Altria Group, Inc. (Altria) (NYSE: MO) today reports its 2021 third-quarter and nine-months business results, announces the expansion of its existing share repurchase program and narrows its 2021 full-year adjusted diluted earnings per share (EPS) guidance.
"Altria continued to balance maximizing profitability from our core tobacco businesses with investing to realize our Vision of responsibly leading the transition of adult smokers to a smoke-free future," said Billy Gifford, Altria's Chief Executive Officer. "Our tobacco businesses performed well against difficult year-over-year comparisons and we're encouraged by the significant retail share growth from on! in the third quarter. We also continued to reward shareholders with a strong and growing dividend and announced today the expansion of our existing $2.0 billion share repurchase program to $3.5 billion."
"We are raising the lower-end of our full-year 2021 guidance and now expect to deliver adjusted diluted EPS in a range of $4.58 to $4.62. This range represents a growth rate of 5% to 6% from a $4.36 base in 2020."
Altria Headline Financials1
($ in millions, except per share data) |
Q3 2021 |
Change vs. Q3 2020 |
|
Q3 YTD 2021 |
Change vs. Q3 YTD 2020 |
Net revenues |
$6,786 |
(4.7)% |
|
$19,758 |
(0.5)% |
Revenues net of excise taxes |
$5,531 |
(2.6)% |
|
$16,025 |
1.5% |
|
|||||
Reported tax rate |
17.6% |
100.0+ pp |
|
44.9% |
3.1 pp |
Adjusted tax rate |
24.9% |
(0.9) pp |
|
24.9% |
0.2 pp |
|
|||||
Reported diluted EPS2 |
$(1.48) |
(100)%+ |
|
$0.46 |
(66.2)% |
Adjusted diluted EPS2 |
$1.22 |
2.5% |
|
$3.52 |
4.5% |
1 "Adjusted" financial measures presented in this release exclude the impact of special items. See "Basis of Presentation" for more information.
2 "EPS" represents diluted earnings (losses) per share attributable to Altria.
As previously announced, a conference call with the investment community and news media will be webcast on October 28, 2021 at 9:00 a.m. Eastern Time. Access to the webcast is available at www.altria.com/webcasts.
Cash Returns to Shareholders and Capital Markets Activity
Share Repurchase Program
Dividends
Ste. Michelle Wine Estates Transaction
On October 1, 2021, UST LLC completed the sale of its Ste. Michelle Wine Estates business and received net cash proceeds of approximately $1.2 billion, which Altria used to partially fund its expanded share repurchase program. In the third quarter, Altria recorded a pre-tax charge of $51 million related to the disposition.
Smoke-free Products Business Platform
Heated Tobacco
Oral Tobacco
ABI Investment
Impact of COVID-19 Pandemic and Pre-Tax Impairment Charge
Strategic Review of ABI Investment
The five-year transfer restriction of the 185 million ABI shares that Altria received in the 2016 ABI and SABMiller plc business combination expired on October 10, 2021.
Altria views its ABI stake as a financial investment and is focused on maximizing the long-term shareholder value of the investment. In anticipation of the expiration of the lock-up, Altria conducted an in-depth analysis of its investment in ABI considering a range of factors, including: (i) the strategic rationale for continuing as a long-term investor in the beer category; (ii) ABI's share price (which has declined by more than 30% since October 2019 due in large part to the effects of the COVID-19 pandemic on its business); (iii) expectations for ABI's business; (iv) alternative uses of capital; and (v) tax considerations.
Altria determined that selling its investment in ABI at this time would not maximize long-term shareholder value; therefore, Altria currently plans to maintain its ABI investment. Altria continues to have confidence in ABI's (i) long-term strategies; (ii) premium global brands; (iii) experienced management team; and (iv) capability to successfully navigate near-term challenges.
Altria will continue to monitor and evaluate market conditions and the analytical factors described above on a regular basis, in accordance with its goal of maximizing the long-term shareholder value of this investment.
Environmental, Social and Governance (ESG)
Altria's Corporate Responsibility Focus Areas are (i) reducing the harm of tobacco products, (ii) preventing underage use, (iii) protecting the environment, (iv) driving responsibility through our value chain, (v) supporting our people and communities and (vi) engaging and leading responsibly. Altria's corporate responsibility reports can be found on the Corporate Responsibility Reports page at www.altria.com/responsibility.
Impact of COVID-19 Pandemic
Impact on Tobacco Business Operations
Impact on JUUL and Cronos Investments
2021 Full-Year Guidance
Altria narrows its guidance for 2021 full-year adjusted diluted EPS to be in a range of $4.58 to $4.62, representing a growth rate of 5% to 6% from an adjusted diluted EPS base of $4.36 in 2020. While the 2021 full-year adjusted diluted EPS guidance accounts for a range of scenarios, the external environment remains dynamic. Altria will continue to monitor conditions related to (i) the economy (including unemployment rates and the impact of increased inflation), (ii) ATC dynamics, including stay-at-home practices, disposable income, purchasing patterns and adoption of smoke-free products, (iii) regulatory and legislative (including excise tax) developments and (iv) the timing and extent of COVID-19 vaccine administration and the impact of COVID-19 variants.
Altria's 2021 full-year adjusted diluted EPS guidance range includes planned investments in support of its Vision, such as (i) marketplace investments to expand the availability and awareness of Altria's smoke-free products, (ii) costs associated with building an industry-leading consumer engagement platform that enhances data collection and insights in support of ATC transition to smoke-free products and (iii) increased smoke-free product research and development expense. The full-year adjusted diluted EPS guidance range excludes the special items for the first nine months of 2021 shown in Table 1.
Altria continues to expect its 2021 full-year adjusted effective tax rate will be in a range of 24.5% to 25.5%.
Altria expects its 2021 capital expenditures to be between $150 million and $200 million, a change from its previous expectation of $200 million to $250 million.
Altria's full-year adjusted diluted EPS guidance and full-year forecast for its adjusted effective tax rate exclude the impact of certain income and expense items that management believes are not part of underlying operations. These items may include, for example, loss on early extinguishment of debt, restructuring charges, asset impairment charges, acquisition-related and disposition-related costs, COVID-19 special items, equity investment-related special items (including any changes in fair value of the equity investment and any related warrants and preemptive rights), certain tax items, charges associated with tobacco and health and certain other litigation items, and resolutions of certain non-participating manufacturer (NPM) adjustment disputes under the 1998 Master Settlement Agreement (such dispute resolutions are referred to as NPM Adjustment Items).
Altria's management cannot estimate on a forward-looking basis the impact of certain income and expense items, including those items noted in the preceding paragraph, on its reported diluted EPS or its reported effective tax rate because these items, which could be significant, may be unusual or infrequent, are difficult to predict and may be highly variable. As a result, Altria does not provide a corresponding U.S. generally accepted accounting principles (GAAP) measure for, or reconciliation to, its adjusted diluted EPS guidance or its adjusted effective tax rate forecast.
ALTRIA GROUP, INC.
See "Basis of Presentation" below for an explanation of financial measures and reporting segments discussed in this release.
Financial Performance
Third Quarter
First Nine Months
Table 1 - Altria's Adjusted Results |
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Third Quarter |
|
Nine Months Ended September 30, |
||||||||||||||
|
2021 |
2020 |
Change |
|
2021 |
2020 |
Change |
||||||||||
Reported diluted EPS |
$ |
(1.48) |
|
$ |
(0.51) |
|
(100)%+ |
|
$ |
0.46 |
|
$ |
1.36 |
|
(66.2) % |
||
NPM Adjustment Items |
(0.02) |
|
? |
|
|
|
(0.03) |
|
? |
|
|
||||||
Implementation, acquisition and disposition- related costs |
0.03 |
|
? |
|
|
|
0.05 |
|
0.17 |
|
|
||||||
Tobacco and health and certain other litigation items |
0.04 |
|
0.01 |
|
|
|
0.06 |
|
0.03 |
|
|
||||||
Impairment of JUUL equity securities |
? |
|
1.40 |
|
|
|
? |
|
1.40 |
|
|
||||||
JUUL changes in fair value |
(0.05) |
|
? |
|
|
|
? |
|
? |
|
|
||||||
ABI-related special items |
2.65 |
|
0.22 |
|
|
|
2.60 |
|
0.29 |
|
|
||||||
Cronos-related special items |
0.05 |
|
0.08 |
|
|
|
0.11 |
|
0.08 |
|
|
||||||
Loss on early extinguishment of debt |
? |
|
? |
|
|
|
0.27 |
|
? |
|
|
||||||
COVID-19 special items |
? |
|
? |
|
|
|
? |
|
0.02 |
|
|
||||||
Tax items |
? |
|
(0.01) |
|
|
|
? |
|
0.02 |
|
|
||||||
Adjusted diluted EPS |
$ |
1.22 |
|
$ |
1.19 |
|
2.5 |
% |
|
$ |
3.52 |
|
$ |
3.37 |
|
4.5 |
% |
Note: For details of pre-tax, tax and after-tax amounts, see Schedules 7 and 9.
