andsimilarexpressions.Theseincludestatementsregardingourintentions,beliefsorcurrentexpectationsconcerning,amongstotherthings,ourresultsofoperations,financialcondition,liquidity,prospects,growth,strategiesandtheeconomicandbusinesscircumstancesoccurringfromtimetotimeinthecountriesandmarketsinwhichtheBritishAmericanTobaccoGroup(the“Group”)operates.

Allsuchforward-lookingstatementsinvolveestimatesandassumptionsthataresubjecttorisks,uncertaintiesandotherfactors.Itisbelievedthattheexpectationsreflectedinthispresentationarereasonablebuttheymaybeaffectedbyawiderangeofvariablesthatcouldcauseactualresultstodiffermateriallyfromthosecurrentlyanticipated.

Inparticular,amongotherstatements:certainstatementsonslides5,6,17,27and33.

Amongthekeyfactorsthatcouldcauseactualresultstodiffermateriallyfromthoseprojectedintheforward-lookingstatementsareuncertaintiesrelatedtothefollowing:theimpactofcompetitionfromillicittrade;theimpactofadversedomesticorinternationallegislationandregulation;theinabilitytodevelop,commercialiseanddelivertheGroup'sNewCategoriesstrategy;adverselitigationanddisputeoutcomesandtheeffectofsuchoutcomesontheGroup'sfinancialcondition;theimpactofsignificantincreasesorstructuralchangesintobacco,nicotineandNewCategoriesrelatedtaxes;translationalandtransactionalforeignexchangerateexposure;changesordifferencesindomesticorinternationaleconomicorpoliticalconditions;theabilitytomaintaincreditratingsandtofundthebusinessunderthecurrentcapitalstructure;theimpactofseriousinjury,illnessordeathintheworkplace;adversedecisionsbydomesticorinternationalregulatorybodies;changesinthemarketposition,businesses,financialcondition,resultsofoperationsorprospectsoftheGroup;directorindirectadverseimpactsassociatedwithClimateChangeandthemovetowardsaCircularEconomy;andCyberSecuritycausedbytheheightenedcyber-threatlandscape,theincreaseddigitalinteractionswithconsumersandchangestoregulation

Pastperformanceisnoguidetofutureperformanceandpersonsneedingadviceshouldconsultanindependentfinancialadviser.Theforward-lookingstatementsreflectknowledgeandinformationavailableatthedateofpreparationofthispresentationandBATundertakesnoobligationtoupdateorrevisetheseforward-lookingstatements,whetherasaresultofnewinformation,futureeventsorotherwise.Readersarecautionednottoplaceunduerelianceonsuchforward-lookingstatements.

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ImportantInformation

Forward-lookingStatements(continued)

AdditionalinformationconcerningtheseandotherfactorscanbefoundinBAT’sfilingswiththeU.S.SecuritiesandExchangeCommission(“SEC”),includingtheAnnualReportonForm20-FandCurrentReportsonForm6-K,whichmaybeobtainedfreeofchargeattheSEC’swebsite,,andBAT’sAnnualReports,whichmaybeobtainedfreeofchargefromtheBritishAmericanTobaccowebsite

.

AdditionalInformation

AllfinancialstatementsandfinancialinformationprovidedbyorwithrespecttotheU.S.orReynoldsAmericanInc.(“Reynolds”)areinitiallypreparedonthebasisofU.S.GAAPandconstitutetheprimaryfinancialstatementsorfinancialrecordsoftheU.S.business/Reynolds.ThisfinancialinformationisthenconvertedtoInternationalFinancialReportingStandardsasissuedbytheIASBforthepurposeofconsolidationwithintheresultsoftheBATGroup.TotheextentanysuchfinancialinformationprovidedinthispresentationrelatestotheU.S.orReynoldsitisprovidedasanexplanationof,orsupplementto,Reynolds’primaryU.S.GAAPbasedfinancialstatementsandinformation.

OurVapourproductVuse(includingAlto,Solo,CiroandVibe),andcertainoralproductsincludingVelo,Grizzly,Kodiak,andCamelSnus,whicharesoldintheUS,aresubjecttotheFoodandDrugAdministration(“FDA”)regulationandnoreduced-riskclaimswillbemadetotheseproductswithoutagencyclearance.

