p S
4 HOV 1991
4"
2w
'A
BM.
BROWN WILLIAMSON
-TOBACCO CORPORATION-
V.
..T
i INV
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7T. PORT-%-.-
NCIALRE
TINA
wi
sZ- li@t
RESTRICTED SEPTEMBER 1991
13.A.T INDumas P.LC. - MINNESOTA DEPOSffoRy Copy - PROWCED PURSUANT To VILD. OF
CoNsENT JuDamur DATEo SAM IN ISTAM OF MAIMSOU, Er AL V. PHXF NORM& Er CASE 140. Cl 94 5
TO: AU RECIPIENTS OF THE MORMY MANAGEKENT REPORT
The enclosed Management Report, which presents October, 1991
year-to-date results, replaces the Monthly Financial Report.
The format has been changed to be more responsive to
informational requirements of the recipients, as was identified
during a series of interviews with a number of internal
recipients of the Financial Report as well an input from
recipients at B.A.T Industries concerning their reporting
requirements.
while this report includes a number of revisions and
enhancements, two changes should be pointed out to you:
Reported variances from budget on the various schedules
contained within the report are absolute variances. There
will no longer be adjustments made to the reported numbers
for temporary or other timing variances. Instead the
cowAwntary will address areas where significant timing
differences may be occurring.
in the "Domestic* section of the report, beginning on page
5 the I'Monthly Sales Letterw is presented, the contents of
which are already received by several, but not all,
recipients of this report. Additionally, in the
'International" section of the report, beginning on page
6, excerpts from the Monthly International Letter are
included for several key markets.
If after reviewing the report you have any questions or comments
concerning the contents of this document, please contact Gene
Tucker (Xxt. 8332) or Larry Marzberg (Rxt. 7SSO).
C:)
December 3, 1991
Co
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LN
BAT INDUSTRIES P.Lr- - UWNESDTA OEpoWoRy Copy CEO
CONSENT JUDGMENT DATED tUaft IN Sr Fftw PWtSUANT To VII.D. OF
A 7F OF ANANWS V. lp Afcnn@
0 Er . Er CASE No. C1444105
SECTION I - INCOME STATQJW AND SUPPOflTIX9 WFORMATI
Pace
No.
Summary Income Statement with Absolute Variances (U.S./U.K. Basis)
I&
Commentary on Summary Income Statement (U.S. Basis)
I
& lb
Management Income Statement with Operating Variances
2a
Comments on Management Income Statement
2
Trading Profit Graphs
3
3&
Domestic Salts Quantities - Summary
4
4&
Domestic Sales Quantities By Brand
5
& 51
Marketing Expense Sumnary
6
& 6a
Brand Contribution Summary
7
& 7&
Domestic General & Administrative Expenses
8
Statement of International Profit Contribution
9
& 98
International Sales Quantities
10
& Joe
Export Leaf Tobacco Profit Contribution
11
& Ila
Common Operating Costs - Manufacturing
12
9 He
NT Common Cost (Excluding C.O.C. Manufacturing)
13
,'CTION 11 - HIET ASSETS
Not Assets la, I & lb
Operating Cash Flow 2
Capital Expenditures Progress Report 3, 3a, 3b & 3c
Capital Expenditures Budget 4
OD
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CON" B.A.T IMLaTnin P.LC. - MME!WTA DEPOSITORY Copy pRMCED pURSUANT To VILD. oF
NT JUDGMENT DATED WSW p4 SYATF OF 0NNESOM IT AL V- PH11P A00RRM Er AL- CASE No. C1.94.W5
TABLE OF CONTENTS (CONT'D.)
SECTION 111 - SPECIAL REPORTS
Charts on Current Estimate and Last Ton Years Results:
Trading Profit
Revenue 2 & 2a
Cash Flow & RONA 3 & 3a
Domestic Revenue and Units 4
Domestic Volumes and Share of Market 5 & 61
International Results in Percentages 6 & 68
SECTION TV - BATUS QNSOLIDAI
BATUS Consolidated Statement of Met Income la
BATUS Consolidated Commentary I
BATUS Summary of Other Incow/(Expense) and Net Interest Ib
Note: Any presentation in this report of the incow of BATUS and its consolidated
U.S. subsidiaries using an inventory accounting method, on a basis other than
LIFO, is supplemental to the primary U.S. income statements.
CO
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13.A.T 1"DuSTRIES p.L.M - MONESOTA OLOwm Copy CED PURSU To VII.D. or
CONSENT JUDGMEW DATED 5/8M IN SrATE OF PRODI) AW
R@s M ET AL V. PH&P AfwX% ET AL_ CASE No. C1.94@5
Co
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L?4
B.A.T INDUVRIES P.Lc. - MrsoEsou Do*sffm Copy - PRooucED PuRsuAmT To Vil.o. oF
COMENT JUDGMENT BATED SMW IN STATE OF AdINNESOM ET AL V. PHXP AOORFW, ET AL CASE NO. C1-944=6
N)
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L.04
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B.A.T INDUSTRIES P.LC. - MWNEWTA DEPOSFTORY COPY - PROWCED PURSUANT To I VILD. oF
Comm JuoumEmT BATED SAM m STATE oF Alimmou, Er AL v. PHxv Wom ET CAss No. CI-94-MG
BROWN & WILLIAMSON TOBACC
SUMMARY INCOME STATEM
ABSOLUTE VARIANCES
SEPTEMBER. 1"I
CU
RRENT MONTH
I Y
EAR-TO-DATE
I
CHANGE FROM:
DESCRIPTION
CHANGE FROM:
I
I
LAST
LAST
ACTUAL
BUDGET
WAR
GROSS VMS UNITS: poorto
ACTUAL
BUDGET
YEAFI
%
4.027
351
- 355
DOMESTIC
36.6110
2.014
3.2
3.188
421
827
INTERNATIONAL
28.644
4"S
601
2.1
8.0151
- 386
471
TOTAL 1
$6,244
6,3091
1,7371
2.7
1
GROSS PAID SALES:
I
230.1185 5,308
10.974
DOMESTIC
11710me 121,M.
231"
15.7
66.287 8352
13,414
INTERNA71ONAL
505= 77J97
33,469
7.1
16.654 9,416
. 1,545
ELT (EXCLUDES
91.214
25.601
. 819
0.91
1303.?M_I* 4.445
22.5461
TOTAL U.S. BAS
2Xf
'173.1261
264=
12:9]
1
TRADING PROFFT.
S3,945
- &.807
- 37.M
DOMES'"C: CONTRIBUTION
46ZM
* 84JM
1AM
0.3
III'm
416
5,7M
IINTERNATIONAL CONTR.
149.541
* 11.991
13N4
9.9
22.=
4.791
- 13"
COC MANUFACTUMW
in'l"
51"ll,
* 111.1in
6.8
1"
1.105
* 97
ELT CONTRIBUTION
7,M
2,M
- 1.177
13.8
S.i23
2.651
* 12,704
COC OTHER
WAS
11,922
- 9.M
10.7
4091
-
-
NBU UFO
3A" I
- I
-
-
Wm 1
* R.M I
U.S. TRADING PROFIT
431.7121
0 76.398 1
* 4.971 1
,J
45.125 1' 39,021 1' 59.40 1 Ux TYIUWWING FROM I 4N.SU I- 7N.3ft I- 11,11W I X.0 I r")
Note: An Isleft MdeaM an WOW" Willparion 01108 Paok (aft &=MP&flyIn9WMNrftrY
an Summary V=me 6M U.S. Accounting Basis)- co
Co B.A.T [NmmIES P.L.C. - MMESDrA DEPOSITOW COPY - PRONCED PUrMAxT To I VILD. oF
NSENT JUDGMENT DATED 5 .AM IN SrATE cw FSOM, ET Al V. PH&P uoggx. Er AL.- cAsE No. Cl.94.ms
SEPTEMBER, 1991 VERSUS BUDGET
September, 1991 Trading Profit of $42.6 was $38.4 lower than
budget, due to the following:
Domestic profit contribution of $53.9 was $37. $_lower than
budget due to unfavorable marketing expense3-M3.2) and an
unfavorable variable margin ($4.4). Marketing expenses war*
higher than budget due mainly to discounting for KOOL, VICEROY,
RALEIGH Extra and GPC resulting from timing. The timing of
spending is in part due to the reallocation of funds which war*
earmarked earlier in the year for RICHUND and ZEIAIR LPS.
Also, bActher retulms f contributed to the higher
than budg4ite-d- market ng expenses. Despite favorable overall
volumes and pricing, a mix shift from Full Revenue and Low
Price branded to GPC resulted in an unfavorable variable
margin.
Common operating costs - manufacturing were unfavorable ($4.8)
due to higher expenses associated with capital projects
($1.5), unfavorable cost variances (primarily leaf price,
$1.3), and a reduction in variable manufacturing cost resulting
in a reduction in finished goods inventory value ($1.8).
ZLT profit contribution was $1.1 favorable due mainly to
favorable timing of domestic flue-cured sales to Hong Kong.
Comson operating costs - other were favorable $2.7 due to
favorable profit sharing ($2.2), legal ($.8), and research and
development expenses ($.$).
Year-to-dat* Trading Profit of $431.7 was $76.4 below budget due
to the following:
Domestic profit contribution of $462.7 was $84.9 below budget
duo to an unfavorable variable margin ($82.3), an favorable
pricing ($33.1) was mor* than offset by an unfavorable
volum*/mix variance on cigarettes ($117.0, as shown below):
VOL MIX
rull Revenue -2.6 -96.8
Low Price Branded -2.8 -47.0
Extra Low price +2.4 +26.0
TOTAL -2.0 -117.8
(Continued)
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B.A.T INDUgMES p.Lc. MINNESOTA DoosnVay Copy _ ft=CED PURNAN To VII.D.
CONSENT JUDGMENT DATED SAM IN SrATE OF A# &T .. I. CW
V A&V fikRAYS ET Al- CASE 140. C14K4W5
SEP-MrKEER, 1991 YM-TQ-DATE VERSUS BUDGET (Continued)
International profit contribution of $148.6 was $12.0 lower
than budget due to an unfavorable variable margin ($35-2)
resulting from an unfavorable volume/mix variance ($43.0) due
mainly to lower volumes (-4.3 billion, mainly in the Far East).
which was partially offset by a favorable spending variance
($7.8, duo mainly to variable manufacturing cost). Also,
advartising/promotion expenditures wwra favorable $9.7 (duo
mainly to spending reductions in Thailand, the Middle East and
Japan) and foreign exchange was favorable $7.6 which is
partially offset in variable margin.
Common operating costs - manufacturing were $5.7 favorable due
to the timing of overhead cost assigned to Finished Goods
($4.6) and Macon overhead spending, mainly maintenance and
overhaul ($5.4), reduced in part by unfavorable cost variances
($3.3).
ELT profit contribution was $2.9 favorable due to timing
differences an sales of domestic flue-cured strips to Hong
Kong, and increased sales volumes to Germany, Hong Kong and BAT
UX&E.
Common operating costs - other were favorable $11.9 due to
lower profit sharing ($2.4), legal expense ($5.7), damaged
obsolete materials ($1.3), and research and development ($2.4).
SEPTEMBER, 1991 YE"-TO-DkTE VERSUS EMBER, 1990 YEAR-TO-DATE
September's year-to-date Trading Profit of $431.7 was $5.0 lower
than last year due to the following.
Domestic profit contribution was $1.6 higher than last year due
to higher variable margin ($122.8), offset by in=*axed
marketing expenses ($117.7). The impact on variable margin of
increased pricing and higher overall volumes was somewhat
reduced by an unfavorable sales mix shift from Full Revenue and
Low Price Branded to Extra Low Price brands. The higher
marketing expenses wara due mainly to increased discounting
activities for Viceroy ($37.0) and Raleigh Extra ($17.3)
coupled with increased media spending for space advertising,
primarily out-of-home, for Raleigh Extra ($7.7) and Kool
($13.3), and higher loss on returns ($21.6) due in part to
SELUR LP3.
international profit contribution was $13.4 higher due mainly
to higher variable margin ($21.1). The higher variable margin
was due mainly to & stronger Yen versus last year. offset
partially by an unfavorable six of sales in the Hong Kong
Group. Advertising expenditures wore $6.1 higher duo mainly to
increased spending in the Par East, primarily Japan and Korea.
(Continued)
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%4
OAT INWMIES P.LC. - MUMOTA DLV9ffORy Copy CEO PURSUMT To I VII.D. OF
CONSENT JUDWAPff DATEa &WW IN PRM
STAM-OW Aftwsor& ET AL V. pwp AfOROW, Er AL, CAqj No. C1.944WS
SrPTrM§ER, 1991 YF"-m-O-MTr VMtSUS QrPTEMIBER, 1990 YEAR-TO-D=
(Continued)
Common operating costs - manufacturing were $9.2 higher due.
mainly to higher Macon overheads associated with the overhauls of
fabrication equipment and higher expenses associated with capital
projects.
Casson operating costs - other were $9. 6 higher due mainly to
legal expenses ($10.5) resulting from the reversal in 1990 of a
legal provision ($15.0) established in a prior year.
B.A.T INDusTRiEs P.LC. - MINNESOTA DoMffORV CopypCEO ANT To VII.D. OF
CONSENT JUDGMENT DATED SAM IN VATS OF AtwsorA, ET AL VRODU PURN
PP&P UORRN, Er A" CASE No. CI-9"5&5
BROWN AND WILLIAMSON TOBACCO
MANAGEMENT INCOME STATEMENT
iOPERAriNa VARIANCES @
(DOMM ih ThGU"nds)
TO D
ATE
VAR
IANCE
DESCRIPTION
VMCM
I LAST
ACTUAL
AMOLWV
%
S
I AMO
ACTM
YEAR
I
"CAll
11 S"S
* lis
l OP433 PAID SALES lDOME9TK,
GANJ
1214M
1.710,238
11.47f.ag;
2
1423W
I 0 4,430
L_J=.
