Altria Group, Inc.
Regulatory News:
-- Reported diluted earnings per share from continuing operations up 5.0%
to $1.05, including charges of $0.12 per share for asset impairment and
exit costs, as well as other items detailed on Schedule 7
-- Adjusted diluted earnings per share from continuing operations up 9.5%
to $1.15 versus $1.05 in 2006
-- Full-year 2007 reported diluted earnings per share from continuing
operations revised to a range of $4.05 to $4.10, reflecting $0.15 in
additional charges for asset impairment and exit costs, versus a
previously announced range of $4.20 to $4.25
Altria Group, Inc. (NYSE: MO) today announced second-quarter reported diluted
earnings per share from continuing operations of $1.05, up 5.0% versus the prior
year, including charges of $0.12 per share for asset impairment and exit costs,
primarily related to the previously announced closing of Philip Morris USA's (PM
USA) cigarette manufacturing facility in Cabarrus, NC as well as other items
detailed on the attached Schedule 7. After adjusting results as detailed in the
table below, diluted earnings per share from continuing operations were up 9.5%
to $1.15, versus $1.05 in the corresponding prior-year period.
"Altria had a solid quarter. The underlying fundamentals in our tobacco
businesses remained strong, with operating companies income well ahead of the
prior-year period when adjusted for the impact of asset impairment and exit
costs," said Louis C. Camilleri, chairman and chief executive officer of Altria
Group, Inc. "In our U.S. tobacco business, Marlboro achieved a record retail
share of 41.0%. In our international tobacco business, operating companies
income adjusted for asset impairment and exit costs grew 7.2%, and Philip Morris
International (PMI) continued to introduce innovative products including
Marlboro Filter Plus in Korea, Ukraine and Russia, L&M Essence in a number of
key markets and Marlboro kretek in Indonesia in early July."
Conference Call
A conference call with members of the investment community and news media will
be Webcast at 9:00 a.m. Eastern Time on July 18, 2007. Access is available at
www.altria.com.
2007 Second-Quarter Results Excluding Items
After adjusting for the items shown in the table below, diluted earnings per
share from continuing operations increased 9.5% to $1.15 for the second quarter
of 2007.
Second Quarter
---------------
2007 2006 Change
------- ------- ------
Reported diluted EPS from continuing operations $1.05 $1.00 5.0%
Asset impairment and exit costs 0.12 0.02
(Recoveries) provision for airline industry
exposure (0.02) 0.03
Diluted EPS, excluding above items $1.15 $1.05 9.5%
2007 Full-Year Forecast
Altria revised its forecast to a range of $4.05 to $4.10 for reported 2007
full-year diluted earnings per share from continuing operations, reflecting
$0.15 in additional charges for asset impairment and exit costs, versus its
previously announced range of $4.20 to $4.25. The revised projection includes
charges of $0.24 per share, which are $0.15 per share higher ($0.12 for PM USA
and $0.03 for PMI) than the $0.09 in previously forecasted charges. The
projection also includes $0.06 per share for cash recoveries at Philip Morris
Capital Corporation (PMCC), which were recorded in the first half of 2007.
The factors described in the Forward-Looking and Cautionary Statements section
of this release represent continuing risks to this projection.
Manufacturing Optimization Program
On June 26, 2007 Altria announced plans by its tobacco operating subsidiaries to
optimize worldwide cigarette production by moving U.S.-based cigarette
production for non-U.S. markets to PMI facilities in Europe. PMI is expected to
shift sourcing of approximately 57 billion cigarettes to facilities in Europe by
the third quarter of 2008, while PM USA will close its Cabarrus, NC
manufacturing facility by the end of 2010 and consolidate manufacturing for the
U.S. market at its Richmond, VA Manufacturing Center.
PM USA recorded an initial pre-tax charge of $318 million or $0.10 per share in
the second quarter of 2007 for costs related to the program, primarily for
employee separation, with additional estimated pre-tax charges of approximately
$55 million or $0.02 per share for the remainder of 2007. The program is
expected to generate cost savings beginning in 2008, with total estimated annual
cost savings of approximately $335 million by 2011, of which $179 million will
be realized by PMI and $156 million by PM USA. Cumulative total expenses through
2011 are estimated at approximately $670 million, all of which will be at PM
USA.
PMI Announces Agreement in Principle to Acquire Additional 30% Stake in Mexican
Tobacco Business
On July 18, PMI announced that it had reached an agreement in principle to
acquire an additional 30% stake in its Mexican tobacco business from its joint
venture partner, Grupo Carso, S.A.B. de C.V.
PMI currently holds a 50% stake in its Mexican tobacco business and this
transaction would bring PMI's stake to 80%. Grupo Carso would retain a 20% stake
in the business.
The transaction has a value of approximately $1.1 billion and is expected to be
completed later this year, subject to execution of definitive agreements and
customary regulatory approvals. When completed, the transaction is expected to
increase Altria's annualized net earnings by approximately $0.03 per share.
ALTRIA GROUP, INC.
As described in "Note 15. Segment Reporting" of Altria Group, Inc.'s 2006 Annual
Report, management reviews operating companies income, which is defined as
operating income before corporate expenses and amortization of intangibles, to
evaluate segment performance and allocate resources. Management believes it is
appropriate to disclose this measure to help investors analyze business
performance and trends. For a reconciliation of operating companies income to
operating income, see the Condensed Statements of Earnings contained in this
release.
Altria Group, Inc.'s 2007 reported results and previous-year results reflect
Kraft as a discontinued operation. As such, net revenues and operating companies
income for Kraft are excluded from the company's results, while the net earnings
impact is included as a single line item.