Special Items
The EPS impact of the following special items is shown in Table 1 and Schedules 6, 7, 8 and 9.
Non-Participating Manufacturer (NPM) Adjustment Items
Implementation, acquisition and disposition-related costs
Tobacco and Health and Certain Other Litigation Items
Impairment of JUUL Equity Securities
JUUL Changes in Fair Value
ABI-Related Special Items
The ABI-related special items above include Altria's respective share of the amounts recorded by ABI and may also include additional adjustments related to (i) conversion from international financial reporting standards to GAAP and (ii) adjustments to Altria's investment required under the equity method of accounting.
Cronos-Related Special Items
In the third quarter and first nine months of 2021, Altria recorded net pre-tax (income) expense consisting of the following:
|
Third Quarter |
|
Nine Months Ended September 30, |
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($ in millions, except per share data) |
2021 |
2020 |
|
2021 |
2020 |
||||||||
|
|
|
|
|
|
||||||||
(Gain) loss on Cronos-related financial instruments 1 |
$ |
135 |
|
$ |
105 |
|
|
$ |
128 |
|
$ |
202 |
|
(Income) losses from equity investments 2 |
(46) |
|
38 |
|
|
72 |
|
(58) |
|
||||
Total Cronos-related special items - (income) expense |
$ |
89 |
|
$ |
143 |
|
|
$ |
200 |
|
$ |
144 |
|
Earnings per share |
$ |
0.05 |
|
$ |
0.08 |
|
|
$ |
0.11 |
|
$ |
0.08 |
|
1 Amounts are related to the non-cash change in the fair value of the warrant and certain anti-dilution protections acquired in the Cronos transaction.
2 Amounts include Altria's share of special items recorded by Cronos and may also include adjustments to Altria's investment required under the equity method of accounting.
Loss on Early Extinguishment of Debt
COVID-19 Special Items
Tax Items
SMOKEABLE PRODUCTS
Revenues and OCI
Third Quarter
First Nine Months
Table 2 - Smokeable Products: Revenues and OCI ($ in millions) |
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|
Third Quarter |
|
Nine Months Ended September 30, |
||||||||||||
|
2021 |
2020 |
Change |
|
2021 |
2020 |
Change |
||||||||
Net revenues |
$ |
5,975 |
|
$ |
6,313 |
|
(5.4)% |
|
$ |
17,275 |
|
$ |
17,522 |
|
(1.4)% |
Excise taxes |
(1,218) |
|
(1,407) |
|
|
|
(3,620) |
|
(3,950) |
|
|
||||
Revenues net of excise taxes |
$ |
4,757 |
|
$ |
4,906 |
|
(3.0)% |
|
$ |
13,655 |
|
$ |
13,572 |
|
0.6% |
|
|
|
|
|
|
|
|
||||||||
Reported OCI |
$ |
2,753 |
|
$ |
2,789 |
|
(1.3)% |
|
$ |
7,901 |
|
$ |
7,609 |
|
3.8% |
NPM Adjustment Items |
(21) |
|
? |
|
|
|
(53) |
|
? |
|
|
||||
Tobacco and health and certain other litigation items |
29 |
|
34 |
|
|
|
72 |
|
73 |
|
|
||||
COVID-19 special items |
? |
|
? |
|
|
|
? |
|
41 |
|
|
||||
Adjusted OCI |
$ |
2,761 |
|
$ |
2,823 |
|
(2.2)% |
|
$ |
7,920 |
|
$ |
7,723 |
|
2.6% |
Adjusted OCI margins 1 |
58.0 |
% |
57.5 |
% |
0.5 pp |
|
58.0 |
% |
56.9 |
% |
1.1 pp |
||||
1 Adjusted OCI margins are calculated as adjusted OCI divided by revenues net of excise taxes.
Shipment Volume
Third Quarter
First Nine Months
Table 3 - Smokeable Products: Shipment Volume (sticks in millions) |
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|
Third Quarter |
|
Nine Months Ended September 30, |
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|
2021 |
2020 |
Change |
|
2021 |
2020 |
Change |
||||||
Cigarettes: |
|
|
|
|
|
|
|
||||||
Marlboro |
21,368 |
|
24,258 |
|
(11.9) |
% |
|
63,122 |
|
67,890 |
|
(7.0) |
% |
Other premium |
1,042 |
|
1,231 |
|
(15.4) |
% |
|
3,180 |
|
3,496 |
|
(9.0) |
% |
Discount |
1,640 |
|
2,130 |
|
(23.0) |
% |
|
5,068 |
|
6,205 |
|
(18.3) |
% |
Total cigarettes |
24,050 |
|
27,619 |
|
(12.9) |
% |
|
71,370 |
|
77,591 |
|
(8.0) |
% |
|
|
|
|
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|
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Cigars: |
|
|
|
|
|
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|
||||||
Black & Mild |
424 |
|
468 |
|
(9.4) |
% |
|
1,356 |
|
1,317 |
|
3.0 |
% |
Other |
1 |
|
3 |
|
(66.7) |
% |
|
5 |
|
8 |
|
(37.5) |
% |
Total cigars |
425 |
|
471 |
|
(9.8) |
% |
|
1,361 |
|
1,325 |
|
2.7 |
% |
|
|
|
|
|
|
|
|
||||||
Total smokeable products |
24,475 |
|
28,090 |
|
(12.9) |
% |
|
72,731 |
|
78,916 |
|
(7.8) |
% |
Note: Cigarettes volume includes units sold as well as promotional units, but excludes units sold for distribution to Puerto Rico, and units sold in U.S. Territories, to overseas military and by Philip Morris Duty Free Inc., none of which, individually or in the aggregate, is material to the smokeable products segment.
Retail Share and Brand Activity
Third Quarter
First Nine Months
Table 4 - Smokeable Products: Cigarettes Retail Share (percent) |
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|
Third Quarter |
|
Nine Months Ended September 30, |
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|
2021 |
2020 |
Percentage
|
|
2021 |
2020 |
Percentage
|
||||
Cigarettes: |
|
|
|
|
|
|
|
||||
Marlboro |
43.2 |
% |
43.2 |
% |
? |
|
43.2 |
% |
42.8 |
% |
0.4 |
Other premium |
2.3 |
|
2.3 |
|
? |
|
2.3 |
|
2.3 |
|
? |
Discount |
3.4 |
|
3.8 |
|
(0.4) |
|
3.5 |
|
4.0 |
|
(0.5) |
Total cigarettes |
48.9 |
% |
49.3 |
% |
(0.4) |
|
49.0 |
% |
49.1 |
% |
(0.1) |
Note: Retail share results for cigarettes are based on data from IRI/MSAi, a tracking service that uses a sample of stores and certain wholesale shipments to project market share and depict share trends. This service tracks sales in the food, drug, mass merchandisers, convenience, military, dollar store and club trade classes. For other trade classes selling cigarettes, retail share is based on shipments from wholesalers to retailers (STARS). This service is not designed to capture sales through other channels, including the internet, direct mail and some illicitly tax-advantaged outlets. It is IRI's standard practice to periodically refresh its services, which could restate retail share results that were previously released in this service.