MARGIN
7.41%
1,13.9?0
emizal
1
!
l
3
U.212
* VA
* 100.4%
SPECIRC BRAND EXPENSES
2.ft
225.20S
1
BRAND CONTRIWTION
i
l
l
1
B2.50
* 81.7W
0 2a.m
(AFTER MRNSI
IIA%
olkw
702317
1
i
NON-VECIFIC_
:
l
I
5
2`11700
804
4,0%
MARKETING EXPENSES
0
*W
ISGA"
174,905.
1
1
1
i
a
6002
96
1.4%
ADMINISTRATIVE
915
5314v
42,916
1
DOMESTIC PROR
1
l
7
93.0".
80,7w
33AM6
CONTRiBLITION
IGAS
09AS3
40-?2t
l
1
1
ONAL PROFIT
,w

Br
!
1
0
lem4
2=
1.7%
c
oN
m
LmON
7A%
It"
148,441
In'to
1
j
l
COMMON OPERATING
1
,
9
ni
4.178
=J%
COM-MANMCTtMMG
-0.7%
"4
10,144
113.9119,
1
l
l
l
I
10
lA"
1.105
I*L?%
ELT PROFIT CONTPMnION
I.=
7jn
49
SA
I
OOMON OPERATING
6.128
1.7011
Com-OTHER
ISAMI
901
"AM.
48.616
12
409
-
NW UFO-OTHER
&MI
3.6?3'
Is
AILS" 1
* 81*441
UA%l
TwwepF4m
ITAS
* NJ
4101,7121
4UM3
NVM- AN ASM" MICATES AN UNMV04411111 VAR11410CE WITHINI THIS MEPM. qNSVINARY VAR14NCEr N4Vf
SM DOINDID FIlKW THIS 60HIII)LU AND SUNIQUENT 60"W"S PRlIftV= WITHIN THIS Ro4m,
_29-
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B.A.T kmmjEs P.LC. - LIW*WA DEpOWM Copy pRMCED PURWMT To V11.0. OF
CONSENT JUDGMENT OATED 5/8M IN STATE OF 7A, I AL V P14P AIMOM.-ET AL. CASE No. CI-944M5
COPMMS ON TRADING PROFIT (DOLLARS IN-NOUSANDS)
September YTO
Trad fit - Absolute Variance $36,39SU $76,39SU
Less'!uzary Variances . "lu -11-IMI
Line 13 Trading Profit - Operating Variance
OF OPFRATING ARIAKE
I cSales VOIMMIX 9,46DU 119,641U
M
Variable Hargin Spending 5,029F 36,339F
Specific grand Expenses 27,32SU 8.966U
Non-Specific Marktting Expenses 864F 09OF
general & Administrative Expenses 96F 915F
International Profit Contribution 262F 11.923U
Common Operating Costs - Manufacturing 4,17BU qD4F
ELT Profit Contribution I,IOSF 2,850F
Common Operating Costs - Other 1,763F 9.31IF
Total
a low MARGIN VOLUMEMIX for the month and year-to-date was as
Line 2 "All,
Month year-to-Dite
"":nsi Units Vol./Ni Units I
'Me nds .2 - 2.6 9
F, Play Or ejou- 6'!f73U
Low Price Brands .2 6,031V - 1.9 7,06)U
Extra Low Price .4 4,806F + 2.4 26,065F
Varjabl N&,31n Inenl1no for the month and year-to-dato was favorable
.0,4 It:ly to cigarette pricing.
Line 3 TOTAI SPECIFtC OR 11TS4 ",Z, unfavorable $27.325 for the vionth
out principallWo tiliml. h rrent month includes heavy support
for KOOL, VICE Y, RALEI N Extra and SK. The spending reflects an
offset to favorable variances experienced during previous months as
funds were reallocated from RICHLAND and BELAIR LPB.
The unfavorable $8,966 year-to-date variance is do* to higher then
bud"ted Less on Returns as a result of lower than anti clogtod
consumer offtake for IELAIR LP and RICHLAND.
Lima 8 INT1:tTjM1,qOFIT CONTRIBUTION was unfavorable $162 for the moth
as a b variance at variable margin ($4.147), due to
volva/mix. was :ubstantially offset by lower thin budgeted
advertising expenditures and favorable foreign exchange (offset
partially at variable argin).
The unfavorable $11,921 year-to-date variance Is due to an unfavorable
volume/nix resultiog ninly from volume shortfalls in Singapore, No"
ft" and Japan. The above is partially offset by )war thin budgeted
unufacturing costs and spend reductions (Japan, Thailand. and the
Hiddle East,.
*P%_299IN4 CQ1MTS3;'0"11ACTUR1 was 11,373 unfavorable for
Line 9 F
t r due to 'xp asso i ated with capital projects and
unfavorable cast variances. The year-to-date favorable variance of
3904 results mainly frm Nacon maintenance.
Lin* 11 COST OTHE were favorable $9.331 due mainly to
W, Laegil"I"N"nse, W, Damaged and Obsolete Haterials and Profit
Sharing expenses.
C)
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B.A.T INousTRas p." MWMEWA DEposffoRy Copy PWWCED ftMANT TO I VILD. OF
Co"KNT JUDGM'fr DATEI) S/M "i SrATE OF ANANNSOM ET AL V PAP AftRRN. Er A" CASE 140. C14M4"5
000
In
goo
goo
-
-
600
goo
. Last war sudoat Actuai
-
300
?so
-
-
760
700
-
-
700
Goo
-
-
060
Goo
-
Soo
Soo
-
-
550
goo
-
-
500
460
-
-
450
400
-
-
400
360
-
-
350
300
-
300
goo
-
-
250
200
-
-
200
100
-
-
160
100
-
-
100
60
-
-
60
0
m-
0
-50
-50
JAN FED MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
BROWN & VILLIANSON TRADING PROFIT
(DOLLARS IN THOUSANDS)
ACTUAL
OPERATING
VARIANCE
LAST
YEAR
JANUARY
6,357
S17,197U
($25,560)
FEBRUARY
5,310
21,563U
91850
MARCH
63,572
4,88m
79,157
APRIL
29,525
31,021U
22,777
HAY
80,957
3,516U
102,018
JUNE
94,886
4,517U
118.757
JULY
28,045
6,759U
(4,293)
AUGUST
80,484
8,218F
33,111
SEPTEMBER
42,577
31,e44U
100,867
YEAR-TO-DATE
431,712
88,299U (a)
436,683
(a) Kay not add due to reclassifications of variances. rQ
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B.A.T INDUSTRIES P.I-C. - MINNESOTA DfmffoRf Copy _ PRODUCED
CONSENT JUDGMENT DATED 518M IN STATT OF A&AMSOTAL Er AL V. PP&P Wit PURSUANT TO VILD. OF
gis, Er A" CASE No. C1.94.ggga
BROWN & WILLIAMSON TOBACCO
CUMULATIVE TRADING PROFIT
BROWN & WILLIAMSON TOBACCO
MONTHLY TRADING PROFIT
10,61
(S In Motion
ISO
ISO
ISO
Actual Budget
160
140
C 140
0 ISO
130
p 120
-
120
110
-
1`10
100
-
100
go
-
in
go
go
-
so
t To
-
70
0 so
60
Go
-
50
d 40
-
40
so
-
30
20
-
20
10
10
16
0
0
Jan rob Mar Apr may Jun Jul Aug Sep Oct Nov 0*0
ISO
ISO
C
60
1
-
160
o
4
0
Last Y*sr M Actual
140
a
ISO
-
ISO
p
ISO
-
120
"
110
-
110
1
100
-
100
00
.
90
SO
.
so
To
-
70
so
-
00
0
go
-
60
P
40
-
.
40
r
so
:
30
1
20
-
20
f
10
-
10
y
0
-10
20
.20
-so
-
-
-30
-40
L
a'
-40
ct Nov Doe
Y Jun Jul SO O
;;@r M
Jan Fob Mar
-3.
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B.A.T INDUSMIES P.LC. - MMESOTA DEPOSlTORV COPY - PNOUCED PUMANr To f VII.D. OF
ComEw JuDamEmT DATED Sam iN SrATE OF Aeywsorg, ET AL Y. mmip yagow, Er At- cAsE mo. cl-944=s
Domestic Sales Quantities
September, 1991
+or- +or-
+or- i +or-
Actual
Budzet 1990
Description
Actual Budlet 1990
Ciraretis au NOW)
2.JS7
'
("4
Fall Revenue
19.236 i (2,303)
@
1
1
Value For Money
W1
9S
(1
(130
LAw Na Bmadod
(7.32)
601
12m
415
Aaal
EUM LAW Prift
10A83! 1427 4A69,
2.
3071
Value For Mon!j
17,364; 562 3.9
m
4.9271
351 OS71
Total Ctnictior I
3GA00 (2.0141 1.135
4191 (161- 29.,S1P)%W=tF 13a 7bousandPowds) 3.799 (180 (71)
4ONS' US6! - ZM i bdw&y&dw M&142 5,7411 (a
I
5.2%1 -0.7%i -1.3%1 Full Revenue 5.2%' -02%1 -OA%'
I Value Por Mosey - 1
IM61 -0.3%1 -C Low Prim Bmaded 334%, -05% -als!
iftel A74L n 0% 1 r". 1. 9,6. Is%! OAS -'4'A:.
UW's shipments for September totalled 4.8 billion units. This better than budgeted
performance was due to the strong performance of VICEROY and particularly SK, which
more than offset shortfalls to budget for most full revenue and other LPS brands.
Industry shipments for September were 48.9 billion units. Almost one-third of
September's volume was shipped during the last week of the month as a result of
Special programs by PH and RJR. PH offered an allowance of $.60 per thousand on
purchases above an average week, up to an additional 140% shipments. Twenty-eight
day terms were also offered an shipments qualifying for the allowance. RJR offered a
discount of $1.00 per thousand an SO% of a Onormalm week. According to a number of
distributors, the "normalO week defined by RJR in fact represented about an extra
three-fourths of a week's shipments.
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B.A.T INDumIES p.LC. MMESOTA 00,0WORY Copy PRM
CONSENT JUDOMENT DA CEO PURWANT TO VILD. OF
'MID WSM IN SNU TE OF AbWsorAl Er AL K PNXIP AFMM. Er AL_ CASE No. C1.94.M5
Dazx:Loot4o Clgarotte Q%Xft=t1*AOw
Legend
00
T
T
" V"r
6
act
0
40 f
.
.40
t
MCI
1
30
T
20
t
6
T
-A
01
@
'j
1
0
Segment Analysis
I" Ism
C=)
LM VAX
I" taw
co
c@
c:11
4
00
B.A.T lmxnnm P.LC. - MINNESOTA DomffM Copy PWWCED PUMIUANT To VILD. OF
CONSENT JUDGMENT DATED WW IN STATE oF AtowsoTA, ET AL v. PmLp Afogift ET CASE No. CI-944=5
Domestic Sales Ouantitles
September, 1991
+or- I +or-
Rudret 1990
Full Revenue
96-0
(76)
(23SIX"
Mats
7.143
(8701
(9441
369
M
(721
Lents
2.7M
'3
(31
(3271
156
W
(24)
saff
I.W
(2
]
12
0i
(A]
Replar
too
17
171
(IS
261
(65)
(991
Mad Yjap
1.013
(S?p
("4
71
.
(121
(31)
Mild Lents
S20
25
(123
(56
1
$1
(4)
(30)
Mild Box
"S
(56
(25
47
61
(10)
LISM Xinjs
$51
38
(491
39
4
(7)
Ligbt Lents
287
22
(31
1
1
3
7
(2)
Ultra LISM Kinits
215
U
(22
31
7
1)
V
Ultra IjSbt Lents
220
3
(251
1
(1)
(1)
Deluxe LJgbl Fints
6
(9
(8)
1
(0)
(3)
Deluxe Lijbt Lents
9
(7)
(71
1
(0)
(1)
Deluxe Ultra LISIst KJoSs
5
(3)
(8)
2.
(01
(11
Deluxe Ultra lit t Lariff
01
1`61
-- 16A
L037;
(148)
(324)
Total Nool
15,055!
(SAMO
(1.9311
48.
(10)
(39) RaWiSb
Kinss
&11
(1291
(V21
212
M
(9
1
(271
Leap
910
89
1
(302)
(9
(
(39
1
9
V I
(7)
plain
(4)
11
(
lit
t" t2l
a
(31
(64
IS1
191
,
Lit
$4
02
--08
112'
(291
(oil
Total fteleisk
"i
L3121
(665
311
1
(241 Debit
Kints
4241
1
34.%.
0
(it]
Lents
277
132
S4?
8
023
Total
7011
(14)
f3OD
40!
(11
(17)9&rday
Finr
325
(2
(781
261
(:1
(111
LAWSS
216
(31
(67
231
10i
f2l
151
Sam
94
(11
(
76
(5)
(31)
Total Jurdey
6331
(68
(1
V
(4) Capri
JIM
8015
6
(156
(5)
(9)
Menthol son
648
16
(161
(
@
251
(4)
211
We
213
1
1
(3
176
0
I%
141
191
Menthol l2n
1
36
2"1
___
(111
27!
Total 0wri
IASI
1275
1 270
L557
lion
(66411 real Pon -it-VArge
19.2"
(2.S76)
M803
Value For Money
L4*w Price Branded
280
2:
5 viveray
Mup
IAU
(412
(561
171
1
23.