The products of Altria's subsidiaries include cigarettes and other tobacco
products manufactured and sold by Philip Morris USA (PM USA) in the United
States and by Philip Morris International (PMI) outside the United States. PMI's
operations are organized and managed by geographic region. Beginning with the
second quarter of 2007, Altria's reportable segments are U.S. Tobacco; European
Union (EU); Eastern Europe, Middle East & Africa (EEMA); Asia; Latin America;
and Financial Services.
All references in this news release are to continuing operations, unless
otherwise noted. References to international tobacco market shares are PMI
estimates based on a number of sources.
Schedules with restated results by reportable segments for the years 2006 and
2007 are attached.
2007 Second-Quarter Results
Revenues net of excise taxes and currency increased 2.9% to $9.5 billion for the
second quarter of 2007, driven by all segments except PMCC.
Operating income increased 0.6% to $3.2 billion, reflecting the items described
in the attached reconciliation on Schedule 3, including higher results from
operations of $126 million, favorable currency of $87 million and the net impact
of a cash recovery of $78 million at PMCC from assets which had been previously
written down, compared to a provision of $103 million at PMCC in the second
quarter of 2006. Largely offsetting those factors were asset impairment and exit
costs of $394 million, primarily at PM USA.
Earnings from continuing operations increased 4.9% to $2.2 billion, reflecting
the items above as well as a decrease in interest expense due to lower debt
outstanding. The company's effective tax rate at 33.5% was unchanged for the
second quarter of 2007 versus the year-earlier period.
Net earnings, including discontinued operations, decreased 18.3% to $2.2
billion, primarily due to the Kraft spin-off and the factors mentioned above.
Diluted earnings per share, including discontinued operations as detailed on
Schedule 1, decreased 18.6% to $1.05.
U.S. TOBACCO
2007 Second-Quarter Results
Philip Morris USA (PM USA), Altria Group, Inc.'s U.S. tobacco business, reported
that its second-quarter revenues net of excise taxes increased 1.5% to $3.9
billion. Operating companies income decreased 22.8% to $1.0 billion compared to
the year-earlier period. The decline was largely a result of the $318 million
pre-tax charge for asset impairment and exit costs related to the previously
announced closure of the Cabarrus, NC cigarette manufacturing facility, as well
as lower volume and increased resolution expenses, partially offset by lower
wholesale promotional allowance rates and lower expenses for marketing,
administrative and research costs. Adjusted for the $318 million in asset
impairment and exit costs, PM USA's operating companies income would have
increased by 1.6% to $1.3 billion.
PM USA's cigarette shipment volume of 45.6 billion units was 3.3% or 1.6 billion
units lower than that recorded in the prior-year period. In the first half of
2007, PM USA estimates that total cigarette industry volume declined between 4%
and 5%, and for the full year 2007 PM USA is maintaining its prior estimate of a
3% to 4% decline in total cigarette industry volume.
Cigarette volume performance by brand for PM USA is summarized in the table
below:
Philip Morris USA Cigarette Volume* by Brand (Billion Units)
----------------------------------------------------------------------
Q2 2007 Q2 2006 Change**
------- ------- --------
Marlboro 37.7 38.6 - 2.3%
Parliament 1.5 1.5 - 2.1%
Virginia Slims 1.8 2.0 - 6.3%
Basic 3.5 3.8 - 8.1%
------- -------
Focus Brands 44.5 45.9 - 2.9%
Other PM USA 1.1 1.3 -15.2%
------- -------
Total PM USA 45.6 47.2 - 3.3%
* U.S. unit volume includes units sold as well as promotional units, and
excludes Puerto Rico and U.S. Territories.
** Calculation based on millions of units.
PM USA's total retail share was unchanged at 50.5% in the second quarter of 2007
versus the prior-year period. However, Marlboro had a strong gain of 0.4 retail
share points. Marlboro Smooth performed well in the second quarter of 2007,
contributing to Marlboro's overall performance. Marlboro Smooth was introduced
nationally in March and offers adult smokers a uniquely rich and smooth menthol
taste. Parliament's retail share was unchanged, while Virginia Slims and Basic
declined by 0.1 and 0.2 share points, respectively.
PM USA's cigarette retail share performance by brand is summarized in the table
below:
Philip Morris USA Cigarette Retail Share* by Brand
----------------------------------------------------------------------
Q2 2007 Q2 2006 Change
------- ------- -------
Marlboro 41.0% 40.6% +0.4 pp
Parliament 1.9% 1.9% --
Virginia Slims 2.2% 2.3% -0.1 pp
Basic 4.0% 4.2% -0.2 pp
------- -------
Focus Brands 49.1% 49.0% +0.1 pp
Other PM USA 1.4% 1.5% -0.1 pp
------- -------
Total PM USA 50.5% 50.5% --
* Retail share performance is based on data from the IRI/Capstone
Total Retail Panel, which is a tracking service that uses a sample of
stores to project market share performance in retail stores selling
cigarettes. The panel was not designed to capture sales through other
channels, including Internet and direct mail.
PM USA is announcing today that it will introduce Marlboro Smooth 100's Box and
Marlboro Virginia Blend King Box and 100's Box at retail in September. Based on
the success of Marlboro Smooth, PM USA is expanding the brand with Marlboro
Smooth 100's Box, which will offer the same uniquely rich and smooth taste to
the more than 40% of menthol adult smokers that choose the 100's format.
Marlboro's newest offering is Marlboro Virginia Blend, a single-leaf blend
crafted from U.S.-grown Virginia (Bright) tobaccos, which has a distinctive
crisp and mellow taste and is intended for adult smokers looking for a new
flavor experience. Both products reinforce the Marlboro tradition of flavor and
its position as the leader in the premium category.