NoProfitorEarningsPerShareForecasts

NostatementinthispresentationisintendedtobeaprofitforecastandnostatementinthispresentationshouldbeinterpretedtomeanthatearningspershareofBATforthecurrentorfuturefinancialyearswouldnecessarilymatchorexceedthehistoricalpublishedearningspershareofBAT.

Audience

ThematerialinthispresentationisprovidedforthepurposeofgivinginformationaboutBATanditssubsidiariestoinvestorsonlyandisnotintendedforgeneralconsumers.BAT,itsdirectors,officers,employees,agentsoradvisersdonotacceptorassumeresponsibilitytoanyotherpersontowhomthismaterialisshownorintowhosehandsitmaycomeandanysuchresponsibilityorliabilityisexpresslydisclaimed.Thematerialinthispresentationisnotprovidedforproductadvertising,promotionalormarketingpurposes.Thismaterialdoesnotconstituteandshouldnotbeconstruedasconstitutinganoffertosell,orasolicitationofanoffertobuy,anyofourproducts.Ourproductsaresoldonlyincompliancewiththelawsoftheparticularjurisdictionsinwhichtheyaresold.

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01

03

AMulti-

NewCategories

are

valueaccretive

Category

Portfolioisessential

isajourney

TobaccoHarm

Reduction

02

4

Today’sThemes

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Ourpurposeistobuild…

…throughreducingthehealthimpactofour

businessbyofferingagreaterchoiceofenjoyable

andlessrisky*tproductsforourconsumers

*Basedontheweightofevidenceandassumingacompleteswitchfromcigarettesmoking.Theseproductsarenotriskfreeandareaddictive.

5

†OurvapourproductVuse(includingAlto,Solo,CiroandVibe),andcertainproducts,includingVelo,Grizzly,Kodiak,andCamelSnus,whicharesoldintheU.S.,aresubjecttoFDAregulationandnoreduced-riskclaimswillbemadeastotheseproductswithoutagencyclearance.

6

OurObjective:

Deliveringvalueforallofourstakeholders

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…andwe’veonlyjustbegun

100mof1.1bn

7

GlobalconsumernumbersforNewCategoriesandSmokersatanIndustryLevelSource:Statista2023,KantarIncidence&TrackStudies

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Increasinglyaglobalphenomenon

~60%

OfT-50marketsfullyopentoNewCategories

BRAMEXTUR

Keyglobalmarketsremaininaccessible

~30%

Countriesrestrict

1ormoreNew

Categories

8

Source:BATDataofcurrentmarketregulationsH12023

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AccessrestrictedtooneormoreNCsHighlyrestrictedorinaccessibletoNCs

SATISFACTION

IDENTITY

HARMREDUCTION

Marketsandconsumersarenothomogeneous

AccessibleNCmarkets

FLAVOURPREFERENCES

VALUE

CONVENIENCE

Regulation&Access

FundamentalDrivers

Occasions&Consumption

meeting

allpreferences

Nosinglesolutioniscapableof

9

Source:BATdata&ProprietaryConsumerResearch

10

So…weareinvestingnowinaMulti-Categoryfuture

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Beliefsto

Challenge

11

1

Thereisa

‘onesizefitsall’

solution

5

Nicotineisasubstantialcauseofdiseasefromsmoking

3

THPencouragesmoreswitchingthanvaping

7

Poly-users

tendtosmokejustasmuch

10

Industryvalueisdecliningwithcigarettesales

4

ModernOralisa

Scandinavian

phenomenon

8

NCsareusedequallyacrosscohorts

6

NewCategories(NCs)areoftenagatewaytosmoking

9

NCsareless

profitable

2

THPattractsthemostconsumers

BeliefstoChallenge

12

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6

NewCategories(NCs)areoftenagatewaytosmoking

9

NCsareless

profitable

8

NCsareusedequallyacrosscohorts

5

Nicotineisasubstantialcauseofdiseasefromsmoking

7

Poly-users

tendtosmokejustasmuch

10

Industryvalueisdecliningwithcigarettesales

Theme1:Multi-Category

4

ModernOralisa

Scandinavian

phenomenon

3

THPencouragesmoreswitchingthanvaping

1

Thereisa

‘onesizefitsall’

solution

2

THPattractsthemostconsumers

13

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THPPenetration(%FMC*)

