2011 Annual Report

PMI’s supply chain management serves as a cornerstone of our overall success. The challenge of organizing the enormous quantity of materials and supplies required for our business is significant. For example, in 2011 we shipped approximately 120,000 containers around the world which, if stacked length-wise one on top of the other, would stand higher than the equivalent of 900 Eiffel Towers. We also transported close to 2.5 million standard shipping pallets in 2011. Lined up end-to-end, they would represent a distance equal to the length of Greenland. Perhaps the most notable demonstration of our agile supply chain infrastructure was in support of our production ramp-up for Japan. This involved the accelerated supply of significant quantities of raw materials, the activation of 11 factories, six of which had never manufactured product for Japan, and the air freight of more than 16 billion cigarettes involving 222 charter flights and 848 commercial flights. The entire operation was a key factor to our exiting 2011 with a fourth-quarter share of 28.2%, up nearly four share points compared to a full-year market share of 24.4% in 2010.