As part of its tobacco category adjacency strategy to develop new revenue and
income sources for the future, PM USA announced that it will test market
Marlboro Snus in the Dallas/Fort Worth, Texas, area beginning in August 2007.
Marlboro Snus is a spit-free tobacco pouch product that utilizes a unique flavor
strip and dried tobacco.
INTERNATIONAL TOBACCO
2007 Second-Quarter Results
Philip Morris International (PMI), Altria Group, Inc.'s international tobacco
business, reported that its revenues net of excise taxes and currency increased
4.0% to $5.6 billion. Operating companies income grew 4.7% to $2.2 billion, due
primarily to higher pricing and favorable currency of $87 million, partially
offset by asset impairment and exit costs of $76 million.
Cigarette shipment volume increased 3.3% or 7.1 billion units to 221.0 billion
units, due largely to acquisition volume from Lakson Tobacco in Pakistan. Gains
in Argentina, Egypt, Indonesia, Korea, the Philippines and Ukraine, as well as
the favorable timing of shipments in certain markets, were offset by shipment
declines in Russia, Germany and the Czech Republic, as well as Japan, where
comparisons to the second quarter of 2006 were distorted by heavy trade
purchases in anticipation of the July 2006 excise tax increase. Excluding the
impact of acquisitions, PMI's cigarette shipment volume was down 0.5%.
PMI's volume performance by segment is summarized in the table below:
Philip Morris International Cigarette Volume by Segment (Billion
Units)
----------------------------------------------------------------------
Q2 2007 Q2 2006 Change*
------- ------- -------
European Union 67.8 68.4 - 0.9%
Eastern Europe, Middle East & Africa 75.9 75.3 + 0.8%
Asia 55.8 48.1 +15.9%
Latin America 21.5 22.1 - 2.6%
------- -------
Total PMI 221.0 213.9 3.3%
*Calculation based on millions of units.
PMI's market share in the second quarter of 2007 advanced in many countries,
including Argentina, Australia, Austria, Belgium, the Czech Republic, Egypt,
France, Italy, Korea, Mexico, Netherlands, Russia, Serbia, the Philippines,
Portugal and Ukraine.
Total Marlboro cigarette shipment volume of 81.1 billion units was down 0.5%.
Lower Marlboro volume in Germany, Japan and Turkey was partially offset by gains
in Argentina, Korea, Poland, Romania and Russia. Marlboro market share was up in
many markets, including Argentina, Brazil, the Czech Republic, Egypt, France,
Hungary, Indonesia, Kazakhstan, Korea, Kuwait, Mexico, Netherlands, Poland,
Russia, Saudi Arabia, Serbia and Ukraine.
EUROPEAN UNION
2007 Second-Quarter Results
In the European Union (EU), PMI's cigarette shipment volume of 67.8 billion
units was down 0.9%, due mainly to declines in the Czech Republic and Germany
and unfavorable distributor inventory movements in France and Italy. However,
cigarette market share in the EU rose 0.4 points to 39.7%, representing
quarter-over-quarter market share growth for three consecutive periods.
Operating companies income increased 12.3% to $1.1 billion, due primarily to
higher pricing and favorable currency of $85 million.
In the Czech Republic, the total cigarette market was down 26.6% due to trade
purchases prior to the March 2007 excise tax increase. PMI's shipment volume
declined 22.7%, but market share increased 3.1 points to 60.4%.
In France, PMI's market share continued its forward momentum, reaching 43.4% in
the second quarter, up 0.6 points versus the same period last year. Both
Marlboro and the Philip Morris brand drove this growth. PMI's shipment volume
was down 2.6%, reflecting unfavorable distributor inventory movements compared
to last year.
In the German market, total tobacco consumption was down 4.7% and PMI's share of
total tobacco consumption declined 0.7 points to 30.1%. The cigarette market
decreased 2.5%, mainly driven by the effects of higher prices and PMI's
cigarette volume decreased 4.0%. PMI's cigarette market share declined 0.6
points to 37.0%, reflecting a 38.4% volume decline in the vending channel. The
vending channel accounted for 15% of total industry volume in the quarter,
compared to 23.7% in the comparative period last year due to the reduction in
vending machines resulting from new regulations that require electronic age
verification. PMI's share of the vending channel at 51% is over-indexed relative
to its overall market share, and as a consequence PMI has been adversely
impacted by this development. PMI expects the volume share of the vending
channel to gradually improve. Marlboro share was down 2.8 points to 26.1%, with
most of this decline being driven by shrinkage in the vending channel. L&M
continued to grow strongly, adding 2.5 share points to reach 4.7%.
In Italy, PMI's powerful and broad brand portfolio drove share up 1.0 point to
54.6%. Merit, Chesterfield, Philip Morris and Muratti all contributed to the
growth. Marlboro remains resilient and its share at 22.8% was unchanged versus
last year. The total industry in Italy declined moderately by 1.4%, and although
PMI's shipment volume declined 4.7%, this was wholly due to unfavorable
distributor inventory movements and the timing of shipments.
The Spanish market has achieved stability and declined less than 1% in the
second quarter of 2007. PMI's market share at 31.5% was down 0.1 point from last
year, as share gains for Chesterfield and L&M offset a 0.6 point decline for
Marlboro. PMI's shipment volume rose 2.8%, but was essentially flat when
adjusted for favorable trade inventory movements.