ORAL TOBACCO PRODUCTS
Revenues and OCI
Third Quarter
First Nine Months
Table 5 - Oral Tobacco Products: Revenues and OCI ($ in millions) |
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|
Third Quarter |
|
Nine Months Ended September 30, |
||||||||||||||
|
2021 |
2020 |
Change |
|
2021 |
2020 |
Change |
||||||||||
Net revenues |
$ |
626 |
|
$ |
640 |
|
(2.2) |
% |
|
$ |
1,945 |
|
$ |
1,901 |
|
2.3 |
% |
Excise taxes |
(32) |
|
(33) |
|
|
|
(98) |
|
(98) |
|
|
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Revenues net of excise taxes |
$ |
594 |
|
$ |
607 |
|
(2.1) |
% |
|
$ |
1,847 |
|
$ |
1,803 |
|
2.4 |
% |
|
|
|
|
|
|
|
|
||||||||||
Reported OCI |
$ |
405 |
|
$ |
436 |
|
(7.1) |
% |
|
$ |
1,269 |
|
$ |
1,297 |
|
(2.2) |
% |
Acquisition-related costs |
? |
|
4 |
|
|
|
37 |
|
6 |
|
|
||||||
COVID-19 special items |
? |
|
? |
|
|
|
? |
|
9 |
|
|
||||||
Adjusted OCI |
$ |
405 |
|
$ |
440 |
|
(8.0) |
% |
|
$ |
1,306 |
|
$ |
1,312 |
|
(0.5) |
% |
Adjusted OCI margins 1 |
68.2 |
% |
72.5 |
% |
(4.3) pp |
|
70.7 |
% |
72.8 |
% |
(2.1) pp |
||||||
1 Adjusted OCI margins are calculated as adjusted OCI divided by revenues net of excise taxes.
Shipment Volume
Third Quarter
First Nine Months
Table 6 - Oral Tobacco Products: Shipment Volume (cans and packs in millions) |
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|
Third Quarter |
|
Nine Months Ended September 30, |
||||||||||
|
2021 |
2020 |
Change |
|
2021 |
2020 |
Change |
||||||
Copenhagen |
121.4 |
|
131.1 |
|
(7.4) |
% |
|
378.4 |
|
395.0 |
|
(4.2) |
% |
Skoal |
47.7 |
|
52.3 |
|
(8.8) |
% |
|
148.2 |
|
157.2 |
|
(5.7) |
% |
Other (includes Red Seal and on!) |
29.7 |
|
23.3 |
|
27.5 |
% |
|
87.7 |
|
65.0 |
|
34.9 |
% |
Total oral tobacco products |
198.8 |
|
206.7 |
|
(3.8) |
% |
|
614.3 |
|
617.2 |
|
(0.5) |
% |
Note: Volume includes cans and packs sold, as well as promotional units, but excludes international volume, which is currently not material to the oral tobacco products segment. New types of oral tobacco products, as well as new packaging configurations of existing oral tobacco products, may or may not be equivalent to existing MST products on a can-for-can basis. To calculate volumes of cans and packs shipped, one pack of snus or one can of oral nicotine pouches, irrespective of the number of pouches in the pack, is assumed to be equivalent to one can of MST.
Retail Share & Brand Activity
Third Quarter
First Nine Months
Table 7 - Oral Tobacco Products: Retail Share (percent) |
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|
Third Quarter |
|
Nine Months Ended September 30, |
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|
2021 |
2020 |
Percentage
|
|
2021 |
2020 |
Percentage
|
||||
Copenhagen |
29.2 |
% |
31.8 |
% |
(2.6) |
|
29.8 |
% |
32.1 |
% |
(2.3) |
Skoal |
12.5 |
|
13.7 |
|
(1.2) |
|
12.7 |
|
14.1 |
|
(1.4) |
Other (includes Red Seal and on!) |
6.1 |
|
4.5 |
|
1.6 |
|
5.4 |
|
3.9 |
|
1.5 |
Total oral tobacco products |
47.8 |
% |
50.0 |
% |
(2.2) |
|
47.9 |
% |
50.1 |
% |
(2.2) |
Note: The oral tobacco products retail share results exclude international volume. Retail share results for oral tobacco products are based on data from IRI InfoScan, a tracking service that uses a sample of stores to project market share and depict share trends. This service tracks sales in the food, drug, mass merchandisers, convenience, military, dollar store and club trade classes on the number of cans and packs sold. Oral tobacco products is defined by IRI as moist smokeless, snus and oral nicotine pouches. New types of oral tobacco products, as well as new packaging configurations of existing oral tobacco products, may or may not be equivalent to existing MST products on a can-for-can basis. For example, one pack of snus or one can of oral nicotine pouches, irrespective of the number of pouches in the pack, is assumed to be equivalent to one can of MST. Because this service represents retail share performance only in key trade channels, it should not be considered a precise measurement of actual retail share. It is IRI's standard practice to periodically refresh its InfoScan services, which could restate retail share results that were previously released in this service.
WINE
Revenues, OCI and Shipment Volume
Third Quarter
First Nine Months
Table 8 - Wine: Revenues and OCI (Loss) ($ in millions) |
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||||||||
|
Third Quarter |
|
Nine Months Ended September 30, |
||||||||||||
|
2021 |
2020 |
Change |
|
2021 |
2020 |
Change |
||||||||
Net revenues |
$ |
177 |
|
$ |
157 |
|
12.7 % |
|
$ |
494 |
|
$ |
434 |
|
13.8 % |
Excise taxes |
(5) |
|
(5) |
|
|
|
(14) |
|
(14) |
|
|
||||
Revenues net of excise taxes |
$ |
172 |
|
$ |
152 |
|
13.2 % |
|
$ |
480 |
|
$ |
420 |
|
14.3 % |
|
|
|
|
|
|
|
|
||||||||
Reported OCI (Loss) |
$ |
(24) |
|
$ |
19 |
|
(100%)+ |
|
$ |
21 |
|
$ |
(347) |
|
100%+ |
Implementation and disposition-related costs |
51 |
|
1 |
|
|
|
52 |
|
395 |
|
|
||||
Adjusted OCI |
$ |
27 |
|
$ |
20 |
|
35.0 % |
|
$ |
73 |
|
$ |
48 |
|
52.1 % |
Adjusted OCI margins 1 |
15.7 |
% |
13.2 |
% |
2.5 pp |
|
15.2 |
% |
11.4 |
% |
3.8 pp |
||||
1 Adjusted OCI margins are calculated as adjusted OCI divided by revenues net of excise taxes.
Altria's Profile
Altria has a leading portfolio of tobacco products for U.S. tobacco consumers age 21+. Altria's Vision by 2030 is to responsibly lead the transition of adult smokers to a smoke-free future (Vision). Altria is Moving Beyond Smokingtm, leading the way in moving adult smokers away from cigarettes by taking action to transition millions to potentially less harmful choices - believing it is a substantial opportunity for adult tobacco consumers, Altria's businesses and society.
Altria's wholly owned subsidiaries include the most profitable tobacco companies in their categories: Philip Morris USA Inc. (PM USA), U.S. Smokeless Tobacco Company LLC (USSTC) and John Middleton Co. (Middleton). Altria's smoke-free portfolio includes Helix Innovations LLC (Helix), the maker of on! oral nicotine pouches, exclusive U.S. commercialization rights to the IQOS Tobacco Heating System® and Marlboro HeatSticks®, and an equity investment in JUUL Labs, Inc. (JUUL).
Altria also owns equity investments in Anheuser-Busch InBev SA/NV (ABI), the world's largest brewer, and Cronos Group Inc. (Cronos), a leading Canadian cannabinoid company.
The brand portfolios of Altria's tobacco operating companies include Marlboro®, Black & Mild®, Copenhagen®, Skoal® and on!®. Trademarks and service marks related to Altria referenced in this release are the property of Altria or its subsidiaries or are used with permission.
Learn more about Altria at www.altria.com and follow us on Twitter, Facebook and LinkedIn.
