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IMPERIAL BRANDS PLC 6 October 2021 Pre - close trading update ● ● ● ● IMPERIAL BRANDS Delivering in line with guidance and on track to meet full year expectations Focus on top five priority markets beginning to arrest long - term share declines Market trials underway with heated tobacco in Czech Republic and Greece , and blu in the US Significant new hires to strengthen capabilities across the Group Continued strong cash generation supporting our planned investment behind the new strategy Chief Executive Stefan Bomhard commented " We have made good progress in implementing our strategy through a sharper management focus , greater investment behind our priority combustible tobacco markets and new market trials in heated tobacco and vapour . We are building a high performance culture with the introduction of new more consumer - focused ways of working , and have made a significant number of new hires to enhance our capabilities in key areas . I am pleased to report the business continues to perform well and we remain on track to deliver our full - year results in line with expectations . " Group net revenue is expected to grow by around 1 per cent on an organic , constant currency basis , driven by continued strong pricing in tobacco . In our combustibles business , greater focus on our five priority markets is beginning to stabilise the long - term aggregate market share performances in these markets with share expected to be slightly lower by around 2-3 basis points , compared with a 17 basis point decline in the prior year . We are stepping up our investment behind our strategic initiatives in each of these priority markets to drive performance improvements . Overall tobacco volumes are in line with expectations and total Group cigarette market share is expected to grow by c . 20 basis points . The net effect of the COVID - 19 travel restrictions and changes in consumer buying patterns has been a small mix benefit , although this is beginning to reduce as restrictions are lifted and is likely to unwind further in FY22 . In Next Generation Products ( NGP ) , we are committed through our new strategy to make a meaningful contribution to harm reduction , led by consumer needs . As anticipated , second - half NGP revenue is expected to be at a similar level to the first half , reflecting the impact of market exits as we focus on the categories and markets with the best potential for sustainable growth . We have taken steps this year to strengthen our capabilities and performance to create a solid foundation for future growth . In line with our strategy , we have launched market trials for our heated tobacco proposition in the Czech Republic and Greece , as well as a trial of an improved consumer marketing proposition for our vapour product , blu , in Charlotte , North Carolina . We will be monitoring the consumer response to these trials over the coming months and will update on progress during 2022 . Group adjusted organic operating profit growth is expected to be in line with our guidance of low to mid - single digit constant currency growth , reflecting significantly reduced losses in NGP and increased Distribution profit . The tobacco business has performed well although adjusted operating profit will be slightly lower than last year , as previously guided , as a result of the planned increased investment to support our strategic plan as well as lower stock revenue / profit in Australia ( c . £ 90m ) and US state litigation settlement costs ( c . £ 50m ) . At current exchange rates , translation foreign exchange is expected to be c . 3 per cent headwind to full year earnings per share . As previously announced , the adjusted effective tax rate is expected to increase this year from 21 per cent to around 23 per cent . Page 1 of 2