EASTERN EUROPE, MIDDLE EAST & AFRICA
2007 Second-Quarter Results
In Eastern Europe, Middle East & Africa, PMI's cigarette shipment volume of 75.9
billion units was up 0.8%, due to gains in Ukraine and Egypt and the timing of
shipments in Saudi Arabia and Israel, partially offset by the continued decline
of L&M in Turkey and Russia, and lower worldwide duty-free volume. Operating
companies income increased 12.4% to $634 million, due mainly to improved
pricing, volume/mix and favorable currency of $21 million.
In Egypt, shipment volume rose 23.3%, driven mainly by L&M, while market share
grew 1.4 points to 11.4%.
In Russia, shipment volume was down 2.6%, but share rose 0.2 points to 26.7%, as
several brands in PMI's strong portfolio, including Marlboro, Parliament,
Virginia Slims and Chesterfield increased share, helping to more than offset a
0.6 point loss for L&M. PMI's brand portfolio in Russia was also strengthened by
new brand initiatives, including Muratti Slims, Virginia Slims Uno in an
innovative package and Marlboro Filter Plus. In addition, profitability in
Russia continued to grow strongly, driven by an improving brand mix and better
pricing.
In Turkey, shipment volume was down 4.4% and market share declined 2.7 points to
40.2%, due mainly to the decline of L&M and Lark, which face intense competition
at the low-price end of the market. Marlboro's share was down slightly, but
Parliament was up 0.8 points to 5.8%, further cementing PMI's commanding share
in the premium segment.
In Ukraine, shipment volume grew 4.3% and market share rose 0.5 points to 33.7%.
Marlboro share advanced 0.5 points to 5.1%, as consumers continued to trade up
to international brands at the expense of local brands. Parliament and
Chesterfield also grew strongly. During the second quarter of 2007, PMI launched
a new line-up of cigarette products for L&M and initial results are encouraging.
ASIA
2007 Second-Quarter Results
In Asia, PMI's cigarette shipment volume of 55.8 billion units rose 15.9%, due
to acquisition volume in Pakistan and gains in Korea, Indonesia and the
Philippines, partially offset by a volume decline in Japan. Excluding acquired
volume, shipment volume in Asia declined 1.2%. Operating companies income
decreased 12.1% to $429 million, due to unfavorable currency of $22 million and
unfavorable volume/mix, primarily in Japan.
In Indonesia, PMI shipment volume rose 1.3%. Market share of 28.0% was down
slightly, reflecting the impact of the tax-driven price increase that took
effect in May, following the March 2007 excise tax increase. A Hijau's share
rose 0.8 points to 6.0%, but A Mild and Dji Sam Soe lost 0.6 and 0.3 share
points, respectively, due to low-price competition and temporarily widened price
gaps with competitive brands. Marlboro share grew 0.1 point to 4.1%. In early
July 2007, a kretek version of Marlboro was launched to expand Marlboro's strong
consumer appeal.
In Japan, the total cigarette market was down 16.7 billion units or 20.3% versus
the same quarter last year, reflecting heavy trade purchases in June 2006 ahead
of the July 2006 excise tax increase. PMI's in-market sales were down 20.7% and
overall market share declined 0.1 point to 24.3%. Marlboro share of 9.8% was
unchanged. Cigarette shipment volume was down 8.7% as favorable distributor
inventory movements were more than offset by the lower in-market sales. PMI
estimates that the underlying industry decline after the July 2006 price
increase has been approximately 6%, but anticipates that by the fourth quarter
of this year the market contraction will return to a more normalized 2.5% to
3.0% decline.
In Korea, shipment volume increased 19.1%, due mainly to recent new line
extensions, including Marlboro Filter Plus and Virginia Slims One. Market share
increased 1.3 points to 9.5%, with Marlboro up 0.9 points to 4.2%.
LATIN AMERICA
2007 Second-Quarter Results
In Latin America, cigarette shipment volume of 21.5 billion units was down 2.6%,
due mainly to declines in the Dominican Republic and Mexico, partially offset by
gains in Argentina. Operating companies income decreased 21.5% to $102 million,
primarily as a result of asset impairment and exit costs, and the 2006
divestiture of PMI's interest in the beer business in the Dominican Republic.
In Argentina, the total cigarette market was stable and PMI's shipment volume
increased 2.2%. Market share increased 1.7 points to a record 68.0%, driven by
the strong growth of the Philip Morris brand, which gained 2.0 share points to
31.6%, and Marlboro, which rose 1.9 share points to 21.2%.
In the Dominican Republic, shipment volume declined 35.8%, reflecting a lower
total market following January and February 2007 price increases to partially
compensate for a very significant excise tax increase on cigarettes that was
imposed in January of this year. Market share in the second quarter was 77.6%,
down 0.5 points, as Marlboro declined 2.6 share points to 24.3%, partially
offset by gains for other PMI brands.
In Mexico, the total cigarette market declined 8.5%, due primarily to the timing
of the Easter holiday in March 2007 versus April 2006, as well as tax-driven
price increases and unfavorable inventory movements. However, PMI market share
reached a new record of 64.2%, up 1.4 points on the strength of Marlboro, which
grew 1.0 share point to 47.8%, aided by the national introduction of Marlboro
Wides in May 2007, and continued strong performances of Benson & Hedges and
Delicados. In the second quarter of 2007, PMI shipment volume was down 5.9%, due
to the lower total market.
FINANCIAL SERVICES
2007 Second-Quarter Results
Philip Morris Capital Corporation (PMCC) reported operating companies income of
$139 million for the second quarter of 2007 versus an operating companies loss
of $59 million for the year-earlier period. Second-quarter 2007 results
reflected cash recoveries of $78 million from the sale of bankruptcy claims
related to certain airline leases that had been previously written down and
higher asset management gains versus the prior year, partially offset by lower
lease revenues, primarily as a result of lower investment balances. The
prior-year results reflected a charge of $103 million to the provision for
losses related to the airline industry.