35
Lems
L110
(99
to
7
74
13"
is
Litht Xinp
3
67
211
23,
Light Lants
(2
71
43
4 (261
BOX
306
4
236
25
(1) (331
Litlit box
179
(21
119
4
(11
so I ants
29
1
9
23
V
0
M
Liabi Dow Lonat
14
(0
to
- "71
61
rolral
4J261
g"I
$20
C
(17) (
12) "air LPS
Kiap
114
(79
.(140:
8
1
(19) (
13)
Lents
136
1 (a)
V.-)
7
1
(16) (
1%
l
Ligbt ftp
120
M
(1261
11
(161 f
lil
-- light Lots
183
(471
WMI
33
(56)
Total J101sir
$631 (542)
,
-so-
00
C)
C.:)
B.A.T Mmmms P.Lc. MmEsou DeNwony COPY PRODUCED PURSUANT To I VILD. OF
ConEw Juoawwr DATED WNW IN Sun OF Aftmwsou. Er AL V. PHXP AfORM, ET A" CASE NO. C144-MS
Domestic Sales Oultutitics
September, 1991
r'.,rwont Unrith year-To-D&I
+ of
+ or
I
+ Of -
+or-
Actual I
Budget
Im
Descriptiop
Actual
Budget
im
27
(36)
(29) RiCbIAW WA Kings
3.38
(377
(138
32
(391
V34
Loop
372
(
307
(189
VU I
sea Lonts
(
w
-
(11)
DOE Kings
(
139
1
(III
(IS
Menthol Kings
16S
(49
'
14
(
121
(12
1 Menthol tons$
164
46
(
41
13
(
16]
(13
Light Kings
171
67
se
20
(
221
N
Light Loop
2411
(303
(
419
1211
(1
961
(117
1 . 7nialRichlead2ft
IA501
(297)
(5
"j
9
(2)
(4
.Ritbland 23's Kings
75
(12
(40
1
4
1
(2)
(6
Loals
121
(51
1
Menthol Kiess
90
1
(7)
(2j
0
Light Kings
17
(4
(9)
.
3
(21
f2
l light Longs -
.14
(3
1
41
-a
31
OL
(13
1 Total RkAland JVS
3421
-- (291
0310
(195)
(180
1 761alLow Prke Mrsaded
(I."Sl
(7321
Extra Low Price
95
39i 31
OPC Light Kies
04
225
204
in
S6 47
Light Laos
179
281
IS6
so
Is! 16
Ulm King Menthol
3w
92
$6
37:
4 32
Light Long Menthol
5"
186
IGI
33
21: is
Ultra Kiss
383
128
115
$41 44
Ultra Lost
sit
311
28s
isll
84, 66
Full Flavor "S
L004
43A
390
151
64 72
I'VII Flavor LOD$
389
3S9
2
1
12 so
Full Flavor King Menthol
,
iss
61
78
ss
73
27
is! 16
Full Flavor Loons Menthol
2
21 2
Full Flavor King Not
1
2
2
2
2
2 2
Lisht Kin$ so
2
2
21
Is 3
1 plafn
428
128
04
1
446 31"
1 701810. P. C
GA31
Ln-1 I
- 2,214
97
(11 SI
Rakish EM MOSS
$61
46
493
109
201 26
Locals
930
is?
$90
it
(9) 11
Flab
135
(4-
135
60
(101
Light Kings
330
273
92
14' 1:
Light Loop
696
120
QU
20
(31,
(26)
Light menthol Kings
183
(186
25
31
(141 0
Light Menthol LAMp
20
(97
97
131
26
(18) 13
12! 26
Uhr,
Ul =.
22s
- 2811
- 1521
T
4501
(21) 119
--
1 709d X91040 BrIf's
4.3001
106
6
21511!
1.389 1
41S: 488
1 rots/ Burs Low Prke
10,493
T 2.427
4'IW19
19
2.2701
220 $07
1 Total wat For Mossy
17,3641
562 f
8
3.
is (irnOrawd Total Cizeretses
4J27
1
36.6001
M014) Ism
-
--
sneeialty Tobacco Products -
l
t
in Thousand of Pounds)
1
72
(si
(3
F"
692
(74
1
2"
0:
33
Roo yoct Own
L317
109
4S
(9)
'3
Cbevrial
432
37,
(3)
4
Snuff
Ss I
419
(161
29.
Gresd Total STF
3.799 i
(186)
(71
INV
-3-
CO
%C
B.A.T Imusmas P.L.C. UMMOTA DVOWM COPY - PRMCED PURSUANT To VILD. OF
CONUNT JUDGIAENT DATED 518W IN STATE oF Aftwsou, Er AL v. PHILip Maggs, Er At_ CAsf No. C1444M
Marketing Expense
(Dollars in 7"nousands)
September, 1991
SpwgL- BoadFip"M
7=
A&NIWM Me&
67AS2
40A9
45.746
?41=1
Sam PA dn SOW&
MR6
2DI571
14122
iss
-
C0%= Pmmtiw
LM
I"?
$3,133
(A=j
7*W WOMROMM)
11,676
270,417
153jo
7"
a=I
LAw ca Retwu
(MAW
GO."6
39337
L 60=21
W.325)
TbW SPwI& Bras d FjP68w
(8,M)
331,3S2
.
ZLS.2051
Total Harketino Fxnanse was $25,462 unfavorable for the mouth due to higher
than budgeted discounting for M. VICEROY, GPC and RALEIGH Extra. The
increased discounting support for KOOL, VICEROY, GPC and RALEIGH Extra was
funded by a reallocation of funds for BELAIR LP and RICHLAND.
The unfavorable $8,078 year-to-date variance was due to higher than budgeted
Loss on Returns expense associated with higher return units from the trade,
primarily BELAIR LPB and RICHLAND. The favorable variance related to Specific
Brand Expense (before returns) is due to the timing impact of the reallocations
noted above.
-6a-
PIJ
B.A.T lNoLwmas P-I-C. - UPINEWA DEposffoRy Copy PPAMCED PURSUANT To VILD. oF
COMENT JUDGMENT DATED &WW IN STATE OF A#INAfE$QTA, ET A,. V. PHILP AftRRK ET CASE NO. CI-944MS
1 81.9121 (26,462) ToW Markedge Ev"" _-am] 317=1@@
Specific Marketing Expense By Brand
(Excluding Returns)
September, 1991
Cmirrent Month Yeat-TO-Date
Actual I
OVUrrinantienel
I DE!Sj2tiou
0vtormiawtineS I
Actual 1
1990
Ad/Aawarse,
1SX3
%-3,W
Koo)
PAK
7903
*P7
77
Rawsh
-
on
2.94
5S
Dow
sw
1,791
1
Barclay
14
W6
3AZ
11681
capi
Z737.
31.1"
27,486
39011
MO16)
TotalFaVA"W"
("93
113,8W1
801008
Value For Money
I LOW Psice Aranded
1079
OZON
Viceroy
(13,W
634"
2LAI34
i
201, -
i
Helair
IU13
1
6.214
3=8
l,TM1 -- 1.712
ffidgand
31LOOS
7
2D-97
ISNO
18,749. (11,1761 Total Low Pdw Breadad 1
26&30: gams
67,332
EnraLo"'Nim
7,Z11
, @
G.P.C
1
(9,483
1
22M
19.773
7,2121
2
zz
adk-m
.40.736
K738
-
Total Eon Lew PWw
14,116 63
J30 1 UAIAI
XG WIS
so *A%
133 14%
1U8D 7AS
"1 &4%
Is= a"
MAID SLOO
410" 242*
@
M"i
1,306 us
7464 2J%
W 13%
9.1" 14%
am JIM
4" &4%
MOO,
]AID !L?th
iin aft
un L"
7wd AAhWOAU AfeWs
$7.432 sQO%1
IL71t---
414ft-214%
mm" off =-8 A VPX Payesou
143.413
SU%
tO2.1"
372%
SL334
41,0%
Fw G**6 nd SavWks
7.767
2.9%
7.115
LJ%
L1,702
6.4
:
b9meftis
27jW
IU*
1
3D.718
10%
Aw
302
Frowetwol Frywasu
3.319
12%
1401
JJ%1
JU.M
L2%
2DA32
1A%
4&60
14.4%.
ILMS
&6%
71001 Ptemol" 90"k
MLS71
7=1
'"A'
'W,111
344.122
77.5%
r*J
Pftw*JO 0
1 JW3
- a;
&W
3-W
-
am,
Writ Zrateaw
111,W
Im""
CO
Ln
NJ
BAT INDUSTWS P.LC. - AlWaWrA DOMIrDay Copy
CONSENT JUDGMENT OATEt) &WO IN SrATE OF AgIMMSO , AL - PRMCED PURSUANT TO I VILD. oF
TA ET V- PMtP AkRR% Er A" CASE No. C1.94.M3
By Major Categmy (BzdWbt Len as Resvx=)
Year-To-Dase
(DWkn Is 7b"naft)
Brand Contribution
(Before Returns)
(Dollars in 71ousands)
September, 1991
Curre
nt montil Y
ear-jo-up
ic
Actual I
Operating
Variance
I DescriRtion
Ope!afing
Variance I
Actual I
L@asl Year
Fafifie"five
6W3 (9.7531
Kcal
(67AW
489,100
SOZ736
4X6 (LON1
1talc4h
(11.109
3S.912
50.422
3.198 321
Belair
(202
25,666
2JW (I
Barclay
(Z1431
W068
24,542
4.479 1JU7
Capri
(6.9161
29J95,
2=81
75,741! (9,651)
To:&1Fa11Rmzw 1
(07,"7)
6113@040!
630,4651
Low Prke Smaded
2.9181 (9milviceroy (13.956) 39,716 suss
M i (1.692)BelairLPS L326: 8.39 (m'all
VXV r2A6111tichland 1 9.1181 24.464 @
3041
(10)
pip
314
1
Z=
Z347
-YOW-002
10,418
1
8.554
W
1
M
Tobacco
191
11"1
1.142
74
it
snuff
-
(11
494
L714
L732 i (1421
7p&qjR?XWW
q-
Q10
15,14SI
14X7
89,mi f"-M1
rh&1AA1PWodw&
1
Brand Contribujign was $29,157 and S70,630 unfavorable for September and the
year-to-date due mainly to selling less units than budgeted of Full Revenue
(118,169 month; S96.773 year, mainly KOOL. RALEIGH and CAPRI) and Low Priced
Brands (S6,032; $47,061. mainly VICEROY and RICHLAW). Coupled with the
unfavorable volume variances for September were higher thin budgeted marketing
spend for KOOL, GPC and RALEIGH Extra mainly discounting. These variances were
reduced. somewhat by favorable volume sales of Extra Low Price brands (S4,806
month; S26,055 year) mainly GPC and the impact of higher than budgeted pricing
(S33,059 year).
r*J
C:1
C=
C"
111)
k.011
B.A.T INDUmms P.1-C. - MWOMMOTA DpaurM Copy PWWCED PURSUANT To VILD. oF
CONSENT JUDGMENT DATED &WIN STATE OFAftwSOTA, ETAL v. PmLv Akggm ErA CASENO.C1.94-6565
M , (19,364) TotmINImForMomey I 1w; 14S @7631 @1
(133) - I Now Product D;;@@Z@at 1 250 0") -(us-l
t. ev-Mraff I ( a -
Q@Wlv lrnb@ Pondeeft
-Current Moutb Brand Contl&Ution Year-To-Date
price :
Cost -
Volume/
1
Variances
!volume/
I st I
it
Price
,ka
L res ,
Charts
Mix
=1
mix
C
l
"LL
OIRILLu-S
I
Fail Reweave
I
I
3311
4s.
(6.432)
(3A97
Kow
(3.696
(70.073
I
("11
6.90
331
(Ij
(1.106)
-
Rweigh
(11
jo,
(6
4191
it
01
310
i
-
B",
-
(497
6
30, i
3621
6
!
01
(1781
-
Sudsy
(2399
(
1
:
3
1
t7i
(7621
1.4111
calri
L737
(12.245
1.726
8"
140,
(5,34111
-
-(2,016)
7welFORRem
It")
(%.7731
1111131
SA10.
Valso For Hasel,
2.361
tul
$22
32111
"di
16
so!
952
(1.036
(MW
1.712
Law Pd" pleaded
V10"
adair 1"
Riewand
(13.M
6ji3i
(.(73;'6021
(47,ft1j
1.161
148
484
1,792
12.1"1
1.129:
3A341
36,727
(1.1
1.gn@
650 @
iss
71,
_ U7
3.2171
1411
4AM:
I
(ulgi
(4.632
(31,451
Artre law Pries,
onfalcowEK
RaIdgb Extra
701#1 liters
(0.4631
(14, 141
24."1
34A311
3"
L"I
370
(3AII
IQJJ2'
7.271
e-'-fty llpbawe ifte4g".-
,
(26)
npc
336 (So
1
49
13
4
(16i 61 (42
Itall-your-ow"
(494
4
l
cts@
(
1
,
10
i
is
(1)
CbrAsSTabsom
Pit
326
106
m
(31 (131 -=
1001"
fil
fit
:08
fi
ll f6li r7t)
T.., 37-p
P.4"Is
471, _116A
mi
-2"
4307i 71
10 19,440) a4-TUI
-
Total AH Prodear 31.4-
.
Rates Per M
2101
L" Vow
A
_'AW *.a"
nd c
l
awmauggs
VOW*
I
0
010111MAN
I D ption
V"W.
Hills
a
V.041
S.
al'i
=
L"
SIM
I"
um
to.