Basis of Presentation
Altria reports its financial results in accordance with GAAP. Altria's management reviews OCI, which is defined as operating income before general corporate expenses and amortization of intangibles, to evaluate the performance of, and allocate resources to, the segments. Altria's management also reviews certain financial results, including OCI, OCI margins and diluted EPS, on an adjusted basis, which excludes certain income and expense items, including those items noted under "2021 Full-Year Guidance." Altria's management does not view any of these special items to be part of Altria's underlying results as they may be highly variable, may be unusual or infrequent, are difficult to predict and can distort underlying business trends and results. Altria's management also reviews income tax rates on an adjusted basis. Altria's adjusted effective tax rate may exclude certain tax items from its reported effective tax rate. Altria's management believes that adjusted financial measures provide useful additional insight into underlying business trends and results and provide a more meaningful comparison of year-over-year results. Altria's management uses adjusted financial measures for planning, forecasting and evaluating business and financial performance, including allocating resources and evaluating results relative to employee compensation targets. These adjusted financial measures are not consistent with GAAP and may not be calculated the same as similarly titled measures used by other companies. These adjusted financial measures should thus be considered as supplemental in nature and not considered in isolation or as a substitute for the related financial information prepared in accordance with GAAP. Reconciliations of historical adjusted financial measures to corresponding GAAP measures are provided in this release.
Altria uses the equity method of accounting for its investment in ABI and Cronos and reports its share of ABI's and Cronos's results using a one-quarter lag because ABI's and Cronos's results are not available in time to record them in the concurrent period. The one-quarter reporting lag for ABI and Cronos does not affect Altria's cash flows. In the fourth quarter of 2020, Altria elected to account for its investment in JUUL under the fair value option. Prior to this date, Altria accounted for its investment in JUUL as an investment in an equity security.
Altria's reportable segments are smokeable products, including combustible cigarettes and cigars manufactured and sold by PM USA and Middleton; oral tobacco products, including MST and snus products manufactured and sold by USSTC, and oral nicotine pouches sold by Helix; and wine, produced and/or distributed by Ste. Michelle Wine Estates. Results for innovative tobacco products and Philip Morris Capital Corporation (PMCC) are included in "All Other."
Comparisons are to the corresponding prior-year period unless otherwise stated.
Forward-Looking and Cautionary Statements
This release contains projections of future results and other forward-looking statements that involve a number of risks and uncertainties and are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995.
Important factors that may cause actual results and outcomes to differ materially from those contained in the projections and forward-looking statements included in this release are described in Altria's publicly filed reports, including its Annual Report on Form 10-K for the year ended December 31, 2020 and its Quarterly Report on Form 10-Q for the period ended June 30, 2021. These factors include the following:
Altria cautions that the foregoing list of important factors is not complete and does not undertake to update any forward-looking statements that it may make except as required by applicable law. All subsequent written and oral forward-looking statements attributable to Altria or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements referenced above.
Schedule 1 |
|||||||||
ALTRIA GROUP, INC. and Subsidiaries Consolidated Statements of Earnings (Losses) For the Quarters Ended September 30, (dollars in millions, except per share data) (Unaudited) |
|||||||||
|
|
|
|
|
|
||||
|
2021 |
|
2020 |
|
% Change |
||||
|
|
|
|
|
|
||||
Net revenues |
$ |
6,786 |
|
|
$ |
7,123 |
|
|
(4.7)% |
Cost of sales 1 |
1,858 |
|
|
1,961 |
|
|
|
||
Excise taxes on products 1 |
1,255 |
|
|
1,445 |
|
|
|
||
Gross profit |
3,673 |
|
|
3,717 |
|
|
(1.2)% |
||
Marketing, administration and research costs |
569 |
|
|
480 |
|
|
|
||
Operating companies income |
3,104 |
|
|
3,237 |
|
|
(4.1)% |
||
Amortization of intangibles |
18 |
|
|
17 |
|
|
|
||
General corporate expenses |
135 |
|
|
60 |
|
|
|
||
Operating income |
2,951 |
|
|
3,160 |
|
|
(6.6)% |
||
Interest and other debt expense, net |
266 |
|
|
310 |
|
|
|
||
Net periodic benefit income, excluding service cost |
(63) |
|
|
(3) |
|
|
|
||
(Income) losses from equity investments 1 |
5,915 |
|
|
472 |
|
|
|
||
Impairment of JUUL equity securities |
? |
|
|
2,600 |
|
|
|
||
(Gain) loss on Cronos-related financial instruments |
135 |
|
|
105 |
|
|
|
||
Earnings (losses) before income taxes |
(3,302) |
|
|
(324) |
|
|
|
||
Provision (benefit) for income taxes |
(582) |
|
|
632 |
|
|
|
||
Net earnings (losses) |
(2,720) |
|
|
(956) |
|
|
(100)%+ |
||
Net (earnings) losses attributable to noncontrolling interests |
(2) |
|
|
4 |
|
|
|
||
Net earnings (losses) attributable to Altria |
$ |
(2,722) |
|
|
$ |
(952) |
|
|
(100)%+ |
|
|
|
|
|
|
||||
Per share data: |
|
|
|
|
|
||||
Diluted earnings (losses) per share attributable to Altria |
$ |
(1.48) |
|
|
$ |
(0.51) |
|
|
(100)%+ |
|
|
|
|
|
|
||||
Weighted-average diluted shares outstanding |
1,842 |
|
|
1,859 |
|
|
(0.9)% |
||
|
|
|
|
|
|
1 Cost of sales includes charges for resolution expenses related to state settlement agreements and FDA user fees. Supplemental information concerning those items, excise taxes on products sold and (income) losses from equity investments is shown in Schedule 5.
|
|
|
|
|
Schedule 2 |
||||||||||
ALTRIA GROUP, INC. |
|||||||||||||||
and Subsidiaries |
|||||||||||||||
Selected Financial Data |
|||||||||||||||
For the Quarters Ended September 30, |
|||||||||||||||
(dollars in millions) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
|
|
|
|
|
||||||||||
|
Net Revenues |
||||||||||||||
|
Smokeable Products |
Oral
|
Wine |
All Other |
Total |
||||||||||
2021 |
$ |
5,975 |
|
$ |
626 |
|
$ |
177 |
|
$ |
8 |
|
$ |
6,786 |
|
2020 |
6,313 |
|
640 |
|
157 |
|
13 |
|
7,123 |
|
|||||
% Change |
(5.4) |
% |
(2.2) |
% |
12.7 |
% |
(38.5) |
% |
(4.7) |
% |
|||||
|
|
|
|
|
|
||||||||||
Reconciliation: |
|
|
|
|
|
||||||||||
For the quarter ended September 30, 2020 |
$ |
6,313 |
|
$ |
640 |
|
$ |
157 |
|
$ |
13 |
|
$ |
7,123 |
|
Operations |
(338) |
|
(14) |
|
20 |
|
(5) |
|
(337) |
|
|||||
For the quarter ended September 30, 2021 |
$ |
5,975 |
|
$ |
626 |
|
$ |
177 |
|
$ |
8 |
|
$ |
6,786 |
|
|
|
|
|
|
|
||||||||||
|
Operating Companies Income (Loss) |
||||||||||||||
|