Consistent with its strategic shift in 2003, PMCC is focused on managing its
existing portfolio of finance assets in order to maximize gains and generate
cash flow from asset sales and related activities. PMCC is no longer making new
investments and expects that its operating companies income will fluctuate over
time as investments mature or are sold.
Altria Group, Inc. Profile
As of June 30, 2007, Altria Group, Inc. owned 100% of Philip Morris
International Inc., Philip Morris USA Inc. and Philip Morris Capital
Corporation, and approximately 28.6% of SABMiller plc. The brand portfolio of
Altria Group, Inc.'s tobacco operating companies includes such well-known names
as Marlboro, L&M, Parliament and Virginia Slims. Altria Group, Inc. recorded
2006 net revenues from continuing operations of $67.1 billion.
Trademarks and service marks mentioned in this release are the registered
property of, or licensed by, the subsidiaries of Altria Group, Inc.
Forward-Looking and Cautionary Statements
This press 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. The following important factors could cause
actual results and outcomes to differ materially from those contained in such
forward-looking statements.
Altria Group, Inc.'s tobacco subsidiaries (Philip Morris USA and Philip Morris
International) are subject to intense price competition; changes in consumer
preferences and demand for their products; fluctuations in levels of customer
inventories; the effects of foreign economies and local economic and market
conditions; unfavorable currency movements and changes to income tax laws. Their
results are dependent upon their continued ability to promote brand equity
successfully; to anticipate and respond to new consumer trends; to develop new
products and markets and to broaden brand portfolios in order to compete
effectively with lower-priced products; and to improve productivity.
Altria Group, Inc.'s tobacco subsidiaries continue to be subject to litigation,
including risks associated with adverse jury and judicial determinations, and
courts reaching conclusions at variance with the company's understanding of
applicable law and bonding requirements in the limited number of jurisdictions
that do not limit the dollar amount of appeal bonds; legislation, including
actual and potential excise tax increases; discriminatory excise tax structures;
increasing marketing and regulatory restrictions; the effects of price increases
related to excise tax increases and concluded tobacco litigation settlements on
consumption rates and consumer preferences within price segments; health
concerns relating to the use of tobacco products and exposure to environmental
tobacco smoke; governmental regulation; privately imposed smoking restrictions;
and governmental and grand jury investigations.
Altria Group, Inc. and its subsidiaries are subject to other risks detailed from
time to time in its publicly filed documents, including its Quarterly Report on
Form 10-Q for the period ended March 31, 2007. Altria Group, Inc. 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.
Schedule 1
ALTRIA GROUP, INC.
and Subsidiaries
Condensed Statements of Earnings
For the Quarters Ended June 30,
(in millions, except per share data)
(Unaudited)
2007 2006 % Change
----------------------------
Net revenues $ 18,809 $ 17,150 9.7%
Cost of sales 4,265 3,958 7.8%
Excise taxes on products (*) 9,012 7,895 14.1%
-------------------
Gross profit 5,532 5,297 4.4%
Marketing, administration and research
costs 1,833 1,792
Asset impairment and exit costs 394 21
(Recoveries) Provision for airline
industry exposure (78) 103
-------------------
Operating companies income 3,383 3,381 0.1%
Amortization of intangibles 6 6
General corporate expenses 133 117
Asset impairment and exit costs - 32
-------------------
Operating income 3,244 3,226 0.6%
Interest and other debt expense, net 62 119
-------------------
Earnings from continuing operations
before income taxes, and equity earnings
and minority interest, net 3,182 3,107 2.4%
Provision for income taxes 1,066 1,041 2.4%
-------------------
Earnings from continuing operations
before equity earnings and minority
interest, net 2,116 2,066 2.4%
Equity earnings and minority interest,
net 99 46
-------------------
Earnings from continuing operations 2,215 2,112 4.9%
Earnings from discontinued operations,
net of
income taxes and minority interest - 599
-------------------
Net earnings $ 2,215 $ 2,711 (18.3)%
===================
Per share data:
Basic earnings per share from continuing
operations $ 1.05 $ 1.01 4.0%
Basic earnings per share from
discontinued operations $ - $ 0.29
-------------------
Basic earnings per share $ 1.05 $ 1.30 (19.2)%
===================
Diluted earnings per share from
continuing operations $ 1.05 $ 1.00 5.0%
Diluted earnings per share from
discontinued operations $ - $ 0.29
-------------------
Diluted earnings per share $ 1.05 $ 1.29 (18.6)%
===================
Weighted average number of shares
outstanding - Basic 2,101 2,085 0.8%
- Diluted 2,116 2,102 0.7%
(*) The segment detail of excise taxes on products sold is shown in
the Net Revenues page.
Schedule 2
ALTRIA GROUP, INC.