VapingPenetration(%FMC*)

Belief#1Thereisa‘onesizefitsall’solution

>70%ofVapour

>80%

ofTHP

60%

80%

70%

FACT

50%

60%

40%

50%

30%

20%

10%

40%

30%

20%

10%

0%

0%

THPandVapour

correlate

inverselyto

Weighted

AverageTar

levels

8.5mg

AverageWeighted

TarperCigarette

8.5mg

AverageWeightedTarperCigarette

*FMC:FactoryMadeCigarettesSource:KantarIncidenceStudy2022,RetailAudit(suppliersdifferentbymarket),BATinternalinformation

Belgium,Bulgaria,Canada,Colombia,Croatia,CzechRepublic,Denmark,France,Germany,Greece,Hungary,Italy,Japan,Kazakhstan,Malaysia,Mexico,Netherlands,NewZealand,Poland,Portugal,Russia,SaudiArabia,Spain,SouthKorea,Sweden,Switzerland,UK,Ukraine,USA

14

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Belief#2THPattractsthemostconsumers

62

#TotalAdultUsers*(Mn)

54

FACT

43

+36

40

34

26

+24

21

17

13

Vapouristhebiggest

contributorto

consumergrowth

andaccelerating

11

10

10

7

2

2

20182019202020212022

VapourTHPMO

Source:KantarIncidence&TrackStudies2022*Adultusersbasedon20YearsofAge+inUSA.18+inallothermarkets

15

T42Markets:Algeria,Argentina,Australia,Bangladesh,Belgium,Brazil,Bulgaria,Canada,Chile,Colombia,CzechRepublic,Denmark,Egypt,France,Germany,Greece,Hungary,Indonesia,Italy,Japan,Kazakhstan,Malaysia,Mexico,Morocco,Netherlands,NewZealand,Nigeria,Pakistan,Poland,Romania,SaudiArabia,SouthAfrica,SouthKorea,Spain,Sweden,Switzerland,Taiwan,Turkey,UK,Ukraine,USA,Vietnam

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66%

34%

54%

46%

65%

35%

Belief#3THPencouragesmoreswitchingthanvaping

NCConsumers:StillSmokingDailyStoppedSmokingDaily

37%

39%

FACT

63%

61%

Vapour

THP

65%

71%

29%

35%

Vapour*andTHP

areequallyeffective

atencouraging

smokerstoswitch

Vapour

THP

THP

Vapour

61%

63%

64%

39%

37%

36%

Vapour

THP

THP

Vapour

16Source:KantarIncidence&TrackStudies2022

*VapourincludesDisposablesandrechargeableclosedsystemonly

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FACT

MOwillhaveacriticalpositiveroletoplayasmarketexpansionandtheUSaccelerategrowth

Belief#4ModernOralisaScandinavianphenomenon

MORevenueContribution

1.5

22%

1.1

21%

0.8

19%

52%

50%

25%

31%

27%

53%

2021

2022

2023Est

NordicsUSARoW

17

MOIndustryRevenue,£bnSource:KantarIncidenceStudy2022,BATOutlook

2

Vapouristhebiggestcontributortoconsumergrowthandaccelerating

3

Vapour&THPareequallyeffectiveatencouragingsmokerstoswitch

4

ModernOralwillhaveacriticalpositiveroletoplay

18

Implication1

1

THP&VapourcorrelateinverselytoWeightedAverageTarlevels

AMulti-CategoryPortfolioisEssentialtoDeliverourPurpose&Industry

Transition

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2

Vapouristhebiggestcontributorto

consumergrowthandaccelerating

6

NewCategories(NCs)areoftenagatewaytosmoking

9

NCsareless

profitable

3

Vapour&THPareequallyeffectiveat

encouragingsmokerstoswitch

7

Poly-users

tendtosmoke

justasmuch

10

Industryvalueisdecliningwithcigarettesales

4

ModernOralwill

haveacritical

positiveroletoplay

8

NCsareusedequallyacrosscohorts

Theme2:THR

19

1

THP&VapourcorrelateinverselytoWeighted

AverageTarlevels

5

Nicotineisasubstantialcauseofdiseasefromsmoking

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FACT

Mostoftheharmfromsmokingiscausedbyproductsofcombustion,notnicotine

UKROYALCOLLEGEOFPHYSICIANS

It’stheotherchemicalcompoundsintobacco,andinthesmokecreatedbysettingtobaccoonfire,thatdirectlyandprimarilycausetheillnessanddeath,