Smokeable Products |
Oral
|
Wine |
All Other |
Total |
||||||||||
2021 |
$ |
2,753 |
|
$ |
405 |
|
$ |
(24) |
|
$ |
(30) |
|
$ |
3,104 |
|
2020 |
2,789 |
|
436 |
|
19 |
|
(7) |
|
3,237 |
|
|||||
% Change |
(1.3) |
% |
(7.1) |
% |
(100)%+ |
(100)%+ |
(4.1) |
% |
|||||||
|
|
|
|
|
|
||||||||||
Reconciliation: |
|
|
|
|
|
||||||||||
For the quarter ended September 30, 2020 |
$ |
2,789 |
|
$ |
436 |
|
$ |
19 |
|
$ |
(7) |
|
$ |
3,237 |
|
|
|
|
|
|
|
||||||||||
Implementation and acquisition-related costs - 2020 |
? |
|
4 |
|
1 |
|
? |
|
5 |
|
|||||
Tobacco and health and certain other litigation items - 2020 |
34 |
|
? |
|
? |
|
? |
|
34 |
|
|||||
|
34 |
|
4 |
|
1 |
|
? |
|
39 |
|
|||||
|
|
|
|
|
|
||||||||||
NPM Adjustment Items - 2021 |
21 |
|
? |
|
? |
|
? |
|
21 |
|
|||||
Implementation and disposition-related costs - 2021 |
? |
|
? |
|
(51) |
|
? |
|
(51) |
|
|||||
Tobacco and health and certain other litigation items - 2021 |
(29) |
|
? |
|
? |
|
? |
|
(29) |
|
|||||
|
(8) |
|
? |
|
(51) |
|
? |
|
(59) |
|
|||||
Operations |
(62) |
|
(35) |
|
7 |
|
(23) |
|
(113) |
|
|||||
For the quarter ended September 30, 2021 |
$ |
2,753 |
|
$ |
405 |
|
$ |
(24) |
|
$ |
(30) |
|
$ |
3,104 |
|
|
|
|
|
|
|
|
|
|
|
|
Schedule 3 |
|||||
ALTRIA GROUP, INC. |
||||||||||
and Subsidiaries |
||||||||||
Consolidated Statements of Earnings (Losses) |
||||||||||
For the Nine Months Ended September 30, |
||||||||||
(dollars in millions, except per share data) |
||||||||||
(Unaudited) |
||||||||||
|
|
|
|
|
|
|||||
|
2021 |
|
2020 |
|
% Change |
|||||
|
|
|
|
|
|
|||||
Net revenues |
$ |
19,758 |
|
|
$ |
19,849 |
|
|
(0.5) |
% |
Cost of sales 1 |
5,348 |
|
|
5,909 |
|
|
|
|||
Excise taxes on products 1 |
3,733 |
|
|
4,063 |
|
|
|
|||
Gross profit |
10,677 |
|
|
9,877 |
|
|
8.1 |
% |
||
Marketing, administration and research costs |
1,542 |
|
|
1,381 |
|
|
|
|||
Operating companies income |
9,135 |
|
|
8,496 |
|
|
7.5 |
% |
||
Amortization of intangibles |
53 |
|
|
54 |
|
|
|
|||
General corporate expenses |
255 |
|
|
150 |
|
|
|
|||
Operating income |
8,827 |
|
|
8,292 |
|
|
6.5 |
% |
||
Interest and other debt expense, net |
869 |
|
|
893 |
|
|
|
|||
Loss on early extinguishment of debt |
649 |
|
|
? |
|
|
|
|||
Net periodic benefit income, excluding service cost |
(152) |
|
|
(58) |
|
|
|
|||
(Income) losses from equity investments 1 |
5,789 |
|
|
306 |
|
|
|
|||
Impairment of JUUL equity securities |
? |
|
|
2,600 |
|
|
|
|||
(Gain) loss on Cronos-related financial instruments |
128 |
|
|
202 |
|
|
|
|||
Earnings (losses) before income taxes |
1,544 |
|
|
4,349 |
|
|
(64.5) |
% |
||
Provision (benefit) for income taxes |
693 |
|
|
1,817 |
|
|
|
|||
Net earnings (losses) |
851 |
|
|
2,532 |
|
|
(66.4) |
% |
||
Net (earnings) losses attributable to noncontrolling interests |
? |
|
|
11 |
|
|
|
|||
Net earnings (losses) attributable to Altria |
$ |
851 |
|
|
$ |
2,543 |
|
|
(66.5) |
% |
|
|
|
|
|
|
|||||
Per share data2: |
|
|
|
|
|
|||||
Diluted earnings (losses) per share attributable to Altria |
$ |
0.46 |
|
|
$ |
1.36 |
|
|
(66.2) |
% |
|
|
|
|
|
|
|||||
Weighted-average diluted shares outstanding |
1,849 |
|
|
1,859 |
|
|
(0.5) |
% |
||
|
|
|
|
|
|
1 Cost of sales includes charges for resolution expenses related to state settlement agreements and FDA user fees. Supplemental information concerning those items, excise taxes on products sold and income (losses) from equity investments is shown in Schedule 5.
2 Diluted earnings (losses) per share attributable to Altria are computed independently for each period. Accordingly, the sum of the quarterly earnings (losses) per share amounts may not agree to the year-to-date amounts.
|
|
|
|
|
Schedule 4 |
||||||||||
ALTRIA GROUP, INC. |
|||||||||||||||
and Subsidiaries |
|||||||||||||||
Selected Financial Data |
|||||||||||||||
For the Nine Months Ended September 30, |
|||||||||||||||
(dollars in millions) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
|
|
|
|
|
||||||||||
|
Net Revenues |
||||||||||||||
|
Smokeable Products |
Oral
|
Wine |
All Other |
Total |
||||||||||
2021 |
$ |
17,275 |
|
$ |
1,945 |
|
$ |
494 |
|
$ |
44 |
|
$ |
19,758 |
|
2020 |
17,522 |
|
1,901 |
|
434 |
|
(8) |
|
19,849 |
|
|||||
% Change |
(1.4) |
% |
2.3 |
% |
13.8 |
% |
100.0%+ |
(0.5) |
% |
||||||
|
|
|
|
|
|
||||||||||
Reconciliation: |
|
|
|
|
|
||||||||||
For the nine months ended September 30, 2020 |
$ |
17,522 |
|
$ |
1,901 |
|
$ |
434 |
|
$ |
(8) |
|
$ |
19,849 |
|
Operations |
(247) |
|
44 |
|
60 |
|
52 |
|
(91) |
|
|||||
For the nine months ended September 30, 2021 |
$ |
17,275 |
|
$ |
1,945 |
|
$ |
494 |
|
$ |
44 |
|
$ |
19,758 |
|
|
|
|
|
|
|
||||||||||
|
Operating Companies Income (Loss) |
||||||||||||||
|
Smokeable Products |
Oral
|
Wine |
All Other |
Total |
||||||||||
2021 |
$ |
7,901 |
|
$ |
1,269 |
|
$ |
21 |
|
$ |
(56) |
|
$ |
9,135 |
|
2020 |
7,609 |
|
1,297 |
|
(347) |
|
(63) |
|
8,496 |
|
|||||
% Change |
3.8 |
% |
(2.2) |
% |
100.0%+ |
11.1 |
% |
7.5 |
% |
||||||
|
|
|
|
|
|
||||||||||
Reconciliation: |
|
|
|
|
|
||||||||||
For the nine months ended September 30, 2020 |
$ |
7,609 |
|
$ |
1,297 |
|
$ |
(347) |
|
$ |
(63) |
|
$ |
8,496 |
|
|
|
|
|
|
|
||||||||||
Implementation and acquisition-related costs - 2020 |
? |
|
6 |
|
395 |
|
? |
|
401 |
|
|||||
Tobacco and health and certain other litigation items - 2020 |
73 |
|
? |
|
? |
|
? |
|
73 |
|
|||||
COVID-19 special items - 2020 |
41 |
|
9 |
|
? |
|
? |
|
50 |
|
|||||
|
114 |
|
15 |
|
395 |
|
? |
|
524 |
|
|||||
|
|
|
|
|
|
||||||||||
NPM Adjustment Items - 2021 |
53 |
|
? |
|
? |
|
? |
|
53 |
|
|||||
Implementation, acquisition and disposition-related costs - 2021 |
? |
|
(37) |
|
(52) |
|
? |
|
(89) |
|
|||||
Tobacco and health and certain other litigation items - 2021 |
(72) |
|
? |
|
? |
|
? |
|
(72) |
|
|||||
|
(19) |
|
(37) |
|
(52) |
|
? |
|
(108) |
|
|||||
Operations |
197 |
|
(6) |
|
25 |
|
7 |
|
223 |
|
|||||
For the nine months ended September 30, 2021 |
$ |
7,901 |
|
$ |
1,269 |
|
$ |
21 |
|
$ |
(56) |
|
$ |
9,135 |
|
|
|
|
Schedule 5 |
||||||||||||
ALTRIA GROUP, INC. |
|||||||||||||||
and Subsidiaries |
|||||||||||||||
Supplemental Financial Data |
|||||||||||||||
(dollars in millions) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
For the
|
|
For the Nine Months
|
||||||||||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
The segment detail of excise taxes on products sold is as follows: |
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Smokeable products |
$ |
1,218 |
|
|
$ |
1,407 |
|
|
$ |
3,620 |
|
|
$ |
3,950 |
|
Oral tobacco products |
32 |
|
|
33 |
|
|
98 |
|
|
98 |
|
||||
Wine |
5 |
|
|
5 |
|
|
14 |
|
|
14 |
|
||||
All other |
? |
|
|
? |
|
|
1 |
|
|
1 |
|
||||
|
$ |
1,255 |
|
|
$ |
1,445 |
|
|
$ |
3,733 |
|
|
$ |
4,063 |
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
The segment detail of charges for resolution expenses related to state settlement agreements included in cost of sales is as follows: |
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Smokeable products |
$ |
1,116 |
|
|
$ |
1,206 |
|