and Subsidiaries
Selected Financial Data by Business Segment
For the Quarters Ended June 30,
(in millions)
(Unaudited)
Net Revenues
US tobacco European Union EEMA Asia
------------------------------------------------
2007 $ 4,809 $ 6,867 $ 3,103 $ 2,787
2006 4,785 6,064 2,655 2,528
% Change 0.5% 13.2% 16.9% 10.2%
Reconciliation:
For the quarter ended
June 30, 2006 $ 4,785 $ 6,064 $ 2,655 $ 2,528
Divested businesses -
2006 - - - -
Divested businesses -
2007 - - - -
Acquired businesses - - - 90
Currency - 608 107 66
Operations 24 195 341 103
------------------------------------------------
For the quarter ended
June 30, 2007 $ 4,809 $ 6,867 $ 3,103 $ 2,787
================================================
(*) The detail of excise taxes on products sold is as follows:
2007 $ 899 $ 4,568 $ 1,472 $ 1,346
2006 $ 931 $ 4,023 $ 1,180 $ 1,129
2007 Currency
increased
international
tobacco excise taxes $ 405 $ 47 $ 59
Net Revenues
Latin Total International Financial
America tobacco services Total
------------------------------------------------
2007 $ 1,191 $ 13,948 $ 52 $18,809
2006 1,063 12,310 55 17,150
% Change 12.0% 13.3% (5.5)% 9.7%
Reconciliation:
For the quarter ended
June 30, 2006 $ 1,063 $ 12,310 $ 55 $17,150
Divested businesses -
2006 - - - -
Divested businesses -
2007 - - - -
Acquired businesses 34 124 - 124
Currency 5 786 - 786
Operations 89 728 (3) 749
------------------------------------------------
For the quarter ended
June 30, 2007 $ 1,191 $ 13,948 $ 52 $18,809
================================================
(*) The detail of excise taxes on products sold is as follows:
2007 $ 727 $ 8,113 $ 9,012
2006 $ 632 $ 6,964 $ 7,895
2007 Currency
increased
international
tobacco excise taxes $ 1 $ 512
Schedule 3
ALTRIA GROUP, INC.
and Subsidiaries
Selected Financial Data by Business Segment
For the Quarters Ended June 30,
(in millions)
(Unaudited)
Operating Companies
Income
US tobacco European Union EEMA Asia
------------------------------------------------
2007 $1,004 $1,075 $634 $429
2006 1,301 957 564 488
% Change (22.8)% 12.3% 12.4% (12.1)%
Reconciliation:
For the quarter ended
June 30, 2006 $1,301 $957 $564 $488
Divested businesses -
2006 - - - -
Italian antitrust
charge - 2006 - - - -
Asset impairment and
exit costs - 2006 - 20 - 1
Provision for airline
industry exposure -
2006 - - - -
------------------------------------------------
- 20 - 1
------------------------------------------------
Divested businesses -
2007 - - - -
Asset impairment and
exit costs - 2007 (318) (59) - (6)
Recoveries from
airline industry
exposure - 2007 - - - -
------------------------------------------------
(318) (59) - (6)
------------------------------------------------
Acquired businesses - (1) - 8
Currency - 85 21 (22)
Operations 21 73 49 (40)
------------------------------------------------
For the quarter ended
June 30, 2007 $1,004 $1,075 $634 $429
================================================
Operating Companies
Income
Latin Total International Financial Total
America tobacco services
------------------------------------------------
2007 $102 $2,240 $139 $3,383
2006 130 2,139 (59) 3,381
% Change (21.5)% 4.7% +100% 0.1%
Reconciliation:
For the quarter ended
June 30, 2006 $130 $2,139 $(59) $3,381
Divested businesses -
2006 (17) (17) - (17)
Italian antitrust
charge - 2006 - - - -
Asset impairment and
exit costs - 2006 - 21 - 21
Provision for airline
industry exposure -
2006 - - 103 103
------------------------------------------------
(17) 4 103 107
------------------------------------------------
Divested businesses -
2007 - - - -
Asset impairment and
exit costs - 2007 (11) (76) - (394)
Recoveries from
airline industry
exposure - 2007 - - 78 78
------------------------------------------------
(11) (76) 78 (316)
------------------------------------------------
Acquired businesses (9) (2) - (2)
Currency 3 87 - 87
Operations 6 88 17 126
------------------------------------------------
For the quarter ended
June 30, 2007 $102 $2,240 $139 $3,383
================================================
ALTRIA GROUP, INC. Schedule 4
and Subsidiaries
Condensed Statements of Earnings
For the Six Months Ended June 30,
(in millions, except per share data)
(Unaudited)
2007 2006 % Change
-----------------------------
Net revenues $ 36,365 $ 33,382 8.9%
Cost of sales 8,174 7,682 6.4%
Excise taxes on products (*) 17,531 15,441 13.5%
-------------------
Gross profit 10,660 10,259 3.9%
Marketing, administration and research
costs 3,584 3,512
Italian antitrust charge - 61
Asset impairment and exit costs 456 23
(Recoveries) Provision for airline
industry exposure (207) 103
-------------------
Operating companies income 6,827 6,560 4.1%
Amortization of intangibles 12 11
General corporate expenses 260 230
Asset impairment and exit costs 61 32
-------------------
Operating income 6,494 6,287 3.3%
Interest and other debt expense, net 176 266
-------------------
Earnings from continuing operations
before income taxes, equity earnings
and minority interest, net 6,318 6,021 4.9%
Provision for income taxes 2,117 1,415 49.6%
-------------------
Earnings from continuing operations
before equity earnings and minority
interest, net 4,201 4,606 (8.8)%
Equity earnings and minority interest,
net 139 103
-------------------
Earnings from continuing operations 4,340 4,709 (7.8)%
Earnings from discontinued operations,
net of income taxes and minority
interest 625 1,479
-------------------
Net earnings $ 4,965 $ 6,188 (19.8)%
===================
Per share data (**):
Basic earnings per share from continuing
operations $ 2.07 $ 2.26 (8.4)%
Basic earnings per share from
discontinued operations $ 0.30 $ 0.71
-------------------
Basic earnings per share $ 2.37 $ 2.97 (20.2)%
===================
Diluted earnings per share from
continuing operations $ 2.05 $ 2.24 (8.5)%
Diluted earnings per share from
discontinued operations $ 0.30 $ 0.70
-------------------
Diluted earnings per share $ 2.35 $ 2.94 (20.1)%
===================
Weighted average number of
shares outstanding - Basic 2,099 2,083 0.8%
- Diluted 2,113 2,102 0.5%
(*) The segment detail of excise taxes on products sold is shown in
the Net Revenues page.
