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‘Can a Tobacco Company Be Sustainable?’ Philip Morris International Says ‘Absolutely,’ and Outlines Clear Progress Toward a Sustainable, Smoke-Free Future

May 15, 2019

LAUSANNE, Switzerland--(BUSINESS WIRE)--May 15, 2019--

Philip Morris International Inc. (PMI) (NYSE:PM) today published its fourth Sustainability Report, detailing its progress in key areas across its value chain. PMI’s mission to unsmoke the world is core to its sustainability ambition and business strategy.

André Calantzopoulos, PMI’s Chief Executive Officer, said: “We’re often asked, ‘Can a tobacco company be sustainable?’ Our answer to that is, ‘Absolutely.’ That is, provided we are taking every step possible to completely replace cigarettes with better alternatives for the adult smokers who would otherwise continue smoking, addressing challenges across our value chain and seizing opportunities to add value to society. Our most recent Sustainability Report reflects the hard work and dedication of all our employees globally in moving toward our goal of a smoke-free future. It demonstrates that we are on track to achieve this bold ambition and are well positioned to address the challenges ahead.”

The 2018 Sustainability Report outlines how PMI is accelerating efforts to accomplish its mission to unsmoke the world, including its progress against a set of key business transformation metrics. The company’s strategy supplements the efforts by the World Health Organization (WHO) to reduce smoking prevalence, and is aiming to reduce smoking among PMI consumers more than three times faster than the target set by the WHO. The company’s aspiration is that at least 40 million people who would otherwise have smoked cigarettes will have switched to PMI’s smoke-free products by 2025, reducing the number of PMI cigarette smokers by 55 million.

The report documents how PMI is continuing to focus considerable resources to prevent child labor and improve labor conditions throughout its value chain; scaling up its efforts toward improving inclusion and diversity; and reducing its environmental footprint through greener energy, water and litter management and the preservation of biodiversity, land and forests.

The following were among PMI’s key milestones in 2018 on the road to a sustainable, smoke-free future:

The four pillars of PMI’s sustainability strategy are: Transforming Its Business, Driving Operational Excellence, Managing Its Social Impact and Reducing Its Environmental Footprint. In each of these pillars, PMI reassessed its most relevant challenges, with insights provided by a broad group of external and internal stakeholders, to prioritize areas where its work can have the greatest impact, thereby contributing toward the United Nations Sustainable Development Goals. The 2018 Sustainability Report was developed in accordance with the Global Reporting Initiative (GRI) reporting standards and is aligned with the Sustainability Accounting Standards Board (SASB) standards and provides extensive data, inviting readers to assess PMI’s performance across a wide set of metrics.

“It was important to have an updated outside view, considering that our business transformation is advancing rapidly and will lead to new challenges and opportunities,” said Huub Savelkouls, PMI’s Chief Sustainability Officer. “The sustainability materiality analysis we carried out last year highlighted that the mission of our company—to unsmoke the world by replacing cigarettes with better smoke-free alternatives for those adult smokers who would otherwise continue smoking—is fundamental for PMI’s ambition to become a sustainability leader.”

Download the full 2018 Sustainability Report here: www.pmi.com/sustainability/sustainability-report.

About Philip Morris International: Delivering a Smoke-Free Future

Philip Morris International (PMI) is leading a transformation in the tobacco industry to create a smoke-free future and ultimately replace cigarettes with smoke-free products to the benefit of adults who would otherwise continue to smoke, society, the company and its shareholders. PMI is a leading international tobacco company engaged in the manufacture and sale of cigarettes, smoke-free products and associated electronic devices and accessories, and other nicotine-containing products in markets outside the U.S. PMI is building a future on a new category of smoke-free products that, while not risk-free, are a much better choice than continuing to smoke. Through multidisciplinary capabilities in product development, state-of-the-art facilities and scientific substantiation, PMI aims to ensure that its smoke-free products meet adult consumer preferences and rigorous regulatory requirements. PMI’s smoke-free IQOS product portfolio includes heat-not-burn and nicotine-containing vapor products. As of March 31, 2019, PMI estimates that approximately 7.3 million adult smokers around the world have already stopped smoking and switched to PMI’s heat-not-burn product, which is currently available for sale in 47 markets in key cities or nationwide under the IQOS brand. For more information, please visit www.pmi.com and www.pmiscience.com.

Forward-Looking and Cautionary Statements

This press release and the Sustainability Report contain projections of future results and other forward-looking statements. Achievement of future results is subject to risks, uncertainties and inaccurate assumptions. In the event that risks or uncertainties materialize, or underlying assumptions prove inaccurate, actual results could vary materially from those contained in such forward-looking statements. Pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, PMI is identifying important factors that, individually or in the aggregate, could cause actual results and outcomes to differ materially from those contained in any forward-looking statements made by PMI.

PMI’s business risks include: excise tax increases and discriminatory tax structures; increasing marketing and regulatory restrictions that could reduce our competitiveness, eliminate our ability to communicate with adult consumers, or ban certain of our products; health concerns relating to the use of tobacco products and exposure to environmental tobacco smoke; litigation related to tobacco use; intense competition; the effects of global and individual country economic, regulatory and political developments, natural disasters and conflicts; changes in adult smoker behavior; lost revenues as a result of counterfeiting, contraband and cross-border purchases; governmental investigations; unfavorable currency exchange rates and currency devaluations, and limitations on the ability to repatriate funds; adverse changes in applicable corporate tax laws; adverse changes in the cost and quality of tobacco and other agricultural products and raw materials; and the integrity of its information systems and effectiveness of its data privacy policies. PMI’s future profitability may also be adversely affected should it be unsuccessful in its attempts to produce and commercialize reduced-risk products or if regulation or taxation do not differentiate between such products and cigarettes; if it is unable to successfully introduce new products, promote brand equity, enter new markets or improve its margins through increased prices and productivity gains; if it is unable to expand its brand portfolio internally or through acquisitions and the development of strategic business relationships; or if it is unable to attract and retain the best global talent. Future results are also subject to the lower predictability of our reduced-risk product category’s performance.

PMI is further subject to other risks detailed from time to time in its publicly filed documents, including the Form 10-Q for the quarter ended March 31, 2019. PMI cautions that the foregoing list of important factors is not a complete discussion of all potential risks and uncertainties. PMI does not undertake to update any forward-looking statement that it may make from time to time, except in the normal course of its public disclosure obligations.

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View source version on businesswire.com:https://www.businesswire.com/news/home/20190515005340/en/

CONTACT: Philip Morris International

Marija Sommer

Philip Morris International Media Office

T. +41 58 242 5502

E.marija.sommer@pmi.com

KEYWORD: EUROPE SWITZERLAND

INDUSTRY KEYWORD: OTHER CONSUMER ENVIRONMENT RETAIL TOBACCO CONSUMER

SOURCE: Philip Morris International

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PUB: 05/15/2019 04:32 AM/DISC: 05/15/2019 04:32 AM

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