|
$ |
3,183 |
|
|
$ |
3,329 |
|
Oral tobacco products |
2 |
|
|
2 |
|
|
7 |
|
|
7 |
|
||||
All other |
? |
|
|
? |
|
|
1 |
|
|
? |
|
||||
|
$ |
1,118 |
|
|
$ |
1,208 |
|
|
$ |
3,191 |
|
|
$ |
3,336 |
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
The segment detail of FDA user fees included in cost of sales is as follows: |
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Smokeable products |
$ |
69 |
|
|
$ |
70 |
|
|
$ |
206 |
|
|
$ |
210 |
|
Oral tobacco products |
1 |
|
|
2 |
|
|
3 |
|
|
4 |
|
||||
|
$ |
70 |
|
|
$ |
72 |
|
|
$ |
209 |
|
|
$ |
214 |
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
The detail of (income) losses from equity investments is as follows: |
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
ABI |
$ |
6,036 |
|
|
$ |
418 |
|
|
$ |
5,644 |
|
|
$ |
306 |
|
Cronos |
(21) |
|
|
54 |
|
|
145 |
|
|
? |
|
||||
JUUL |
(100) |
|
|
? |
|
|
? |
|
|
? |
|
||||
|
$ |
5,915 |
|
|
$ |
472 |
|
|
$ |
5,789 |
|
|
$ |
306 |
|
|
|
|
Schedule 6 |
||
ALTRIA GROUP, INC. |
|||||
and Subsidiaries |
|||||
Net Earnings (Losses) and Diluted (Losses) Earnings Per Share - Attributable to Altria Group, Inc. |
|||||
For the Quarters Ended September 30, |
|||||
(dollars in millions, except per share data) |
|||||
(Unaudited) |
|||||
|
|
|
|
||
|
|
|
|
||
|
Net Earnings (Losses) |
|
Diluted EPS |
||
2021 Net Earnings (Losses) |
$ |
(2,722) |
|
$ |
(1.48) |
2020 Net Earnings (Losses) |
$ |
(952) |
|
$ |
(0.51) |
% Change |
(100)%+ |
|
(100)%+ |
||
|
|
|
|
||
Reconciliation: |
|
|
|
||
2020 Net Earnings (Losses) |
$ |
(952) |
|
$ |
(0.51) |
|
|
|
|
||
2020 Implementation and acquisition-related costs |
8 |
|
? |
||
2020 Tobacco and health and certain other litigation items |
25 |
|
0.01 |
||
2020 Impairment of JUUL equity securities |
2,600 |
|
1.40 |
||
2020 ABI-related special items |
405 |
|
0.22 |
||
2020 Cronos-related special items |
142 |
|
0.08 |
||
2020 Tax items |
(13) |
|
(0.01) |
||
Subtotal 2020 special items |
3,167 |
|
1.70 |
||
|
|
|
|
||
2021 NPM Adjustment Items |
33 |
|
0.02 |
||
2021 Implementation, acquisition and disposition-related costs |
(52) |
|
(0.03) |
||
2021 Tobacco and health and certain other litigation items |
(80) |
|
(0.04) |
||
2021 JUUL changes in fair value |
100 |
|
0.05 |
||
2021 ABI-related special items |
(4,899) |
|
(2.65) |
||
2021 Cronos-related special items |
(89) |
|
(0.05) |
||
2021 Tax items |
8 |
|
? |
||
Subtotal 2021 special items |
(4,979) |
|
(2.70) |
||
|
|
|
|
||
Fewer shares outstanding |
? |
|
0.01 |
||
Change in tax rate |
26 |
|
0.01 |
||
Operations |
16 |
|
0.01 |
||
2021 Net Earnings (Losses) |
$ |
(2,722) |
|
$ |
(1.48) |
|
|
|
|
Schedule 7 |
|||||||||||
ALTRIA GROUP, INC. |
|||||||||||||||
and Subsidiaries |
|||||||||||||||
Reconciliation of GAAP and non-GAAP Measures |
|||||||||||||||
For the Quarters Ended September 30, |
|||||||||||||||
(dollars in millions, except per share data) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
|||||||||||||||
|
|
|
|
|
|
||||||||||
|
Earnings
|
Provision
|
Net
|
Net Earnings
|
Diluted
|
||||||||||
2021 Reported |
$ |
(3,302) |
|
$ |
(582) |
|
$ |
(2,720) |
|
$ |
(2,722) |
|
$ |
(1.48) |
|
NPM Adjustment Items |
(44) |
|
(11) |
|
(33) |
|
(33) |
|
(0.02) |
|
|||||
Implementation, acquisition and disposition-related costs |
61 |
|
9 |
|
52 |
|
52 |
|
0.03 |
|
|||||
Tobacco and health and certain other litigation items |
105 |
|
25 |
|
80 |
|
80 |
|
0.04 |
|
|||||
JUUL changes in fair value |
(100) |
|
? |
|
(100) |
|
(100) |
|
(0.05) |
|
|||||
ABI-related special items |
6,200 |
|
1,301 |
|
4,899 |
|
4,899 |
|
2.65 |
|
|||||
Cronos-related special items |
89 |
|
? |
|
89 |
|
89 |
|
0.05 |
|
|||||
Tax items |
? |
|
8 |
|
(8) |
|
(8) |
|
? |
|
|||||
2021 Adjusted for Special Items |
$ |
3,009 |
|
$ |
750 |
|
$ |
2,259 |
|
$ |
2,257 |
|
$ |
1.22 |
|
|
|
|
|
|
|
||||||||||
2020 Reported |
$ |
(324) |
|
$ |
632 |
|
$ |
(956) |
|
$ |
(952) |
|
$ |
(0.51) |
|
Implementation and acquisition-related costs |
12 |
|
4 |
|
8 |
|
8 |
|
? |
|
|||||
Tobacco and health and certain other litigation items |
34 |
|
9 |
|
25 |
|
25 |
|
0.01 |
|
|||||
Impairment of JUUL equity securities |
2,600 |
|
? |
|
2,600 |
|
2,600 |
|
1.40 |
|
|||||
ABI-related special items |
513 |
|
108 |
|
405 |
|
405 |
|
0.22 |
|
|||||
Cronos-related special items |
143 |
|
1 |
|
142 |
|
142 |
|
0.08 |
|
|||||
Tax items |
? |
|
13 |
|
(13) |
|
(13) |
|
(0.01) |
|
|||||
2020 Adjusted for Special Items |
$ |
2,978 |
|
$ |
767 |
|
$ |
2,211 |
|
$ |
2,215 |
|
$ |
1.19 |
|
|
|
|
|
|
|
||||||||||
2021 Reported Net Earnings (Losses) |
|
|
|
$ |
(2,722) |
|
$ |
(1.48) |
|
||||||
2020 Reported Net Earnings (Losses) |
|
|
|
$ |
(952) |
|
$ |
(0.51) |
|
||||||
% Change |
|
|
|
(100)%+ |
(100)%+ |
||||||||||
|
|
|
|
|
|
||||||||||
2021 Net Earnings Adjusted for Special Items |
|
|
$ |
2,257 |
|
$ |
1.22 |
|
|||||||
2020 Net Earnings Adjusted for Special Items |
|
|
$ |
2,215 |
|
$ |
1.19 |
|
|||||||
% Change |
|
|
|
1.9 |
% |
2.5 |
% |
|
|
|
Schedule 8 |
||||
ALTRIA GROUP, INC. |
|||||||
and Subsidiaries |
|||||||
Net Earnings (Losses) and Diluted Earnings Per Share - Attributable to Altria Group, Inc. |
|||||||
For the Nine Months Ended September 30, |
|||||||
(dollars in millions, except per share data) |
|||||||
(Unaudited) |
|||||||
|
|
|
|
||||
|
|
|
|
||||
|
Net Earnings
|
|
Diluted
|
||||
2021 Net Earnings (Losses) |
$ |
851 |
|
|
$ |
0.46 |
|
2020 Net Earnings (Losses) |
$ |
2,543 |
|
|
$ |
1.36 |
|
% Change |
(66.5) |
% |
|
(66.2) |
% |
||
|
|
|
|
||||
Reconciliation: |
|
|
|
||||
2020 Net Earnings (Losses) |
$ |
2,543 |
|
|
$ |
1.36 |
|
|
|
|
|
||||
2020 Implementation and acquisition-related costs |
314 |
|
|
0.17 |
|
||
2020 Tobacco and health and certain other litigation items |
57 |
|
|
0.03 |
|
||
2020 Impairment of JUUL equity securities |
2,600 |
|
|
1.40 |
|
||
2020 ABI-related special items |
544 |
|
|
0.29 |
|
||
2020 Cronos-related special items |
143 |
|
|
0.08 |
|
||
2020 COVID-19 special items |
37 |
|
|
0.02 |
|
||
2020 Tax items |
38 |
|
|
0.02 |
|
||
Subtotal 2020 special items |
3,733 |
|
|
2.01 |
|
||
|
|
|
|
||||
2021 NPM Adjustment Items |
57 |
|
|
0.03 |
|
||
2021 Implementation, acquisition and disposition-related costs |
(95) |
|
|
(0.05) |
|
||
2021 Tobacco and health and certain other litigation items |
(113) |
|
|
(0.06) |
|
||
2021 ABI-related special items |
(4,828) |
|
|
(2.60) |
|
||
2021 Cronos-related special items |
(205) |
|
|
(0.11) |
|
||
2021 Loss on early extinguishment of debt |
(496) |
|
|
(0.27) |
|
||
2021 Tax items |
5 |
|
|
? |
|
||
Subtotal 2021 special items |
(5,675) |
|
|
(3.06) |
|
||
|
|
|
|
||||
Fewer shares outstanding |
? |
|
|
0.02 |
|
||
Change in tax rate |
(18) |
|
|
(0.01) |
|
||
Operations |
268 |
|
|
0.14 |
|
||
2021 Net Earnings (Losses) |
$ |
851 |
|
|
$ |
0.46 |
|
|
|
|
|
1 Diluted earnings (losses) per share attributable to Altria are computed independently for each period. Accordingly, the sum of the quarterly earnings (losses) per share amounts may not agree to the year-to-date amounts.