(**) Basic and diluted earnings per share are computed for each of the
periods presented. Accordingly, the sum of the quarterly earnings per
share amounts may not agree to the year-to-date amounts.
ALTRIA GROUP, INC. Schedule 5
and Subsidiaries
Selected Financial Data by Business Segment
For the Six Months Ended June 30,
(in millions)
(Unaudited)
Net Revenues
US tobacco European Union EEMA Asia
------------------------------------------------
2007 $ 9,054 $ 13,421 $ 5,893 $ 5,537
2006 9,108 11,790 5,109 5,081
% Change (0.6)% 13.8% 15.3% 9.0%
Reconciliation:
For the six months
ended June 30, 2006 $ 9,108 $ 11,790 $ 5,109 $ 5,081
Divested businesses -
2006 - - - -
Divested businesses -
2007 - - - -
Acquired businesses - - - 90
Currency - 1,176 156 185
Operations (54) 455 628 181
------------------------------------------------
For the six months
ended June 30, 2007 $ 9,054 $ 13,421 $ 5,893 $ 5,537
================================================
(*) The detail of excise taxes on products sold is as follows:
2007 $ 1,699 $ 8,957 $ 2,750 $ 2,689
2006 $ 1,786 $ 7,825 $ 2,298 $ 2,252
2007 Currency
increased
(decreased)
international
tobacco excise taxes $ 786 $ 45 $ 137
Net Revenues
Latin Total International Financial
America tobacco services Total
------------------------------------------------
2007 $ 2,365 $ 27,216 $ 95 $36,365
2006 2,131 24,111 163 33,382
% Change 11.0% 12.9% (41.7)% 8.9%
Reconciliation:
For the six months
ended June 30, 2006 $ 2,131 $ 24,111 $ 163 $33,382
Divested businesses -
2006 - - - -
Divested businesses -
2007 - - - -
Acquired businesses 66 156 - 156
Currency (9) 1,508 - 1,508
Operations 177 1,441 (68) 1,319
------------------------------------------------
For the six months
ended June 30, 2007 $ 2,365 $ 27,216 $ 95 $36,365
================================================
(*) The detail of excise taxes on products sold is as follows:
2007 $ 1,436 $ 15,832 $17,531
2006 $ 1,280 $ 13,655 $15,441
2007 Currency
increased
(decreased)
international
tobacco excise taxes $ (8) $ 960
Schedule 6
ALTRIA GROUP, INC.
and Subsidiaries
Selected Financial Data by Business Segment
For the Six Months Ended June 30,
(in millions)
(Unaudited)
Operating Companies
Income
US tobacco European Union EEMA Asia
-------------------------------------------------
2007 $ 2,134 $ 2,105 $ 1,201 $ 898
2006 2,417 1,780 1,057 1,007
% Change (11.7)% 18.3% 13.6% (10.8)%
Reconciliation:
For the six months
ended June 30, 2006 $ 2,417 $ 1,780 $ 1,057 $ 1,007
Divested businesses
- 2006 - - - -
Italian antitrust
charge - 2006 - 61 - -
Asset impairment and
exit costs - 2006 - 22 - 1
Provision for
airline industry
exposure - 2006 - - - -
-------------------------------------------------
- 83 - 1
-------------------------------------------------
Divested businesses
- 2007 - - - -
Asset impairment and
exit costs - 2007 (318) (88) (12) (20)
Recoveries from
airline industry
exposure - 2007 - - - -
-------------------------------------------------
(318) (88) (12) (20)
-------------------------------------------------
Acquired businesses - (1) - 10
Currency - 194 21 (27)
Operations 35 137 135 (73)
-------------------------------------------------
For the six months
ended June 30, 2007 $ 2,134 $ 2,105 $ 1,201 $ 898
=================================================
Operating Companies
Income
Latin Total International Financial
America tobacco services Total
-------------------------------------------------
2007 $ 190 $ 4,394 $ 299 $ 6,827
2006 262 4,106 37 6,560
% Change (27.5)% 7.0% +100% 4.1%
Reconciliation:
For the six months
ended June 30, 2006 $ 262 $ 4,106 $ 37 $ 6,560
Divested businesses
- 2006 (31) (31) - (31)
Italian antitrust
charge - 2006 - 61 - 61
Asset impairment and
exit costs - 2006 - 23 - 23
Provision for
airline industry
exposure - 2006 - - 103 103
-------------------------------------------------
(31) 53 103 156
-------------------------------------------------
Divested businesses
- 2007 - - - -
Asset impairment and
exit costs - 2007 (18) (138) - (456)
Recoveries from
airline industry
exposure - 2007 - - 207 207
-------------------------------------------------
(18) (138) 207 (249)
-------------------------------------------------
Acquired businesses (7) 2 - 2
Currency (5) 183 - 183
Operations (11) 188 (48) 175
-------------------------------------------------
For the six months
ended June 30, 2007 $ 190 $ 4,394 $ 299 $ 6,827
=================================================
Schedule 7
ALTRIA GROUP, INC.
and Subsidiaries
Net Earnings and Diluted Earnings Per Share
For the Quarters Ended June 30,
($ in millions, except per share data)
(Unaudited)
Diluted
Net Earnings E.P.S.