34M
3143
in
Uzi
V.44
an
@
XM
32.36
&.11
"
Rabilk
l
Mi
:
VJ1
3L"
Lp
32-43 @
37.33
C72
I
MAI,
sais
1
L"
3W
Sebir
31,43
VA
"
am
r-40:
31.21
am
an:
"
Lit
30A
Neviby
Xx
xx
XLDB
46111
KA:
21AD
Ile
%Lr.1
an
It"
tsaa
gd
SIM
ILM
30.39
30.07
UZ
37U
Lane"
4.31,
33MI
SLI41
2.1s
3111.39
Vain Par Mae"
too eft"W
V-0
"M
U211
2m
am
I
@
OA
I
31A
a"
SIM
1
HAS
I
Hot
IRV
l
30,42
1
1
(
Mif
35-W
I
lix
IVI
31.14
31.24
(G."i
21A
IIA
I
Up
Itsi
@
.,
_"_
am
I&A
1SL73
UM
HA#
LAW ftw
:
WWI
3Mj
1_!
1
-
I
&a
J
rr-
14.34
1,11
1.231
-1
UP
340
W
S."
-
Up
,
I
R4110
I
&A
473
Lot
1SLISI
Lot
1413
L"
Cell
Lit I
T0401 Ban LOW Pries
IL1011
LOS.
S."
L.91
5.261
Us
I
'VkwPartleasy
S4.11i Upil am, T."
17.331 0.917 IL44
4.641 4L60; 4,03' &1141 IM 3.171"? 1.": 3.941 4.101
-7-
C:)
co
C)
C-)
%D
(-n
jbb
BAT INOMMiEs P.LQ MINNESOTA 08,0WORy Copy pWDUCED PUIRSUANT TO I VILD. OF
CONSENT JUDGMENT DATED _5/8W IN ZATE -OF AORMESOTA, ET AL K PPKIP AIDIRRIS, ET AL. CASE NO. C1-944=5
fl.)
C-:l
co
C)
No
f-n
BAT lmxwnmEs mL& - MINNESOTA DevsffoRy Copy - PRMCIED PURSUANT To I VILD. OF
CONSENT JUDGMENT DATED &M IN STATE OF Aftmwsom ET AL v. PH&P Afogm, ET CASE No. CI-9441665
DOMMC GENERAL A ADMINISTRATIVE EXPENSES
(DOLLARS IN THOUSANDS)
SEPTEMBER. MI
CU
RREW I MONTH
YEAR-TO-DATE
AC
TUAL
I VARIANCE
VARIANCE
1ACTUAL
ILAST YEAR
2=5
47
SALAAM A EIAPLOYEE WELFARE EXPENSES
672
22.946
21."2
431
0 23
OTHER EMPLOYEE RELATED EXPENSES
428
SPfi
4,W
1,171
66
GENERALOVERIMAD
708
10.417
loto3a
oil
216
COMMUNITY A INDUSTRY RELATIONS
329
SA6
5"
2.152
0 66
OUTSIDE SERVICES
19
11AX
10,321
ju
0 113
MISCELLANEOUS OPERATING EXPENSES
20
3.W
2.830
011)1
- 31
TRANSFER CHARGES
38
0.81111)
(S.S73)
@
MAL DOMESTIC OEM" A
um
96
ADMINISTRATIVE 00VISES
91S
j"TFS & EMPLOYFF WELFARE giPENSES war* unfavorable $572 for the year-to-daft due
mainly to higher Employee Welfare expenses primarily associated with Ponsionst Payroll
Taxes and group Life Insurance.
011111 OF1 RELATED EXPFKSFS were $428 favorable for the year-to-date due mainly to
fa"rab§10 fj ce Supplies expense.
W was favorable S708 year-to-date due mainly to favorable Norio*
=C14911scounts and Naintenance expenses
SC"LAN I I FRATING glPENSIS were favorable S249 yaar4o-date do mainly to
orabl e%d poebts and Postage, offset So sid at by unfavorable Product Process
V
Developm"t expenses.
C)
co
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B.A.T lNousTRIEs P.LC. - MMLWrA DEPOSffm Copy pq=CEI) PUMAKr To VILD. OF
CONSENT JUDGMENT DATED SON IN SrATE OF AbINESOM Er AL v. Pmxp Alongft Er AL, CASE No. C1.94.M5
STATEKENT OF INTERNATIONAL
PROFIT CONTRIBUTION
SEPTMOER 1991
(DOLLARS IN THOUSANDS)
CURRENT NoNTS
YEAR-TO-DATZ
VARIANCE
V
ARIANCS
LAST
ACTUAL
AMOUNT
%
DESCRIPTION
%
AMOtwT
, ACTUAL
YEAR
3,118
0 421
* 11.7% J
rXPORT/COMT. VOLQxEs
lW 13. 0%
4.296
25,644
28.042
2.330
9 123
* 4.7% l
LrCSMStZ VOLUMES
7.4%
1,795
2s.644
21,936
3,708
544
* 1.7%
TOTAL VOLUMES
4.5%
2.531
54,217
49,979
$6,287
1,S32
v 13.2%
NET SALES VALUE
13.3%
77.397
SOS,336
471.867
29 27J
;01.6
4,147
0.4%
* 12.5%
VARIABLE MUCRIM
% OF INVL SAM
11.9%
35,161
Q.1v
260,710
51. Sim
239,723
so.8%
9.394
2.440
20.4%
SYSCITIC BRAND
ZxPZNSt
10.6%
9,576
81,042
74,957
323
1.543
12.7%
LLING CONN. /juAlow/
RZTMtNS/FORZX= EXCR
LIZ= RZSEARCv---
70.2%
11,044
4.694
4.945
2.708
122
4.7%
LICENSER INCOME
3.5%
711
23,053
20,968
1.929
335
# 13.9%
@ELL=g rl=
0.9%
243
15.739
13.843
20,091
276
0 1.4%
REGIONAL Com.
7.1%
231pos
1112.350 1
166.945
1.111
11$
5.9%
ZNTIL sun NOT
9.3%
1.505
14.59S
14.438
1,244
438
26.0%
m/m/mARM lestj
4.5%
$13
10.937
9,043
Ito
2
9 0.2% I
AMORT OF TRADEMARK
J
. 0.3%
- 27
8.199
8,196
(6)
11
MA
-
MISC. IINC)Itxp
34.0%
---
1
(15)l
21
16,054
263 1
1.7%
rMT'L PROFIT COM.
7.4%
11.922
141,641
135,247
32.9%
I.J
I
% Of TOTAL DOMESTIC
& MIL CONlRIW.IOK
1.9%1
24.3J
22.7%1
NOTEs AN ASTERISK INDICATES AN VNFAVORA3LE VARIANCE. *TEMPORARY& VARIAMCZS
RAVE SEEM EXCL=CD. 9a
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114
B.A.T ImumlEs P.I-C. MW*SOYA DEPOSITORY COPY - PRODUCED PURSUANT To I -VILD. OF
CONSENT JUDGMENT DATED 5/8M IN STATE OF A*AMWSOTA, ET AL v. Pmxip Akggx, rr CASE No. C14M4W5
international Profit Contribution of $16,054 is $263 favorable for
the month. Year-to-date Profit Contribution of $148,641 is
$11,922 below budget. Major variances are outlined below:
Variable Margin of $29,027 is $4,147 below budget due to a
$5,059 unfavorable volume/mix variance and a $912 favorable
rate variance. The unfavorable volume/mix variance is due to
below budgeted volumes of 422 million units, coupled with
unfavorable mix in the Hong Kong Group ($1,465). The largest
volume variances occurred in Singapore where volumes were
down 164 million units ($1,603), and the Levant Group of 277
million units ($1,713). The favorable rate variance in
largely the result of lower than budgeted manufacturing cost.
Y&ar- dato Variable Margin of $260,780 is $35,161 below
budget due to a $42,968 unfavorable volume/mix variance and a
$7,907 favorable rats variance. The unfavorable volume/mix
variance is largely due to below budgeted volumes of 4,296
million units. The largest volume variances occurred in
Singapore of 1,207 million units ($12,088), Hong Kong of 774
million units ($8,720), Japan of 344 million units (66,202),
and Thailand of 212 zillion units ($2,764). Also, the Levant
Group is unfavorable ($1,670) as below budget volumes of
1,007 million units are partially offset by a favorable sales
six. The favorable rate variance is largely the result of
lower than budgeted manufacturing cost.
Advartisina Expenditures are $2,440 favorable for the month
and $9,576 favorab2o year to date mainly due to spending
reductions, primarily in Japan ($4,149), Thailand ($3,055),
and the Middle East ($1,820).
SmIlina COMMiss ions /Allowances /Loss on Returns/Foraian
Exchanao and Market Research are $1,543 favorable for the
month and $11,044 favorable y*ar-to-dato due to the
following:
Foreign Exchange is $977 favorable for the month and
$7,591 favorable year to date mainly duo to gains
associated with foreign exchange revaluations, offset
partially at variable margin.
Selling commissions are $1,943 favorable year to date
due to lower commissions in Europa (mainly in Romania).
International Brand Xanaaanant is $1,505 favorable year to
date mainly due to spend reductions, primarily Lucky Strike
($412), Barclay ($364), and Kool ($347).
P'..)
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349.1
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27.9
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24.3
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STATE OF AftAmsom Er AL v. Pmx?-42M ET AL. CASE No. C14M4M5
1XVIRINATIGNAL SALSS OVANTITINS
urrsen u9i
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CUILLICIT
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VAR:=Ls
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51.6
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226.5
$64.0
460.9
121.4
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8.9
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272.2
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240.0
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5,581.7
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1.310.9
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28,041.11
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SMOM XKFGST. GUINTRAM, MM ZMVDM SAM 00111TUR VA2ZWCMS
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0 497.9
37.9
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166.9
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13.8
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12.4
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61.2
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143.9
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B.A.T 1NDusTREs P.LC. - LMNNESOTA De"ITORy COPY - PAMCED PUVMANT To I VILD. OF
CONSENT JUDGMENT DATED SAM IN SrATT OF MAWSOTA, ET AL V. PMLP AfORRAL Er CASE No. C1.944=5
E)MRT LEAF TO9ACC0
STATEMENT OF PROFIT CONTRIBUTION
CALENDAR YEAR swis
71
SEPTEMI&M. '19111
MtV I ANN INTWMISAMOIn
CURRENT MO
NTH
YEAR-TO
-DATE
I
CH
AN1
3E FROM.,
VARIA
NCE
I
ACTUAL I
AMOU
NT
I
DESCRIPTION
FAMOUN'T
ACTUAL
LASTYEAR
21,9171
. 9.995
1 31.3
NET SALES POUNDS-M
am
30.1 1
.202
29
103303
$5.551
5.7721
3A39
1 1911.7
SPECIAL ACCOUNTS
-9.0
@
7.339
21,195
13.265
4113
-
- 222
32.4
STOCI(PILE
21.
,
I.W3
7.374
17,351
Sol
se
l -
I OTHER
11-9
4
1"
1.497
1.939
28.M I
C339
W3
TOTAL NET SALES - POUNDS
376
VAN
133.889
119 06
.006
M
46=5
21.93v?
32.6
NET SALES DOLLARS
Sw
402
0111.71111
216.217
IU,409
15.0641
10.125
04.8
SPECIALACCOUNTS
411.9
2",731
U.652
U."s
IA78
717
317
STOOMILE
21.8
4,176
==
U.928
8
91
-
OTHER
5.8
2U
4=
5=
Slim
ILM
16.1
TOTAL MET SAI
39.9
IrAge
30GA31
237.441
1"I
IMI
12LS
GROSS PRORT ON SALES
40.4
2.706
9AD9
loAll
SELLING
& ADMN, AND
2621
201
7A
OTHER ONCOME) & omom
4.6
143
2.037
1 sm
116791
1,1061
19Z7
PROFITCONTRWVTION
W
&Wl
7=
"US
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-118- C)
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B.A.T INDUSTRIES p.Lr_ MINNESOTA DEpoSffM Copy PRODUCED ftWAI To VILD. OF
CONSENT JUDGMENT DATED 5/&" IN STAll OF AfAWSOM ET AL V. PNLV Akgm& Er ir CASE No. C1.94.WS
AL.
"'PORT To
WMAL TS OF OPFRATIONS
Rag
5FPT &OS@
MOULAURLS-7111RE
Profit Contribution was $1,106 favorable due to the following variances:
Special Accounts Gross Profit was favorable $1,336 due primarily to favorable
timing differences on sales of domestic flue-cured strips to Hong Kong ($1.081)
and a favorable timing variance on sales of flue-cured products to Holland
(S334).
Year-to-date Profit Contribution was $2,851 greater than budget due to the
following variances:
ip*cial Accounts Gross Profit was $2.349 favorable due primarily to favorable
timing differences on sales of domestic nut-cured strips to Hong Kong ($1,061)
and Increased sales volumes to Germany ($477) and Hong Kong (S354) of domestic
burley products.
Stockpile Accounts Gross Profit was $650 favorable due primarily to realizing
$962 gross profit on unbudgeted sales to WAE partially offset by unfavorable
timing variances on sales to other Stockpile accounts (S219).
C@
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C B.A.T INDUSTRIE3 RLM - ANNNEWA 06,MrrORY Copy - PRODUCED ftWAXT To VII.D. OF
ONSENT JUDOWNT DATED 5/11M IN STATE oF A&AMSOr4 E-r AL V- PH&P MMRML Er-AL, CASE No. Cj.".M5
COMMON OPERATINQ COSTS - MANUFACTURING
(DOLLARS IN THOUSANDS)
SEPTEMBER. 1991
C
URRE
NT MONTH
YEAR-TO-DA
TE
ACT
UAL
I VARIANCE
ESCRIPTION
VARIANCE
ACTUAL I
LAST YEAR
14.659
* 1,730
OVERHEAD SPENDING
1.934
106,988
94.004
1,424
' 685
COSTVARLANCES
267
3AI
2.661
2=
- 1,701
INVENTORY ADJUSTMENTS
1,649
(16.4n
(10.739)
3.89 1
' So I
DEPRECIATION, RENTS, ETC.