notthenicotineDR.SCOTTGOTTLIEB

USFDACOMMISSIONER(JULY2017)

Nicotineisnot…ahighlyhazardousdrug.

Themainculpritissmokeand,ifnicotinecouldbedeliveredeffectivelyandacceptably…withoutsmoke,most,ifnotall,oftheharmofsmokingcouldprobablybe

avoided

Nicotinewithoutsmoke:Tobaccoharmreduction(2016)

20

Belief#5Nicotineisasubstantialcauseofdisease

fromsmoking

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FACT

Ingeneral,newadultnicotineconsumersdon’tontosmoke

2.2%

1.8%

1.7%

3.1%

%SolusVapour

Entrants

switchingto

FMC2022

go

%ofadultpopulation

0.1%0.1%0.04%0.05%

Belief#6NewCategoriesareoftenagatewayto

smoking

%SolusVapourEntrantsswitchingtoFMC*

Globally**

2.2%

2.1%

2021

2022

*FactoryMadeCigarettes

21

Source:KantarIncidence&TrackStudies2022**TopNCMarkets:Canada,Denmark,France,Germany,Italy,Japan,Poland,S.Korea,Sweden,Switzerland,UK–excludingUSA

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FACT

Theconsumerjourneyofteninvolvespoly-usagewherecigaretteconsumptionisreduced

Index

92

83

FMC+THPFMC+MO

FMC+Vapour

Belief#7Poly-userstendtosmokejustasmuch

FMC*AverageDailyConsumptionreductionamongPoly-Usersvs.FMCSolus

100

Index

81

Consumptioninleading9NCmarketsinstickEquivalent.

22

*FactoryMadeCigarettesSource:KantarIncidence&TrackStudies2022

Canada,Denmark,Germany,Italy,Japan,S.Korea,Sweden,UK,USA

“Poly-usage"referencesatransitionalperiodforadultFMCconsumerstowardsacompleteswitchingtoNCsduring

whichadultconsumersreducecigaretteconsumptionandchoosetoaddtoitaconsumptionofoneormoreNCs.

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35%22%43%

28%23%49%

22%16%62%

Belief#8NewCategoriesareusedequallyacross

cohorts

Categoryuse-AgeCohorts

2018

2022

FACT

AU3024%23%53%

AU30

30-4421%17%62%

30-44

NCpenetration

correlatesinversely

totheagecohortsof

adultconsumers

AO45

AO4513%13%73%

SolusNC**

DualFMC-NC**SolusFMC*

23

*FactoryMadeCigarettes**NCIncludesSnus“Dual-usage"referencesatransitionalperiodforadultFMCconsumerstowardsacompleteswitchingtoNCsduringwhichadultconsumersreducecigaretteSource:KantarIncidence&TrackStudies2022

consumptionandchoosetoaddtoitconsumptionofanNC.AU30:Adultconsumerfromminimumlegalageto30yrs.AO45:Adultconsumerover45yrs.Canada,Italy,Japan,UK,Sweden