|
|
|
|
Schedule 9 |
|||||||||||
ALTRIA GROUP, INC. |
|||||||||||||||
and Subsidiaries |
|||||||||||||||
Reconciliation of GAAP and non-GAAP Measures |
|||||||||||||||
For the Nine Months Ended September 30, |
|||||||||||||||
(dollars in millions, except per share data) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
|||||||||||||||
|
|
|
|
|
|
||||||||||
|
Earnings (Losses)
|
Provision (benefit)
|
Net
|
Net Earnings
|
Diluted
|
||||||||||
2021 Reported |
$ |
1,544 |
|
$ |
693 |
|
$ |
851 |
|
$ |
851 |
|
$ |
0.46 |
|
NPM Adjustment Items |
(76) |
|
(19) |
|
(57) |
|
(57) |
|
(0.03) |
|
|||||
Implementation, acquisition and disposition-related costs |
117 |
|
22 |
|
95 |
|
95 |
|
0.05 |
|
|||||
Tobacco and health and certain other litigation items |
148 |
|
35 |
|
113 |
|
113 |
|
0.06 |
|
|||||
ABI-related special items |
6,111 |
|
1,283 |
|
4,828 |
|
4,828 |
|
2.60 |
|
|||||
Cronos-related special items |
200 |
|
(5) |
|
205 |
|
205 |
|
0.11 |
|
|||||
Loss on early extinguishment of debt |
649 |
|
153 |
|
496 |
|
496 |
|
0.27 |
|
|||||
Tax items |
? |
|
5 |
|
(5) |
|
(5) |
|
? |
|
|||||
2021 Adjusted for Special Items |
$ |
8,693 |
|
$ |
2,167 |
|
$ |
6,526 |
|
$ |
6,526 |
|
$ |
3.52 |
|
|
|
|
|
|
|
||||||||||
2020 Reported |
$ |
4,349 |
|
$ |
1,817 |
|
$ |
2,532 |
|
$ |
2,543 |
|
$ |
1.36 |
|
Implementation and acquisition-related costs |
415 |
|
101 |
|
314 |
|
314 |
|
0.17 |
|
|||||
Tobacco and health and certain other litigation items |
76 |
|
19 |
|
57 |
|
57 |
|
0.03 |
|
|||||
Impairment of JUUL equity securities |
2,600 |
|
? |
|
2,600 |
|
2,600 |
|
1.40 |
|
|||||
ABI-related special items |
689 |
|
145 |
|
544 |
|
544 |
|
0.29 |
|
|||||
Cronos-related special items |
144 |
|
1 |
|
143 |
|
143 |
|
0.08 |
|
|||||
COVID-19 special items |
50 |
|
13 |
|
37 |
|
37 |
|
0.02 |
|
|||||
Tax items |
? |
|
(38) |
|
38 |
|
38 |
|
0.02 |
|
|||||
2020 Adjusted for Special Items |
$ |
8,323 |
|
$ |
2,058 |
|
$ |
6,265 |
|
$ |
6,276 |
|
$ |
3.37 |
|
|
|
|
|
|
|
||||||||||
2021 Reported Net Earnings (Losses) |
|
|
|
$ |
851 |
|
$ |
0.46 |
|
||||||
2020 Reported Net Earnings (Losses) |
|
|
|
$ |
2,543 |
|
$ |
1.36 |
|
||||||
% Change |
|
|
|
(66.5) |
% |
(66.2) |
% |
||||||||
|
|
|
|
|
|
||||||||||
2021 Net Earnings Adjusted for Special Items |
|
|
$ |
6,526 |
|
$ |
3.52 |
|
|||||||
2020 Net Earnings Adjusted for Special Items |
|
|
$ |
6,276 |
|
$ |
3.37 |
|
|||||||
% Change |
|
|
|
4.0 |
% |
4.5 |
% |
||||||||
|
|
|
|
|
|
1 Diluted earnings (losses) per share attributable to Altria are computed independently for each period. Accordingly, the sum of the quarterly earnings (losses) per share amounts may not agree to the year-to-date amounts.
