The Group has substantial operations in over 180 countries. The Group’s results are influenced by the economic, regulatory and political situations in the countries and regions in which it has operations. Some countries in which the Group operates face the threat of increasing civil unrest and can be subject to frequent changes in regime. In others, terrorism, conflict and the threat of war may have a significant impact on the business environment. Some countries maintain trade barriers or adopt policies that favour domestic producers, preventing or restricting sales by the Group. There can be no assurance that political, social, legal, economic, trade or other developments, as well as theft and fraud, will not have an adverse impact on the Group’s investments and businesses or on the Group’s consolidated results of operations.

Severe disruption to any aspect of the Group’s supply chain or suppliers’ operations could have an adverse impact on the Group’s ability to produce and deliver to customer demands. In certain markets, the distribution of Group products is through channels managed by third parties, and often licensed by governments. In these instances, loss of distribution, and therefore a reduction in sales volumes and revenues, is a possibility.

The raw materials used in the Group’s business are commodities that are subject to price volatility caused by factors such as weather conditions, growing conditions, local planting decisions, market fluctuations and changes in agricultural regulations. Commodity price changes that are beyond the Group’s control may result in unexpected increases in raw materials and packaging costs for the Group’s products.

The Group operates in highly competitive businesses and geographical markets. To maintain a competitive advantage, it must anticipate and respond to new consumer trends through continuous innovation. The Group also seeks to develop and market new products, packaging and technologies, including products with potentially reduced harm. Development of these products is an expensive and lengthy process, but there are anticipated advantages for any manufacturer who introduces these products to the market first. Competitors’ speed-to-market in branding changes, new product launches, or changes in product mix, could have an adverse effect on the Group’s operations.

In tough competitive environments, where the price burden on consumers is high because of taxation or limited purchasing power, the Group is vulnerable to competitors aggressively taking market share through price repositioning, which generally has the impact of reducing the overall profit pool of the market and, ultimately, Group profits.