2

Vapouristhebiggestcontributortoconsumergrowthandaccelerating

6

Ingeneral,newadultnicotineconsumersdon’tgoontosmoke

3

Vapour&THPareequallyeffectiveatencouragingsmokerstoswitch

7

4

ModernOralwillhaveacriticalpositiveroletoplay

8

Cigaretteconsumptionisdecliningwith

poly-usage

NCpenetrationcorrelatesinverselytotheagecohortsofadultconsumers

TobaccoHarmReductionisabonafidecorporateandsocietalgoal

24

Implication2

1

THP&VapourcorrelateinverselytoWeightedAverageTarlevels

5

Mostoftheharmfromsmokingiscausedbyproductsofcombustion,notnicotine

Classified-Confidential

1

THP&VapourcorrelateinverselytoWeightedAverageTarlevels

5

Mostoftheharmfromsmokingiscausedby

productsofcombustion,

notnicotine

3

Vapour&THPareequallyeffectiveatencouragingsmokerstoswitch

7

4

ModernOralwillhaveacriticalpositiveroletoplay

8

Cigaretteconsumptionisdecliningwithpoly-

usage

10

Industryvalueis

decliningwith

cigarettesales

NCpenetrationcorrelatesinverselyto

theagecohortsofadultconsumers

25

2

Vapouristhebiggestcontributortoconsumergrowthandaccelerating

6

Ingeneral,newadultnicotineconsumers

don’tgoontosmoke

9

NCsareless

profitable

Theme3:IndustryValue

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FACT

NCsarealreadypositiveatGrossMarginlevelinalmostallCategories

**EuropeAvg.

*WorldAvg.*Worldexcl.USAvg.

Belief#9NewCategoriesarelessprofitable

AnnualConsumerProfitabilityIndex

VAPOURRechargeable

VAPOURDisposable

>120SolusFMC†

<80SolusFMC

80-120SolusFMC

Source:BATdata:IndexedNCGrossMarginperconsumerperannumvsFMC

*WorldAveragebasedonTop17NCmarketsaccountingfor~85%ofWorld’sNCsrevenue,basedonBATinternalest..

26

**EuropeTop12EuropeanNCMarketsaccountingfor~85%oftotalEurope’sNCrevenue,basedonBATinternalest.†FactoryMadeCigarettes-GMsperunitbasedonBATinternalestimates:FMCValueformoney(2023@‘22FXrates);Users&AvgdailyconsumptiondatabasedonNCTrack,NCusers.-AnnualGrossMargin(excl.MarketingInvestmentinrevenue&Royalties)peruserGroup

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£12bn

£43bn

Belief#10Industryvalueisdecliningwithcigarette

sales

T10IndustryValuevsFMCVolume

654bn

FMC**

VOLUME

FACT

Totalnicotinerevenueisgrowingyear-on-yearwithNewCategoriesdrivingvalueaccretion

613bn

570bn

-6.3

%CAGR

£8bn

£10bn

INDUSTRY

VALUE

£43bn

£43bn

+3.4

%CAGR

2021

FMC**Volume

2022

NCValue(Rev*)

2023Est

FMCValue(Rev*)

27

*Revenue**FactoryMadeCigarettesSource:BATOutlook

USA,UK,Germany,Canada,Japan,Switzerland,Italy,Denmark,Poland,SouthKorea,France,Sweden

2

Vapouristhebiggestcontributortoconsumergrowthandaccelerating

6

Ingeneral,newadultnicotineconsumersdon’tgoontosmoke

9

3

Vapour&THPareequallyeffectiveatencouragingsmokerstoswitch

7

4

ModernOralwillhaveacriticalpositiveroletoplay

8

Cigaretteconsumptionisdecliningwith

poly-usage

NCpenetrationcorrelatesinverselytotheagecohortsofadultconsumers

10

Totalnicotinerevenueisgrowingyear-on-yearwithNCsdrivingvalueaccretion

28

1

THP&VapourcorrelateinverselytoWeightedAverageTarlevels

5

Mostoftheharmfromsmokingiscausedbyproductsofcombustion,notnicotine

10Facts

NCsarealreadypositiveatgrossmarginlevelinalmostallCategories

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29

Today’sThemes

3

NewCategory

Productsare

ValueAccretive

1

AMulti-CategoryPortfoliois

Essential

2

TobaccoHarm

Reductionisajourney

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Belief#11Japanisthe‘bellwether’transformation

story

SwedenFMC*Incidence2008-2022

14.3%

13.4%

11.8%

11.3%

10.0%

9.0%

6.9%

5.9%

Swedenhas

successfullydelivereda

multi-decadeTobacco

HarmReductionpolicy

200820092010201120122013201420152016201720182019202020212022

30

*