097
31.363
29,643
1
TOTAL COMMON OPERATING
2LF/0
4,178
COST - MFG.
9041
1215,144
115.969
OVERHEAD SPENDINJ was Unfavorable $1,736 for the month due mainly to the expenses
associated with ca projects. For the year-to-date, overhead spending was $1,934
favorabl! due maiNy1ttan maintenance ($2,821F) resulting from reduced fixed plant,
- nd fabrication spending, and salaries ($1,310F). resulting mainly from less
than budgeted manning 1 vals; partially offset by expense associated with capital
projects (S2,521U) as n:ttd above.
COST YMIANC were $68S unfavorable for the month due to labor and wrapping material
substitution variances ($286v).
TWWORY ABMSTKW@ were $1,701 and $1,649 unfavorable for the month and
year-to-date respectively. Variable manufacturing cost standards changes required a
decrease In the value of existing finished goods, which created an unfavorable offset
In inventory adjustments.
DEPRECIATION- RENTS. ETC. were $887 favorable for the year-to-date duo to
depreciation and amortization (5795) resulting from lower than budgeted
capitalizations, and lower leaf storage expense ($246).
cc
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C BAT INDUMIES P.L.C. - MmEWTA DOMITM Copy - PRMMD PURSUANT To I VILD. oF
0"WNT JUDGMENT DATED 5/601 IN STATE OF AllpmSoTA, C.T AL V. ppKip NWRM Er A" CASE No. C1444M
CIGARETTE PRODUCTION PER HOURLY MAN HOURS WORKED
$0000
$0000
2800
-
Dwunc P.
28000
-
26000
h
A
0
2400
TO
-
24000
0
U
22000
'BXPCMT
22000
20000, ........... 20000
JFMAMJJAS0NlDJFMAMJJAS0ND
1090 1 1991 1
CIGARETTE PRODUCTION
(DOMESTIC AND EXPORT)
10
10
TOTAL
T
v
.
4
4
owsom
A
2-
.
2
. .
. . . . . . . . . . .
0
FMAMJJASCNDJFMAMJJABOND
"Do 1 001 1
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B.A.T INDUSMIES P.I-C. MINNESOTA DoVgffM Copy Pnm ANT CASE No. Cl-944IM5
COMENT JUDGmEwr DATED 5/8M IN SrATE OF A*AMSOTA, Er AL V CED PURM TO I VILD. oF
PHEIP AfORAM ETA
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BAT INDUSTRIES P.Lc. - MINNESOTA DEposffm Copy - PRODUCED PURSUANT To I VILD. OF
CONSENT JUDGMENT DATED SON IN STATE OF MINNESOTA, ET AL v. Pmxip MORRIS, Er CASE No. C14M4M5
COMMON OFERAT]NG COSTS - 071MR
EXCLUDING C.Q.C. - MANUFACTURING
(DOLLARS IN THOUSANDS)
SEPI Dealt, 1991
CURRENT MONTH
YEAR-TO-DATZ
ACTUAL
VARIANCE
DESIZREMON
VARIANCE
ACTUAL
LASTYKAR
4.7S7
W
COMMON OPERATING COST' - CORP.
6.3"
4S.5a
35.3"
1.317
985
PROFIT SHARING
2,736
13.347
0.06
so
104
OTHER (INCONM A WMWSE
291
(nal
(Igo
I
(EXCLUDES INTEREM
1
6,124
1,764 1
TOTAL BWT COMMON COST
9,331 1
- 59.=6
49,616
r"&TIme PFA?r
cook" 0 --,- --*.- - CORMW were favorable $6,304 year-to-date due mainly
to favor 10 Legal Pro ioa-l hes, Damaged &Obsolete Materials and Research
and Dove opment expenses. The $883 favorable variance for the month was due to
I ower Re *arch & Development and Damaged I Obsolete Materials expenses.
PROFIT 2JABING was favorable $985 and $2,736 for the month and year-to-date,
respectively, due to reduced Trading Profit.
-13-
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BAT Imusmin p.Lr_ - MNNEa"A DEPwITM Copy
CONSENT JUDOWNT DATED &W" W SrArE OF PRMCED PURWANT TO VILD. OF
A#NwSoTA,- Er AL Y. AM P AkRRB- ETA" CASE No. C1.9441"S
r%)
C)
C)
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114
B.A.T lNousmas P.LC. - MINNESOTA DOUNTOW Copy - PMWCED PuRwAKr To I VILD. oF
CONSENT JUDOWNT DATED $IBM INSTATE OF Af#NWBOTA, ETAL V. PHLIP AfORRM ETA CASE NO. CI-94-ONS
COS
"I
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B.A.T INDusTRas P.Lc. - Mmum DoKwm Copy - PmmcEo PuRsumT To VILD. oF
Comew JuDamEmT Dam SIM im STATE oF AI#NwsoTA, ET AL. v. PHXV UORRIS, ET AL CAsE No. C1444M
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B.A.T INDUSTRMS P.LC. - MMESOTA DOMffORY COPY - PROOMED PUR8tJAmr To I -VII.D. oF
CoNsENrJuoawmTOATEoS/&UimSrATEoFAfimwsorA.ETALv.PmarAknow.ErA CASENO.Cl4M4W5
SUMMER, 1991
NET ASSETS AT END OF MONTH
(DOLLARS IN ME=NS)
991
4j-
S"ftmbw
Agaw
NAW
1990
OPERATING WORIMG CAN rAL
CURRENT ASSETS,
-"nd" Cubmw" TOM bwaswmb
s -
-
-
4cmu Re=Mble
244.5
-
".9
-
29.6
Hot Invewm
369.0
+
74.6
+
68.0
Odw C*nw
16.2
+
0.3
-
03
TOW CWTM
63.7
*
35.1
+
32.7
LESS NON-DMrr NON-TAX
CURRMT LtANMXMS
B=kO"Idmft
6.2
4.3
-
7.7
Acwmu P*yoWA=rnd LWAndim
251.7
17.6
+
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+
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+
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+
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351
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+
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$44J
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+
76.1
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M.1
2.0
*
At
Nat Find Amm
46.4
19A
*
37.2
CapiWbW Lmen, Nd of Anatudes
11.6
+
6
11.
+
1
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+
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+
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-
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1.7
u
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CoNsEmT JuoawNT DATEo SWU iN SrArE oF Wmscm Er AL v. PNLP MoRges, Er AL CAsE No. C144-Ma
NTARY NET ASSETS
V
a 3C
(Dollars in Millions)
Z
>
S2PTEMB2R 1991, VERSUS BUDGET
Not Assets were $17.2 higher than Budget primarily due to the followin
Accounts Receivable were $39.9 lower than Budget due mainly to lo
Domestic ($24.8, due in part to higher than budgeted EFT
participation) and International ($14.5, resulting from lower salo
Accounts Receivable.
Net Inventories were $74.6 higher than Budget due primarily to his
Leaf ($39.4) and Domestic Finished Goods ($26.2). The Leaf inven
increase was primarily due to the timing of the receipt of offsho
and oriental tobacco ($19.0). Also, impacting Loaf inventory war
lower usings, ($15.0, due to export production being lower than
budgeted through September). Domestic Finished Goods were higher
to greater overall quantities (+1.7 billion) including higher the
anticipated tax paid units (+1.4 billion or $14.0), both a functi
of timing, relative to the expected year-end positions.
Accounts Payable/Accrued Liabilities were $17.6 higher than Budge
primarily due to a higher provision for advertising coupons, ($12
resulting from higher cents/dollars-off coupon activity.
Not Fixed Assets war* $19.4 lower than budget due mainly to the
timing of spending and the actual 1991 beginning balance for Not
Fixed Assets being lower than estimated in the 1991 Budget proces
($9.2).
Capitalized leases relate to the Japan vending machine program.
capitalization of the losses was not budgeted.
Pwwions/Defe=ed Compensation was $17.2 lower than Budget mainly
a
u
to higher than budgeted pension funding.
21210P221212- 1061 VV"= ERPTMRR. 19#0
t Assets war* $46.1 higher than last year primarily due to the
r6llowing:
Accounts Receivable were $29.6 lower due to lower Domestic Accounts
Receivable ($53.2, mainly timing of sales) offset by higher
international Accounts Receivable ($22.9 due to higher sales).
Met Inventories were $68.0 higher due to higher Leaf ($60.4). Losaf
inventories were higher due mainly to increases in Turkish Leaf
($16.0), Burley ($21.0) and Flus Cured ($12.0)', due mainly to higher
forecasted sales.
Accounts Payable/Accrued Liabilities were $31.4 higher than last year
mainly due to a higher provision for advertising coupons, ($19-6),
resulting from higher cents/dollars-off coupon activity.
Net Fixed Assets were $37.2 higher, primarily attributable to
spending relative to the replacement, upgrading and addition of
Fabrication and Primary equipment at Macon. Partially offsetting the
C:@
increased spending were disposal& of obsolete equipment and normal
depreciation for assets in service.
B.A.T INmomas P.1-C. - MINNESOTA DEposffoRy COPY - PWOUCSD PURSUANT To I VILD. OF
CONSENT JUDGMENT DATED SISM IN STATE OF AIIAMSOrA. Er AL V. PHXIP Afoggx, Er AL.@ CASE No. C14M.MS
FINJ
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ComENT JuDomENT DATED 518= w SrATE oF Mimwsom Er AL- v. Pmvp Uomm, Er CASE NO. Cl 94 $565
NET ASSETS. SEMMER 1991 VS. QM
(DOUAM IN MMUONS)
840mbw
SNPWMO-
CMMP
1991
1991
(Wpma an
Pwovs
Nd ASSOM
2t!!ft WOMM9 COUL'
A0000M RooWw"
$ 244J
s 244.6
Not bivockwin
369.0
364.9
+ 4.1
Atmob Payel"Accued Ljsb@
(2$9.7)
1
(243.2)
- 15.6
Odw Offrom AusWaJabl")
16.6
11.6
+ 5.0
OPKSdMg Wwkiog Coodl
371.4
377.9
- 6.5
Not Fl=d Aum
40PA
4$4.5
- is.1
N"hoolm"
159.6
159.6
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(21.2)
3.1.
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No menu Aff ft M" "M slu BMW am ftomaiml im ft sspm"w Qu " ad* so
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B.A.T INDUSTRIES P.LC. - MmomumA DEposrroRy Copy - PRWJMD PURSUANT To I VILD. OF
CONSENT JUDOMENT DATED SAM IN STATE OFAIIMWSOTAL ETAL V. PHXPAfORM. ETA CAsENo.Cl4M4=5
SEPTEMBER, 1991
OPPRATING CA FWW
(S MMUONS)
SEPTEMBER, 1991
t-TO-DATE
,4CTUAL
[ BUDGET
DESCRDMON
ACTUAL
BUDGET
1"D
42.6
0- 3&4
T"dies PRO&
431.7
76.4
5.0
SJ
+ 0.2
DW*dAdWA=wd=d-
45.9
03
2.0
47.9
38.2
TOW Opwaft scum"
477.6
76.1
3.0
0.7
7.6
ftud Asuft AddidCM
0.6
10.1
18.1
(3-6
75.0
Im"aw(Dat-ft) in op-des
(613)
0+ 95.8
28.6
W"kins copitil
III
O&w Not Uns (Sour=)
13.5
*+ 17.81
-- 11.6
17.51
6.41
Total Opmdus Us" (S-)
21.2
* + 93.4
+ 1.
30.41
31.61
OpMg% C.& F11. 1
45S.81
0- 10.5
0- 4.7
Duoin mkvavbk WVW ce Cub Flow
Operating Cash Flow for the month was $31.6 higher than Budget due to a
decrease in Operating Working Capital versus a budgeted Increase (SYS 0)
offset by lower Trading Profit (08.4). The Operating Working Capitai variance
was due mainly to a decrease in Dowstic Accounts Receivable versus a budgeted
Increase 30.2). Also impacting Operating Working Capital was a lower thin
budgeted flacrease in Leaf Inventory (S36.1 due to the timing of domestic
five-cured market purchases), and increased Accrued Liabilities ($15.6.
primarily due to the Advertising Coupons Liability, $19.9).
'
I C
Operat as low for the year-to-date was $169.5 lower than Budget due to a
n'
tha
lower an budgeted decrease in Operating Working Capital ($85.8) and lower
Tradi fit (576.4). The Operating Working Capital variance was due ninly
I Pro
to an ncrease versus abudgettil decrease in Not Inventories (S90.6), and a
lower than bulgeted decrease In Domestic Accounts Receivable ($53.2 priurily
as a result 0 the December 31, 1990 receivable being lower than estimated in
the 1991 Budget process). The increase in Not inventories was due mainly to
higher Leaf JSS2.7 due to timing of receipt of offshore and Oriental leal
tobacco and lower usings) and higher Domestic Finished Goods ($35.2 due mainly
to higher overall quantities and higher tax paid quantities). Offsetting the
lower decrease in Operating Working Capital was an increase in Accounts
Fayable/Accrued Liabilities ($20.7).
P4.)