|
|
|
|
Schedule 10 |
|||||||||||
ALTRIA GROUP, INC. |
|||||||||||||||
and Subsidiaries |
|||||||||||||||
Reconciliation of GAAP and non-GAAP Measures |
|||||||||||||||
For the Year Ended December 31, 2020 |
|||||||||||||||
(dollars in millions, except per share data) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
||||||||||
|
Earnings
|
Provision
|
Net
|
Net Earnings
|
Diluted
|
||||||||||
2020 Reported |
$ |
6,890 |
|
$ |
2,436 |
|
$ |
4,454 |
|
$ |
4,467 |
|
$ |
2.40 |
|
NPM Adjustment Items |
4 |
|
1 |
|
3 |
|
3 |
|
? |
|
|||||
Asset impairment, exit, implementation and acquisition-related costs |
431 |
|
89 |
|
342 |
|
342 |
|
0.18 |
|
|||||
Tobacco and health and certain other litigation items |
83 |
|
21 |
|
62 |
|
62 |
|
0.03 |
|
|||||
Impairment in JUUL equity securities |
2,600 |
|
? |
|
2,600 |
|
2,600 |
|
1.40 |
|
|||||
JUUL changes in fair value |
(100) |
|
? |
|
(100) |
|
(100) |
|
(0.05) |
|
|||||
ABI-related special items |
763 |
|
160 |
|
603 |
|
603 |
|
0.32 |
|
|||||
Cronos-related special items |
51 |
|
(2) |
|
53 |
|
53 |
|
0.03 |
|
|||||
COVID-19 special items |
50 |
|
13 |
|
37 |
|
37 |
|
0.02 |
|
|||||
Tax items |
? |
|
(50) |
|
50 |
|
50 |
|
0.03 |
|
|||||
2020 Adjusted for Special Items |
$ |
10,772 |
|
$ |
2,668 |
|
$ |
8,104 |
|
$ |
8,117 |
|
$ |
4.36 |
|
|
|
|
Schedule 11 |
||||
ALTRIA GROUP, INC. |
|||||||
and Subsidiaries |
|||||||
Condensed Consolidated Balance Sheets |
|||||||
(dollars in millions) |
|||||||
(Unaudited) |
|||||||
|
|
|
|
||||
|
September 30, 2021 |
|
December 31, 2020 |
||||
Assets |
|
|
|
||||
Cash and cash equivalents |
$ |
2,957 |
|
|
$ |
4,945 |
|
Inventories |
1,133 |
|
|
1,966 |
|
||
Assets held for sale |
1,490 |
|
|
? |
|
||
Other current assets |
440 |
|
|
206 |
|
||
Property, plant and equipment, net |
1,518 |
|
|
2,012 |
|
||
Goodwill and other intangible assets, net |
17,503 |
|
|
17,792 |
|
||
Investments in equity securities |
13,874 |
|
|
19,529 |
|
||
Other long-term assets |
649 |
|
|
964 |
|
||
Total assets |
$ |
39,564 |
|
|
$ |
47,414 |
|
|
|
|
|
||||
Liabilities and Stockholders' (Deficit) Equity |
|
|
|
||||
Current portion of long-term debt |
$ |
1,105 |
|
|
$ |
1,500 |
|
Accrued settlement charges |
2,996 |
|
|
3,564 |
|
||
Liabilities held for sale |
295 |
|
|
? |
|
||
Other current liabilities |
3,716 |
|
|
3,999 |
|
||
Long-term debt |
27,022 |
|
|
27,971 |
|
||
Deferred income taxes |
3,557 |
|
|
4,532 |
|
||
Accrued pension costs |
280 |
|
|
551 |
|
||
Accrued postretirement health care costs |
1,512 |
|
|
1,951 |
|
||
Other long-term liabilities |
307 |
|
|
381 |
|
||
Total liabilities |
40,790 |
|
|
44,449 |
|
||
Redeemable noncontrolling interest |
39 |
|
|
40 |
|
||
Total stockholders' (deficit) equity |
(1,265) |
|
|
2,925 |
|
||
Total liabilities and stockholders' (deficit) equity |
$ |
39,564 |
|
|
$ |
47,414 |
|
|
|
|
|
||||
Total debt |
$ |
28,127 |
|
|
$ |
29,471 |
|
|
|
|
|
|
|
|
|
|
|
|
Schedule 12 |
||||||||||||||
ALTRIA GROUP, INC. |
|||||||||||||||||||||
and Subsidiaries |
|||||||||||||||||||||
Supplemental Financial Data for Special Items |
|||||||||||||||||||||
For the Quarters Ended September 30, |
|||||||||||||||||||||
(dollars in millions) |
|||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||
|
|||||||||||||||||||||
|
|
|
|
|
|
|
|
||||||||||||||
|
Cost of Sales |
Marketing, administration and research costs |
General corporate expenses |
Interest and other debt expense, net |
(Income) losses
|
Impairment of
|
(Gain) loss on
|
||||||||||||||
2021 Special Items - (Income) Expense |
|
|
|
|
|
|
|
||||||||||||||
NPM Adjustment Items |
$ |
(21) |
|
$ |
? |
|
$ |
? |
|
$ |
(23) |
|
$ |
? |
|
$ |
? |
|
$ |
? |
|
Implementation, acquisition and disposition-related costs |
? |
|
51 |
|
10 |
|
? |
|
? |
|
? |
|
? |
|
|||||||
Tobacco and health and certain other litigation items |
? |
|
29 |
|
70 |
|
6 |
|
? |
|
? |
|
? |
|
|||||||
JUUL changes in fair value |
? |
|
? |
|
? |
|
? |
|
(100) |
|
? |
|
? |
|
|||||||
ABI-related special items |
? |
|
? |
|
? |
|
? |
|
6,200 |
|
|
? |
|
||||||||
Cronos-related special items |
? |
|
? |
|
? |
|
? |
|
(46) |
|
? |
|
135 |
|
|||||||
|
|
|
|
|
|
|
|
||||||||||||||
2020 Special Items - (Income) Expense |
|
|
|
|
|
|
|
||||||||||||||
Implementation and acquisition-related costs |
$ |
1 |
|
$ |
4 |
|
$ |
7 |
|
$ |
? |
|
$ |
? |
|
$ |
? |
|
$ |
? |
|
Tobacco and health and certain other litigation items |
? |
|
34 |
|
? |
|
? |
|
? |
|
? |
|
? |
|
|||||||
Impairment of JUUL equity securities |
? |
|
? |
|
? |
|
? |
|
? |
|
2,600 |
|
? |
|
|||||||
ABI-related special items |
? |
|
? |
|
? |
|
? |
|
513 |
|
? |
|
? |
|
|||||||
Cronos-related special items |
? |
|
? |
|
? |
|
? |
|
38 |
|
? |
|
105 |
|
Note: This schedule is intended to provide supplemental financial data for certain income and expense items that management believes are not part of underlying operations and their presentation in Altria's consolidated statements of earnings. This schedule is not intended to provide, or reconcile, non-GAAP financial measures.
|
|
|
|
|
|
|
|
Schedule 13 |
||||||||||||||||
ALTRIA GROUP, INC. |
||||||||||||||||||||||||
and Subsidiaries |
||||||||||||||||||||||||
Supplemental Financial Data for Special Items |
||||||||||||||||||||||||
For the Nine Months Ended September 30, |
||||||||||||||||||||||||
(dollars in millions) |
||||||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||||||
|
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Cost of Sales |
Marketing, administration and research costs |
General corporate expenses |
Interest and other debt expense, net |
Loss on early extinguishment of debt |
(Income) losses
|
Impairment of
|
(Gain) loss on
|
||||||||||||||||
2021 Special Items - (Income) Expense |
|
|
|
|
|
|
|
|
||||||||||||||||
NPM Adjustment Items |
$ |
(53) |
|
$ |
? |
|
$ |
? |
|
$ |
(23) |
|
$ |
? |
|
$ |
? |
|
$ |
? |
|
$ |
? |
|
Implementation, acquisition and disposition-related costs |
1 |
|
88 |
|
28 |
|
? |
|
? |
|
? |
|
? |
|
? |
|
||||||||
Tobacco and health and certain other litigation items |
? |
|
72 |
|
70 |
|
6 |
|
? |
|
? |
|
? |
|
? |
|
||||||||
JUUL changes in fair value |
? |
|
? |
|
? |
|
? |
|
? |
|
? |
|
? |
|
? |
|
||||||||
ABI-related special items |
? |
|
? |
|
? |
|
? |
|
? |
|
6,111 |
|
? |
|
? |
|
||||||||
Cronos-related special items |
? |
|
? |
|
? |
|
? |
|
? |
|
72 |
|
? |
|
128 |
|
||||||||
Loss on early extinguishment of debt |
? |
|
? |
|
? |
|
? |
|
649 |
|
? |
|
? |
|
? |
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||||||||
2020 Special Items - (Income) Expense |
|
|
|
|
|
|
|
|
||||||||||||||||
Implementation and acquisition-related costs |
$ |
395 |
|
$ |
6 |
|
$ |
14 |
|
$ |
? |
|
$ |
? |
|
$ |
? |
|
$ |
? |
|
$ |
? |
|
Tobacco and health and certain other litigation items |
? |
|
73 |
|
? |
|
3 |
|
? |
|
? |
|
? |
|
? |
|
||||||||
Impairment of JUUL equity securities |
? |
|
? |
|
? |
|
? |
|
|
? |
|
2,600 |
|
? |
|
|||||||||
ABI-related special items |
? |
|
? |
|
? |
|
? |
|
? |
|
689 |
|
? |
|
? |
|
||||||||
Cronos-related special items |
? |
|
? |
|
? |
|
? |
|
? |
|
(58) |
|
? |
|
202 |
|
||||||||
COVID-19 special items |
50 |
|
? |
|
? |
|
? |
|
? |
|
? |
|
? |
|
? |
|
Note: This schedule is intended to provide supplemental financial data for certain income and expense items that management believes are not part of underlying operations and their presentation in Altria's consolidated statements of earnings. This schedule is not intended to provide, or reconcile, non-GAAP financial measures.
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