Under hard competition while only few companies in Russia are manufacturing tobacco articles and the market share of products of the biggest multinational companies exceeds 80%

THE FOLLOWING STRATEGY IS DECIDED BY THE RUSSIAN NATIONAL COMPANY “DONSKOY TABAK”:

to be the biggest Company next to multinational companies;

to ensure mobility in decision making in view of any issues and problems of the Company;

to provide customers with high quality products adhering to price/quality concept and distributing the most requested cigarette brands on the market;

to sustain high technology level, efficiency of business activities  and technical maintenance of the production facilities;

to sustain the market share on Russian market at least at 4% and at least at 20% in South Federal District;

to increase market share by at least 0.5% annually  by strengthening  geographical presence in regions. 7% shall be reached 2008.

to shrink the production of low price cigarettes  step by step taking into consideration market requirements. At the same time, to increase the output of products in medium-high and high price and quality segment. The value of the “medium pack” shall increase by two rubles annually.

to practice more widely execution of orders both from ordering companies and the government;

to expand distribution network in traditional sales areas and in newly claimed areas;

to increase output of products for export

to guarantee fulfillment of obligations to pay taxes to all kinds of budgets and to effect payments to  Federal Off-Budget funds;

to ensure fulfillment of law requirements  concerning ecology and environment safety;

to provide the  personnel of the Company with guaranteed “social support”;

to maintainsafe work conditions.

The Company’s Policy

The highest aim of OAO “Donskoy Tabak” with respect to manufacturing of tobacco products is to maintain the maximum marketability by better satisfying customers and reduction of environmental impact.

The ways to this aim:

-  improvement of  the management system by its further development on all stages of the production cycle from  plain worker to top manager in accordance with requirements of International Standards ISO 9001:2008 and ISO 14001:2004;

-  output of products corresponding to the quality requirements of the National Law;

-  development

 and launch of the most requested product types, representation of the products in all price segments of the market;

-  technological process management with respect to the norms for waste disposal and emissions into atmosphere;

-  planning and realization of measures for equipment update and resource-saving;

-  constant motivation of the personnel in order to meet technological and ecological requirements.

The managers of OAO “Donskoy Tabak” undertake to cover requirements of the enterprise for recourses to realize the Policy and they appeal the whole staff to be a team of like-minded individuals and to penetrate the understanding of their importance and their  responsibility for product quality as well as for reduction of environment pollution.