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B-A-T IMUSTRIE111 P.Lr- - MMESOTA DEp09ff0RV Copy PROCRICED PURSUANT To VILD. oF
COWEHr JUDGAWNT DATED 5/8198 IN STATE OF A*AVffS0rA, ET AL V. PHILP MORRIS, Er A" CASE No. C1.944"S
TIM Mort Inumtym INPUT
fxzn UDARM iota
to NZLL:Gxl
mmzm VUR000 AMOVID
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CAFXVAL APPAPFUMOKS RVIONIT
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22.4
9.1
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1.9
(1.0)
9.1
1.4
0
3.4
2.2
FzzLb Wogt Fact
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(.9)
2.3
(2.2)
1
IWAMSION (AVJOSI
10.0
20.9
8.9
an =0 =RPM=
.5
1.4
3.9
L.0
25.0
23.0
L3.4
I" BOX XODOW & Zza"
7.S
(4.0)
12.3
(4.6)
m: s MAXIMS
22.1
33.1
0
PRDDW CAIPACM
a
2.4
0
3.4
ma"CEwrt-fthst zz
16.3
16.9
134
ZVAX= SOX CAVACM
.5
-S)
3.0
1.5
21.7
11.7
8.4
Too nV XIGS SPZIM SOX
NODULtS
2.1
(1.4)
S.0
(3.3)
11.4
34.4
4.1
Va *a, -Icnncnvm
2.1
-4)
6.0
(2.0)
ZIOTAVEKINT - PKW 2
10.8
Z0.8
4.4
PRZKAXT CAIPACM
1XIMCDOWr
1.9
.41
6.$
12.31
16.3
10.2
0.2
COWV3= an a" TO
.5
-9)
.9
.6
r" ac,
1.9
7.9
1.4
pas av nLzu am svvm
.1
.7
3.8
(3-31
3.3
S.3
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0
1.0
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3.9
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1.3
2.3
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-77.0
74.9
16.1
F" ON. L%22=
2.2
-7)
10.1
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2.5
3.3
2.3
MIN wmz=
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(1.1)
2.3
NJ&
HIA
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DOTI= Asoff, ""87=5
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(2-4)
13.9)
(1.7)
DIA
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22.2
9.3
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via
TOTAL TOIAOCO WAM
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BAT INmwRms P.Lc. - MINNSSWA DEFOUTM COPY - PRMCEO PURSUANT To VII.D. OF
CONSENT JUDGMENT DATED SON IN STATE OF Aftagsam Er AL V. PNXV AIMM, ET A CASE NO. CI-944M
FIXED &$SET ZXPZWDZTVRZ REPORT
YEAR-TO-DATZ VARIANCE COMENTARY
(DOLLARS IN MILLIONS)
02NIM OFFICE
(1) Japan viandins Program (Lease) - To allow SM presence in the
vending segment of the Japanese market by leasing 20,000 (Wave 1)
and 10,000 (Wave II) branded vending machines. BAW has placed 9,914
machines in Wave I and 3,529 machines in Wave rl. The favorable
variance of $1.3 (actual spend $7.4) is primarily attributable to a
renegotiation of retailers fees and the placement of only 78% of the
Wave 11 machines anticipated in the budget which will result in a
favorable effect an the Wave I and Wave IX programs ($1.0).
Approximately $.2 of the total variance is the result qf Japanese
Yen exchange rate difference between the budgeted rate and the
actual rate.
PURT OPERATIONS
=8 Force Fleet Pro
(2) 1991 Sa _qran - To provide Field Sales Force
vehicle requirements. The $1-.4-Ta-varablo variance for replacement
vehicles is primarily attributable to spending anticipated to occur
during the third quarter 1991 which will not occur until the fourth
quarter of 1991 due to the timing of deliveries.
(3) Field Sales rare nsion (Autos) - -To purchase 110 sales
vans &a EM
representative nd anager vehicles to meet the requirements
of a planned sales expansion. This program was budgeted and
cancelled in 1990. It was not anticipated in the 1991 budget which
has resulted in an unfavorable variance of $2.2.
01MOSKEYT TION 9 a
(4) Field FaMprand-Hel comiout ids To increasa
productivity, accuracy end Speed 9FRIblooff information to
Management. The favorable varl on - is the result of delays
in developing the software which has caus:d ; delay in the
nationwide roll-out of the project. $pan in is still anticipated
to be complete by year-end 1991.
2116ruzzma PROJBCTS
(5) Igo Box-FOR-UMs & Eight Protos Makers ; The purchase and
installation CZ two (2) Protos/X2 sodulas i ich will be used to
empport the expandinq King Size Box market and eight (8) now Protos;
makers which will replace Xark 9 Kakers and will be linked to
existing Basib 6000 Packers to fully utilize current soft cup
packing capacity. The unfavorable variance of $4.6 is the result of
equipment down payments anticipated for the fourth quarter of 1990
which were actually paid in the first quarter of 1991.
(9) Primary capacity Mancement - Phase 11 - To increase the
capacity at the Macon Primary Department Fy-15 billion units per.
year. Based upon forecasted product six, this should yield a
capacity of 110 billion units per year. The $3.4 favorable variance
is primarily due.to timing.
co
B.A.T INammuEs P.LC. - MMESOTA Davs;TORY COPY - Pn=cED PURSUANT To VILD. OF
CONSENT JUDGMENT DATED SAM iN STATE oFA#mwsorA, ErAL Y. PwipMongs, ErA CAsENo.C14M4M5
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B.A.T INDusmas P.LC. - MoodmoTA 06posiToRy Copy - PRMCED PURMANT To I VILD. oF
ComsENT JuoamEw DATEo 518= im SrArE oF AltAmsom Er AL v. Pmtip Almgm Er CAsE No. C1444US
CAPITAL ZrPUMITURZO PROQRZ88 REPORT
YZAR-TO-DATZ VARIANCE COMMENTARY
(DOLLARS IN MILLIONS),
(CONTINUED)
(7) , Expanded Box Capacitx - The purpose of this project is to
purchase four (4) X-2 packers and one (1) PROWS maker for Macon to
expand capacity for box products to most foreseeable future needs.
The favorable variance of $1.5 is primarily due to a change of
spending plans. The budget anticipated spending to be c=pletod by
the second quarter of 1991 but the current plan is to not complete
the proposal until the fourth quarter of 1991 which will spread
spending over a longer period of time.
(8) Two Nov Hiah speed Box Modules - This provides for the purchase
and installation of two h!gE-s-p-e-*-W-Prctos/X2 Box Modules to support
the expanding Xing Size Box Market. This project was approved and
spending began earlier than was anticipated in the budget causing an
unfavorable variance of $3.3.
(9) FAB "B" Productivisx Imp I Phase I - To reconfigura
nodules an&-r-*Tccate filter rMINakuring in FAD "B", including
the purchase of now case packers and a filter rod distribution
system, which will improve productivity and waste reduction. The
primary reason for the unfavorable variance of $2.0 is that spending
was accelerated to match the overhaul and upgrade program.
(10) Primary Capacity. Egpcoment - To allow production of larger
batches of cut tobacco u=navorable variance of $2.3 is the
result of spending being accelerated to meet a revised target
completion date of January rather than July, 1992.
(11) Convert CPS ShRR To FAB '"C" - Construct Annex - To relocate
the maMna 'nop at the Macon Facility and the EWneorinq group at
CEICO to a now building annex and remodel the vacated machine shop
for Fabrication equipment. FAB "C" and the Annex are both near
completion. The 11.6 favorable variance is due to a delay of work on
the case conveyors due to higher priority projects. This work is
anticipated to be completed during the fourth quarter of 1991.
(12) Tab "A" Filing Rod System - To upgrade the Fabrication "A" and
.Coo i1to __ 31_
f r r production process which will include the rebuilding
and upgrading of existing equipment, the purchase of now equipment,
the relocation and installation of the equipment in an optimum
configuration and the installation of a central rod distribution
system. These enhancements will substantially improve operational
effectiveness, waste containment, product quality and employee
safety. The unfavorable variance of $1.3 is the result of the
completion dots: of the project being moved from July of 1992 to
December of 1991 which has accelerated spending relative to the
budget.
C:)
- 3b
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B.A.T INDUSTRIES KLCL - MINNESOTA DEPOSITORY COPY - PRODUCED PURSUANT To VILD. OF
CONSENT JUDGMENT DATED SON INSTATE OF UNNESOrAig ErAL V. PHILVA10ROM ETA CANNO.Cl-944MOS
4c:)
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BAT Immmais P.Lc. - MmEsoTA DovsffoRy Copy - PRODUCED PUMAW To I VILD. OF
COMEM JUDGWIEW DATED SWWIN STAIE OFAINNESOTA, ETAL V. PHLIPUORM, ETA CAsENo.CI444MG5
CAPZTAL ZXPZNDZTVRZS PROORZIS REPORT
YZAR-TO-DATZ VARIANCE COXKMARY
(DOLLxR8 IN HILLIO)w
(CONTZKUED)
(13) Phase 11 720010000 Proton Speed @Mads (12 Uni,t@L - To
purchase twelve protox speed upgrade kite to increase the production
capability of the Protos makers from 7200 cps to $000 cpa. The
favorable variance of $2.5 is the result of a delay in
implementation of this project.
(14) Fab 2000 - Fabrication "A* - This provides for the
installation of the FAB 2000 system into the Macon Fabrication "A"
area. The favorable variance of $.a is primarily the result of the
completion date of the project being moved from third quarter to
fourth quarter of 1992.
(15) Fab wil" Koftruization - This provides for the purchase and
installation of eight (a) new G.D. X500 complexes to be used with
the eight (9) new Protas 90ts. Also included is the purchase and
installation of three (3) now 10,000 CPM modules and four (4) new
AF3/XDF3,s with NCF tray filters and Filtrosat Plug Shooters. The
unfavorable variance of $1.4 is the result of an increase of the
equipment downpayment to 304 verses 15% anticipated in the budget.
(16) P Threabing subline - This proposal will fund the
conversFookolpas thrashing subline at Wilson. The prototype line
will be used in normal production to &&sees the merits of "soft
threshing", to evaluate state-of-the-art threshing and separating
equipment and to demonstrate the benefits of improved data
acquisition. The $2.1 unfavorable variance is primarily due to the
anticipated completion date being earlier than anticipated in the
budget.
A= Fill, I PPMCTS
(3.7) Tne $15.5 fivorable variance in due primarily to the
postponement or cancellation of projects budgeted to come forward by
the third quarter of 2992.
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B.A.T lmmmlEs P-LC. MINNEIMA DEPOSITORY COPY - PRODUCED PURSUANT To VII.D. OF
CONSENT JUDOWNT DATED 5/8M IN STATE OF A#NKSOTA, ET AL V--PHXIP NORM ETA6 CASE No. C1444US
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ILA.T INMWMIES P.LC. - MW#EWrA DEPOWM COPY - PRODUcEo PuRwANr To I VILD. oF
ComsEw JuoowNT DATEo SON iN SrATE oF AtmwsoTA, Er AL v. Pmxtp Monim, ET CAsE No. C14M-SM
1991
Fixed Asset Exp
enditures
Accumulated SPOM
dIMG
145
145 -
130
130
115
115
.0"
100
100
1
00'
85
85
low
70
70
55
55
40
40
25
25
Actual
10
10
I at 2nd 3rd
4th
1991 Five Yeor Ccipital-Plon
210
210.
180
180.
.
150
150
120.
1
20
Actual
.
90
Go.
so
so.
45
C=)
45
-
187 188'89 '90'91 092 193 $94 695
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B.A.T INDUSTRES P.L& - MW4EsOTA DEpogffoRy Copy - POMCED PURMANT To I VILD. oF
ComENT JuDomm DATEo MW oN SrATE oF Wawsom rr AL V. PHLIP UORRN, ET A CAsE No. Cl-94-8595
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CONSENT JUDOWNT DATED $/MIN SwEwAftmwsorg, ETAL. v. PmtpAfoRms, ETA CASENO.Cl-94-MS
48.
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BAT IMUSMIES P.LC. MMESOTA DEPOSffORY COPY PROWCED PURSUANT TO VILD. OF
Comm JuDamENT DATED SAM IN.STATE OF MNWSOTA, Er AL V. PHLip bWgM ET CAsE No. CI-944MSGS
BROWN & WILLIAMSON TOBACCO
TRADING PROFIT
goo
900
'froding Pm11t
CU 11116ne)
leal 269.41
800
1982 $66.4
0
1943 404.1
1984 427.8
1945 443.7
lose $30.6
1987 013.4
700
less MA
lose 761.7
700
90 766.0
1
M
I $1 007.7
:
i
m
800
L----------------------
600
f
500
500
'S
400
400
300
300
200
200
1681 1982 1983 1984 1996 1980 1997 1908 1999 1990 19110
.7191 E*L
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B.A.T Imusmin P.Lc, MMESOTA DVVS1TOW COPY - PRODUCED PURMANT To VII.D. OF
CONSENT JuDemmT DATEo 5am iN srATE OFA*NNESOTA, ETAL V. PFKPAfORRM ETA CASENO.C1-944M5
SALF5 REVENU
E
INTERNATIONAL
DOMESTIC
OPERATIONS
(DOLLARS IN MILLIONS)
1981
1.677
204
110
11991
1082
.1,778
211
168
2,147
Im
1,8114
lB2
96
2,162
lop
1,983
10B
103
2,266
1985
21089
136
el
2,306
1986
2,103
151
98
2,351
1987
2,104
363
80
2,547
1908
2,256
478
87
ZIB21
1989
2,393
$73
114
3,080
I"o
2,250
659
144
3,054
1991*
2,685
757
123
3,565
BROWN & WILLIAMSON TOBACCO
SALES REVENUE
Iasi 1991
40001 14000
38OOF lbasoo
BIT
T
0
L
3200- -3200
2800- -2800
Intl
D
2400 2400
a
D@6"c 1 0
2000dr' 12000
1600-- 1800
leal 0:82 Itgn 684 IOU 1917 10116 089 090 1991
7/61 lot
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B.A.T INDUSTRIES P.LC. WINKESOTA DEFlOSlTORY COPY - PRODUCED PURSUANT TO I -VILD. OF
CONSENT JUDGMENT DATED SAM IN STATE OF 116ANKSOTA, Er AL Y. PNEF AfORM, ET CASE No. Cl-"4M
SIGNIFICANT ITEMS A
S PERCENT OF SALES
DOMESTIC
DOMESTIC
VARIABLE
MARGIN
PROFIT
CONTRIBUTION
TRADING
PROFT
1981
46.5
22.0
13.7
1082
26.6
17.0
1983
46.1
26.6
18.8
1984
$0.7
31.0
19.8
1995
52.4
30.5
19.2
1986
$2.1
33.4
22.8
1987
55.3
35.2
24.1
1988
58.8
34.4
23.1
1989
61.2
34.4
24.4
1990
61.8
3S.3
24.7
1991*
61.2
32.1
22.7
of
40 40
DOM16TIC PROFFT CONTOUBUTIC14
ITO so 0 1;
2c
Ic
0
1941 1082 013 094 1985 1930 1987 1&&$ 1989 1990 1091-
.9- T/91 let. C:)
C=
C;
co
cc
13.A.T ImousTmEsP.Lr- - 11004NESOTA DeVsffM Copy - PRODUCED PWMANT TO I VILID. OF
COMENT JUDGMENT I)ATED 51W" IN SrATE OFUAWSOTA6 ETAL V. PHXV AFORRO, ETA CASENO.Cl-94-M5
BROWN & WILLIAMSON TOBAO00
SIGNIFIOANT ITEMS AS A PEROENT OF SALES
loll - loll
BRO
WN It
WILLIAMS
ON T
OBACC
OPERA
TING CAS
H FL
OW
(MILLION
S)
9HANGE IN
NET A
SSUS
TRADING
PROFIT
CAP17AL
ADDITIONS
OTHER
USE (SOURCE)
OPERATING
CASH FLOW
1991
259.0
102.8
(20.7)
177.7
1982
365.4
123.8
(144.7)
386.3
1283
405.1
45.2
(120 9)
490.8
1984
427.8
43.6
(111:7)
495.8
1985
443.7
51.6
(83 7)
475.8
1986
536.S
52.1
69:4
415.0
1987
613.4
54.7
19.0
$39.7
1988
650. 6
$3.7
(103.5)
700.5
1989
761.7
62.4
2.5
686.8
1990
755.6
75.3
29.0
709.3
1991*
$07.7
111.9
(46.9)
742.6
Note: Converting to "installment sales* is
estimated to have negatively
impacted Operating
Cash Flow in 1986
- $90 and 1987
- $40. The
impact
on 1980 and
1989 is not considered to be material and
Oinstallment sales' were discontinued in 1989.
Tradina Profit less cha
nces In Net Asset
s equals Operati
ng Cash Flow,
BROWN
& WILLIAMSON
TOBACCO
OPERATING CASH FLOW
1981 - 1991
1000
1000
goo
- -
000
U
Soo
-
@
7
goo
700
- -
700
Soo
.
.
@
600
Trading Proll
600
.
600
Cash Flow
400
-
400
a
r
300
- -
300
r
2ok
200
10
100
10
811982 1983 1984 1985 1988 1087 1083 1989 1990 1991
-3a- 7
/91 Bet
C:)
Co
CO
%0
B.A.T Wmwmiiis P.LC. - UlNNEsoTA Devsffm Copy - PROWCED PURSuANT To I VILD. OF
CONSENT JUDGMENT DATED ISM= IN ATATE OF 11011MIESOTA, ET AL V. Pf4LV 1160RFA ET CASE No. C1414413115
'
L
W"
"A
M'O" TOBACC
O
E
S
E
TS
O
N EN
(MI
D IN
LLI
G N
T A
S
ONS)
(RONAI
TRADING
PROFIT
YEAR END
NEI ASSET P
RONA
ERCENTA
NET ASSET
GE TURNOVE
1981
259.8
945.9
27.3
2.1
1982
365.4
925.0
39.S
2.3
1983
40S.1
849.3
47.7
2.5
1984
427.8
781.2
54.9
2.9
198S
443.7
749.1
59.2
3.1
1986
536.5
870.6
61.6
2.7
1987
613.4
944.3
65.0
2.7
1988
650.8
894.1
72.8
3.2
1989
751.7
959.4
78.4
3.2
199D
75S.6
1,005.7
75.1
3.1
1991*
907.7
1,070.8
75.4
3.3
Trading Profit divided by Ending Net
Assets
equals BM.
Got 190
so In
70 170
p
F l
It
T :0 160
EN 0 50
40 140
sov 130
20 . 1 '20
lost 1992 1963 1994 1906 1980 1097 1988 VU 1960 19010
-3- 7/91
co
C)
C)
B.A.T INDUSTRIES P.I-C. - MINNIMMA DEPOSTORy Copv - PWWCED PUMANT TO I VILD. OF
CONSENT JUDQk*Wr DATED 54416 IN STATE OF WKS-07A, ET AL V. PwF AkRm& Er CASE No. CI-944M
BROWN & WILLIAMSON TOBACCO
RETURN ON ENDING NET ASSETS
loll 1911
r1lo
C)
B.A.T IWDUSTRIES P.LC. - MW*MWA DEposffm COPY - PAMCEID PURSUANT To I VII.D. OF
CoNsENT JuDGmENT DATiEo 54400 iN.SrArE oF Atmwsom Er AL v. PHxp hkggis. Er CASE NO. CI-944MS
BROWN & WILLIAMIN@ESTI-C
5ALES REVFPWF AN ITS
UNITS
(BILLIONS)
1981
1,677.3
87.3
1982
1,777.7
93.2
1983
1,983.6
68.S
1984
11982.6
68.0
loss
21088.6
70.7
1986
2,102.6
68.0
1987
2,104.3
62.7
1988
2,256.1
61.1
1989
2,392.7
$9.5
1990
2,250.1
53.7
1991*
2,684.6
S6.4
BROWN & WILLIAMSON - DOMESTIC
SALES REVENUE AND UNITS
lost 1991
ILASS)
28001
2400 so u
2000
Isoo so
1200 0*m Nqu ")P 4m D*v X4a livm L4m L%*@ NP, 60
1981 1082 1968 1164 1986 IOU 1981 1948 1939 1990 10919 NJ
-4- - ?'/*I get CD
C)
%c
%0
M)
BAT INOuOTM P.LC. - MMEWTA 00MOny COPY - PRODIXED PUROIJANT To VII.D. OF
CONSENt JUDGMENr DATED 5/$M IN STATE OF A&ANW$OrA. Er AL V. pF&P MORRIS, Er A, it
CASE No. C14"M
IN DOMESTIC SALES As PERCENT OE TQj8L INOUSTRY SALES
ROLL-
CHEWING
CIGARETTES
PIPE TOBACC
YOUR-OWN
TOBACC
me
1981
13.9
10.8
74.4
10.4
7.2
1982
13.4
10.3
68.3
10.7
7.1
1983
11.5
9.7
65.3
11.1
7.4
1984
11.3
9.7
67.3
11.9
7.2
1985
11.9
8.9
62.5
11.2
7.3
1986
11.7
8.6
61.7
12.0
7.2
1287
11.0
6.0
66.7
12.0
7.4
1988
11.0
8.4
66.7
12.8
7.5
1989
11.4
7.8
73.S
13.S
7.5
1990
10.3
9.8
72.4
13.7
7.S
1991*
11.1
9.4
72.4
13.8
7.S
7/91 Est
BROWN & WILLIAMSON - DOMESTIC
SALES AS A PERCENT OF TOTAL INDUSTRY
r Mail Numf Own
r
t
d d
Pipe
pip,
&nit
r
3? r
r%3
"111111 lion lf@i w" lose fear Im o4# low "Ole
L-4
B.A.T INDUSTRIES P.I-C. MINNESOTA DEIVISITOR'll' COPY - PNMCED PURSUANT TO I VILD- OF
CONSENT JUDGMENT DATED SWU IN SrATE OF TAErALv.PHxpUogpwErA CASENO.C144-M"
SALES OF MAJOR DOMESTIC CIGARETTE BRANDS
Billions
RALEIGH
CAPRI
GPCIFALCOM
RICHLAND
BELAIR
BARCLAY
KOOL
VICEROY
1981
10.6
6.8
7.6
52.8
9.4
1982
10.0
6.3
7.3
51.1
8.6
Im
8.0
.3
4.9
5.8
42.7
6.9
1984
7.4
2.2
S
4.6
4.6
42.3
6.4
1985
6.3
7.9
2.7
4.0
3.7
40.6
5.6
IN6
5.3
10.5
3.4
3.4
3.1
37.2
4.9
1987
4.7
1.0
9.8
3.3
3.0
2.2
34.3
4.4
*988
4.0
2.7
8.0
4.6
2.7
1.8
33.6
3.6
.6989
3.4
3.0
6.1
5.1
2.5 (2)
I.S
31.2
6.7 (1)
1990
5.3 (3)
2.S
6.6
3.4
2.8
1.2
2S.7
6.2
1991*
8.7
3.1
8.4
2.5
1.9
1.0
23.3
7.6
(1) VICEROY converted to Value-for-Money I/j/89
(2) Includes BELAIR Low Pric:,beginning 9/89
(3) Includes RALEIGH Extra b Inning 4/90
7/91 Est
RALEIGH
DOCIFALCON
Ay,-
VICEROY 8ANCLAY
.6
VICEROY
CL AY 13-4
A
IA
I
GELAIR
7.6
ROOL
41.2
00
C)
C=)
%D
B.A.T INDumEs P.Lc. MINNESOTA Domofly Copy pmWCED pURSUANT To VILD. OF
CONSENT JUDWANT DATED SAM iN SrArE OFAfINNESOTA, ErAL K PHLPMORRM ETA CASENO.CJ444US
BROWN 1,
WILLIA
MSON 'NTR
NAT'
ONA
L
INTERNATION
AL AS PERC
ENT OF
TOTAL DOM
ESTI
r
INTERNATIONAL
SALES
VALUE (A)
VARIABLE
14ARGIN
PROFIT
CONTRIBUTION
1961
13.3
11.2
9.7
1992
12.7
10.3
8.4
1993
11.7
9.3
5.9
1984
11.1
9.1
5.7
1985
8.2
6.3
5.1
1986
8.8
7.1
4.4
1987
18.4
13.6
9.8
1988
21.2
15.8
11.9
1989
22.9
17.0
16.3
1990
26.5
19.5
19.2
1991*
26.3
19.3
20.7
(A) Percentage based on Domestic Sales Value less Excise Tax.
BROWN & WILLIAMSON - INrL.
SIGNIFICANT ITEMS AS A PERCENT OF TOTAL
DOMESTIC AND INTERNATIONAL
go
28
25
- eel" vdve
25
22
-
22
r
Variable M
p
T
13
3
__
trib
flt c
tion]
:
13 T
0
on
u
:@
E
1981 "82 1083 1084 1988 1986 1987 1988 1989 1990 1091 C>
9 7/91 Est.
.8A- co
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B.A.T INIMMIES P.LC. - MONESOTA DEP09ffM COPY - PRMCED PuRsuAmr To I VILD. oF
CoNsEwJuDatAENTDATEi)&WntNSrATEoFuNNEsoTA,ETALV.PMLPAkRAMErA CANNO.Cl-944015
BROWN & WILLIAMSON INTERNATM
SIGNIFICANT ITEMS AS A PERCENT OF SALES
MEMO UNITS (MILLIONS) PENENTAGE
EXPORTS. CONTRACTS INTERNATIONAL PROFIT
IMPORTS LICENSEE VARIABLE CONTRIBUTION
HARSIN REPORTING
1981
16.7 15.1
44.3
18.6
1982
15.S 12.6
47.9
19.4
1993
12.0 15.2
49.3
20.6
19B4
11.0 17.5
$1.6
16.7
198S
8.8 19.9
56.2
20.6
1986
9.7 18.9
$4.1
25.0
1987
23.7 19.6
5S.5
21.5
1988
29.6 21.5
$2.0
21.9
1989
33.5 25.8
52.3
27.9
1990
39.0 31.8
52.2
28.6
1991*
42.1 35.4
51.8
29.6
BROWN & WILLIAMSON - INTERNATIONAL
Significant Items as a Percent of Intl Sales
so
so
as
-
-
55
Varki I in
6
0
-
60
45
.
46
40
-
.
40
It
0
C
E
35
-
.
35 IN
30
Mo
25
Profit Contribution
26
2
20
s
I
a
I
10
21 1982 1983 1984 095 19" 1997
1988 089 111190 IM
.6.
7/01 Fat
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C)
INC
cr%
B.A.T Imurmas P.Lc. - MumaTA DenwroFty COPY - PROOI)CED PuRsuANT To VILD. OF
CONSENT JUDGMEW DATED 518/9111 IN Sun OF Wwsm, Er AL V. PHALP UORRAL Er A" CASE NO. C14"111115
C:)
co
%D
%D
114
BAT IwDtwniEs P.LC. - MINNESOTA DEposffm Copy - Pm=CED PURWAKr To I -VILD. OF
COMENT JUDGMENT DATED SWW IN SrATE OF AIINWSOTA, ET AL V. PHLAP AlORM, ET CASE No. C14441565
SUPPLEMENIAL
201800998
ci
0
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CD
c=)
%0
%D
%0
BAT INKtMKS P.LC. - MrawmA DEpowroRy Copy - PwvjmiD PuRstiANT To I VII.D. oF
CoNsENTJuDowmTDATEt)StiMiN.SrATEoFA*Amso,rA.ETALV.PNXPAkRRAErA CAsENo.Cl-944M5
BATUS HOLOINGS
CONSOLIDATED STATFMFNT OF NET INQOME
BE MEER I"I
(DOLLARS IN MILLIONS)
MONTH
Y
EAR-TID-DATE
FAVJ(UNF.) VERSUS
FAVJ(UNF.) VERSUS
ACTUAL
BUDGET LAST YEAR
DESCRIPTION
ACTUAL
BUDGET LAST YEAR
SAI F
303.7
(4.4)
-1.4%
22.9
8.1
TOBACCO
% CHANGE
Z306.111
(173
211412
12.9W
-1
RETAIL
V x?-6)
NIM
%6 CHANGE
NIM 1
303.7
J4.4)
22.8j
TOTAL SALES
2.306.8
(173 -1)
(943.4)1
-1.4%.
8.1
.1
% CHANGE
-29.0%1
1
TRADING PROFIT
I
42.6
4
(a
(66.3)
TOBACCO
431.7
(711.4)
1
MAI
-
RETAIL
(14.51!
M.4)
0.1
1.01
CORPORATE
(3-7)l
1.11
ICA i
42.21
($L$)
(57.3)l
TOTAL TRADING PROFIT 1
4=-o 1
MAI
1
(9-1)l
m
M-1)
02
OTHER WCOME11EXPENSE)
(3A)
0.1
-SLS
4.3
(9.9)
NET INTEREST EXPENSE
316.1
2L6
&6
(34.1)
WQ)
PRETAX INCOME
IOLS
OLS)
(27.0)1
1.6
16.1
31.0
INCOMETAXES
43.7
93.5
13-31
64
0111,1)
(36.0)
NErINCOME-OPERATIONS
".8
mo-m
3
-
DEFONSEE"ENSWEl'OFTM
2.2
-1
DIVIDEND INCOME API
421
(18.111
05.0)1
TOTAL NET INCOME
xl;t
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B.A.T INDUSTRIES P.LM MINNESOTA DEPOSITORY COPY - PwwcEo PuRwANT To VILD. OF
CONSENT JUDGMENT DATED 518WI IN STATE OF UNNESOTA, ET AL V. PHILP MORRO, Er A" CASE No. C1444=5
RATUS HaLnINGS C OMM ENTARY
SEPTEMBER, W1
(S IN MILLIONS)
Not income for the month and year-to-date was unfavorable due to
unfavorable tobacco trading profit, partially offset by favorable net
interest expense and income taxes.
Tobacco revenue and trading profit were unfavorable $173.1 and S76.4'
respectively, for the year-to-date due mainly to unfavorable Domestic
(-2.0 billion) and International (-4.3 billion) cigarette sales.
Not interest expenses was favorable for September ($4.3) and year-to-date
(S22.6) due mainly to lower than budgeted borrowing rates on commercial
paper.
Income taxes were $23.5 favorable year-to-date due to unfavorable pretax
income.
Co
C)
C)
B.A.T Imoumas P.Lc. - MmEwTA DEPosrrony Copy - PROOUCED PURSUAmT To VILD. oF
CoNww JuoowNT DATEo 5/8W iN STArE or A#NNEsoTA, Er AL v. Pyxip Mongs, jr CASE No. CI-944US
r%)
C$
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CD
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B.A.T lwmmss P.LC. - MWMWTA DONOWORY COPY - PWWCED PURSUAW TO I VILD- OF
coNuw iuoGww DATEo sisM iN STATE oF MMmsorA. ET AL v. PmLv AlbRom ET AL CASE NO. Cl 94 5
B&US HOLDINGS
SUMMARY OF OTHER INCOMFIEXPENSF A NET INTERE
SEPTEMBER 1"I
(DOLLARS IN MILLIONS)
MONTH
YEAR-TO-DATE
ACTUAL
FAVJ(UNF.) VERSUS
BUDGET LAST YEAR
ACTUAL
FAVJ(UNlF.) VERSUS
BWGET LAST YEAR
OTHER INCOME4EXPENSE)
INCOME FROM REAL ESTATE
VENTURES
(0-1)1
(0-11
(0-1)
PURCHASED TAX BENEFITS
(2.1)
0.5
0.1
0.1
LEVERAGED LEASES
(0.3)
(0-3)
0.0
0.1
NON-WCOME TAXES
(0-8)
0.1
(010)
M-0)
0.11
FOREIGN VISITORS
0.1
-
MISCELLANEOUS
0.1
to-I)i
0.21
TOTAL OTHER INCJ(EXP.)
0.8
INTEREST ANALYSIS
4.2
(10-0)
INTEREST EXPENSE
317.7
2L4
(12.0)
0.2
0.1
-
INTEREST INCOME
1.5
0.2
(6-7)
33.31
431
(9-9)
NET INTEREST EXPENSE
31&1
=61
(ILM
cc
c:)
c:)
c:)
LA.T INIXISTRIES P-I-C. - MmESoTA DEPOSITORY COPY PRODUCED MMAtir TO V11-0- OF
CoNsE?fr JuDoWNT DATED 5/819111 IN STATE OF MMM907A, IT AL K PHILIP AWRIS IT CAsE No. Cl-94-M5
NJ
C=)
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BAT INDtWMES P.LC. - Mwasou DovsffoRy Copy - PRODUCED PURMANT To I VII.D. OF
CoNsENrJuDoAmEurOATEn.WS198tmSrArEoFANNNESOTA.ETALV.PHXIPMORRMITA CASENO.Cl-94-MS
A4 S AM Dr*7DM
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B.A.T Mumma P.Lc. - MmEsaTA DposffoRy COPY - Pm=cED PURNAW To VII.D. OF
Comm JuDowNr DATEo SAM w SrArE oF Atowsom ET AL v. PNwP AkRm, Er CASE NO. C14M415"
DEFINITION OF ACCOUNTING TERKS
SECTION I
GROSS PAIQ SALFS - DOME TIC, on pages I & 2, consists of the Domestic sales
value, les
s the cas
h d
iscount for prompt payment.
QMESTIC SALES QUANTITILS. S, includes the free component of the
"
d:d 'M:k'
m b
'b
f
an
ree
s.
uy one got one
V
ARIABLE MARGIN, show on page 2, is the amount that remains from sales value
a
fter deducting the costs which vary directly with each unit of sale including
Variable Manufacturing Costs, LIFO-Leaf (adjusts leaf to current cost),
Federal
Excise Tax, Coupon Plan, Freight Costs, Stamping Allowance, GPC Royalty and
GENERIC Rebates.
SPECIFIC BRAND EXPENSES, on pages 2 & 6, includes the accounts Advertising
Media, Sales Promotion - Specific, Coupon Promotion, and Loss an Returns.
B
RAND CONT f&lrrfd%uIon pages I & 7, shows the amount that remains from
f
E
V
ic Brand
xpenses.
ariable Margin after deducting Speci
DON-SPECIF
IC MARKETING EXPENSES, on pages 2 & 6. includes the accounts Sales
Promotion
- Non-Specific and Selling Field, which are not Identifiable by
brand.
gNFRAL &
AM
INISTRATIV bruere on page 2. Includes the "Met" G&A Expanses
for the 0
m st
ic busine he transfer of amounts to the other cost
centers.
DOMESTIC P
ROFIT
11111TION, on pages I & 2, shows the amount of profit
applicable
to t
he Domestic business before application of costs common to both
the Domestic & International businesses.
INTFRUATIO
NAL PROFI
T COMTRIWION, on page I A 9, shows the amount of profit
applicable
to the I
nternational Business before application of costs common to
both the Domestic and International businesses.
Com OPERATING CO
STS -
PMFACTURIW.'L, on pages 2 & 12, includes the accounts
Manufactur
ing Ovorh
eads,
Cost Variances, Depreciation, Rents, Etc.. and
Inventory
Adjustments and are common to both the Domestic & International
businesses.
MW LIFO - OTHER, on pages I & 2, represents LIFO other then Leaf Replacement
cost.
TR
ADINC IR
OFIT, on pages I & 2, represents the contribution from operations
Pi
fo
r BWT an
d EIT before federal and state income taxes and investment income
and expense.
Co
CD
B.A.T INMWMES P.LC. - MNMESOTA DEPOSffoRy Copy - PRMCED PURSUANT To I VILD. oF
COWNrJUDGMENrIDATEDSIS/9$im$rArEoFA#AmsorA,ErALV.FWILP"M&ErA CASE 140.Cl-94-MS
DEFINITION OF ACCOUNTING TERMS (CORT'D.)
SPECIFIC MARKETING EXPENSE, shown on page 6, includes the accounts Advertising
Media, Sales Promotion - Specific, and RALEIGH/BELAIR Premium Program.
LOSS ON RETURNS EXPENDITURES, on page 6, are composed of the list price plus a
6.5% distributors handling allowance (5.65 Full Revenue and RICHLANJD 25,s; $.SO
Low Price Branded; S.30 Extra Low Price), less excise taxes refunded plus the
expense of the Returned Goods Operation, (priurily labor) and incoming freight.
DMESTIC GENERAL A ADMINISTRATIVE EXPENSES, on page 8, includes the NET G&A
Expenses for the Domestic business, after the transfer of amounts to the other
cost centers.
SALARtF@ & EMPLOYEE WELFARE EXPENSES. on pill 8, includes expenses for Salaries
(I ncluding Overtime and Gratuities) and Emp oy*es' Welfare. Employees'
Welfare expenses Include the Company's portion of expenditures for F.I.C.A.,
Workman's Compensation Insurance, Unemployment Insurance, Group Insurance,
Hospitalization Insurance, and Pension.
OTHER EMPLOYEE RELATED EXPENSES, on page 6, includes expenses for Employee
Relations, Entertaining, Travel, Telephone & Telex, Memberships (Individual),
Subscriptions, Automobiles and Office Supplies.
GENERAL OVERHEAD, on page 8, includes expenses for Taxes (after transfers),
Insurance (after transfers), Depreciation & Rents, Maintenance, Utilities &
Upkeep, and Security Services (after transfers).
COMMUNITY AND INDUSTRY RELATIONS on page 8, includes expenses for
Contributions, Publicity Media, and Corporate Memberships.
MffSIDF SFRVICES, on page B, includes expenses for Professional Fees L Services
(after transfers), part-time temporary help, and Service Charges.
MISCELLANEOUS OPERATING E,' PENSES, on pale 8, includes expenses for Commissions
Allowances, Incidentals, Postage Used, actory Labor, Bad Debts, and Product &
Process Development.
TRANSFER CHARGES, on page 8. represents the amount transferred to other cost
centers (including transfers for Taxes, Insurance, S curity Services, Actron
Defense Overseas related expenses, and Corporate Leg:l expenses).
PRODUCTIVITY, on page 12, represents the number of cigarettes produced by Macon
per hour worked for hourly employees. Both direct and overhead hours are
included in the calculation. Hours worked in Primary for tobacco shipped to
other locations, Returned Goods, and Quality are excluded.
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B.A.T INDumiEs P.LC. - MMUCTA ORPOWORY Copy - Pn=cEo PURWAPIT To I VILD. oF
CONSENTJUVOIAENT DATED 5AM iN 6rArroFA#m&sorA, ErAL. V. PWIPA0MM, ETA CASEM.Cl-94-MG
DEFINITION OF ACCOUNTING TERMS (CONT'D.)
SECTION 11
CUR@FNT ASSETS, on page 1. are those assets excluding non-operating cash which
will be consumed in the business within the operating cycle, normally one year.
This includes Not Inventories which are valued at cost under the 'Natural
Business Unit' (Single Pool) method.
CURRENT LIABILITIES, on page 1, are those liabilities which will be discharged
with cu"ent assets in the normal operating cycle of the company; general y one
year from the balance sheet date
,, torithis presentation the current
liabilities representing intere ar ng, income tax obligations, and deposits
hold for affiliates are excluded.
OPERATING WORKING CAPITAL, on page 1, are Current Assets less Current
Liabilities of a non-incomp tax and non-interest bearing nature.
NET FIXED ASSETS, on page 1, are the historical investment In land, plant and
equipment less accumulated depreciation.
INTANGIBLES, on page 1, includes the unamortized portion of the Trademark
Purchase and the Richmond Branch Business.
NET ASSETS, on page 1, are Operating Working Capital plus Net Fixed Assets,
Intangible Assets, and other Assets less Non-Current Liabilities as defined.
TRADING PROFIT - IQBACCO, on page Is, represents the contribution from
operations for,BWT and ELT before federal and state income taxes, and
investment income and expense.
TRADING tRQFIT - CORPORATE, on page Is, represents the expenses associated with
certain functions previously performed by BATUS. These functions Include cash
management (investments and borrowings) and portions of corporate tax and law
(excluding functions handled by BWT).
0THrR INCOME I (EXPENSE), on page I&, includes income from real estate joint
ventures and expenses associated with purchased tax benefits, leveraged leases
and non-income taxes.
NET INTEREST EXPENSE, on page It, includes the interest expense incurred from
commercial paper and from long-term debt with affiliated companies, netted with
income generated from investments.
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B.A.T INDUSTRIES P.LC. - MR01680TA, DEPOSITOW COPV - PRODUCED PURSUANT To I VILtL OF
CONSENT JUDGMENT DATED 5/8M IN SrATE OF A*NWSOTA, ErAL V. PWV UORRM ETA CASE NIO. CI-944MS
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BAT INDusTRms P.Lc. - MmAnwA Domwom Copy - PmmcEo PuRwAwr To I VILD. oF
CoNsENT JuoamEw DATED SON iN Sun oFMMmsoTA, ErAL v. PFKipMaRgm ETA CAsENo.Cl4M4M
B.A.T INDWRIES P.LC, - MUMBOTA DEPOSITORY COPY - PWWCED PURMANt To I VILD. OF
Comm JuomamT DATED SON IN STATE oFA*AMSOTA, ETAL V. PNLIPUDRRML ETA CAsENO.Cl-94-MS
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