------------ ------------
2007 Continuing Earnings $ 2,215 $ 1.05
2006 Continuing Earnings $ 2,112 $ 1.00
% Change 4.9% 5.0%
Reconciliation:
2006 Continuing Earnings $ 2,112 $ 1.00
2006 Asset impairment and exit costs 36 0.02
2006 Provision for airline industry exposure 66 0.03
------------ ------------
102 0.05
------------ ------------
2007 Asset impairment and exit costs (260) (0.12)
2007 Recoveries from airline industry
exposure 50 0.02
------------ ------------
(210) (0.10)
------------ ------------
Currency 59 0.03
Change in shares - -
Change in tax rate 3 -
Operations 149 0.07
------------ ------------
2007 Continuing Earnings $ 2,215 $ 1.05
2007 Discontinued Earnings $ - $ -
------------ ------------
2007 Net Earnings $ 2,215 $ 1.05
============ ============
2007 Continuing Earnings Excluding Special
Items $ 2,425 $ 1.15
2006 Continuing Earnings Excluding Special
Items $ 2,214 $ 1.05
% Change 9.5% 9.5%
ALTRIA GROUP, INC. Schedule 8
and Subsidiaries
Net Earnings and Diluted Earnings Per Share
For the Six Months Ended June 30,
($ in millions, except per share data)
(Unaudited)
Diluted
Net Earnings E.P.S. (*)
------------ ------------
2007 Continuing Earnings $ 4,340 $ 2.05
2006 Continuing Earnings $ 4,709 $ 2.24
% Change (7.8)% (8.5)%
Reconciliation:
2006 Continuing Earnings $ 4,709 $ 2.24
2006 Italian antitrust charge 61 0.03
2006 Asset impairment and exit costs 37 0.02
2006 Interest on tax reserve transfers to
Kraft 29 0.01
2006 Provision for airline industry
exposure 66 0.03
2006 Tax items (631) (0.30)
------------ ------------
(438) (0.21)
------------ ------------
2007 Asset impairment and exit costs (341) (0.17)
2007 Recoveries from airline industry
exposure 133 0.06
2007 Interest on tax reserve transfers to
Kraft (50) (0.02)
------------ ------------
(258) (0.13)
------------ ------------
Currency 121 0.06
Change in shares - (0.01)
Change in tax rate 13 0.01
Operations 193 0.09
------------ ------------
2007 Continuing Earnings $ 4,340 $ 2.05
2007 Discontinued Earnings $ 625 $ 0.30
------------ ------------
2007 Net Earnings $ 4,965 $ 2.35
============ ============
2007 Continuing Earnings Excluding
Special Items $ 4,598 2.18
2006 Continuing Earnings Excluding
Special Items $ 4,271 2.03
% Change 7.7% 7.4%
(*) Basic and diluted earnings per share are computed for each of the
periods presented. Accordingly, the sum of the quarterly earnings per
share amounts may not agree to the year-to-date amounts.
Schedule 9
ALTRIA GROUP, INC.
and Subsidiaries
Condensed Balance Sheets
(in millions, except ratios)
(Unaudited)
June 30, December 31,
2007 2006
------------ ------------
Assets
Cash and cash equivalents $ 6,156 $ 4,781
All other current assets 12,340 13,724
Property, plant and equipment, net 7,880 7,581
Goodwill 6,794 6,197
Other intangible assets, net 1,938 1,908
Other assets 7,920 6,837
Assets of discontinued operations - 56,452
------------ ------------
Total consumer products assets 43,028 97,480
Total financial services assets 6,467 6,790
------------ ------------
Total assets $ 49,495 $ 104,270
============ ============
Liabilities and Stockholders' Equity
Short-term borrowings $ 483 $ 420
Current portion of long-term debt 3,521 648
Accrued settlement charges 2,408 3,552
All other current liabilities 10,668 10,941
Long-term debt 3,195 6,298
Deferred income taxes 1,679 1,391
Other long-term liabilities 4,671 5,208
Liabilities of discontinued operations - 29,495
------------ ------------
Total consumer products liabilities 26,625 57,953
Total financial services liabilities 6,681 6,698
------------ ------------
Total liabilities 33,306 64,651
Total stockholders' equity 16,189 39,619
------------ ------------
Total liabilities and stockholders' equity $ 49,495 $ 104,270
============ ============
Total consumer products debt $ 7,199 $ 7,366
Debt/equity ratio - consumer products 0.44 0.19
Total debt $ 8,308 $ 8,485
Total debt/equity ratio 0.51 0.21
Schedule 10
ALTRIA GROUP, INC.
and Subsidiaries
Condensed Statement of Earnings
Restated for new Segment Presentation
For the Quarters Ended March 31, June 30, 2007
(in millions)
(Unaudited)
Q1 2007 Q2 2007
Adjusted
---------- ----------
Net Revenues
US Tobacco $ 4,245 $ 4,809
European Union 6,554 6,867
Eastern Europe, Middle East and Africa 2,790 3,103
Asia 2,750 2,787
Latin America 1,174 1,191
---------- ----------
Total International Tobacco 13,268 13,948
Financial Services 43 52
---------- ----------
Total $ 17,556 $ 18,809
========== ==========
Excise taxes on products
US Tobacco $ 800 $ 899
European Union 4,389 4,568
Eastern Europe, Middle East and Africa 1,278 1,472
Asia 1,343 1,346
Latin America 709 727
---------- ----------
Total International Tobacco 7,719 8,113
---------- ----------
Total $ 8,519 $ 9,012
========== ==========
Operating companies income
US Tobacco $ 1,130 $ 1,004
European Union 1,030 1,075
Eastern Europe, Middle East and Africa 567 634
Asia 469 429
Latin America 88 102
---------- ----------
Total International Tobacco 2,154 2,240
Financial Services 160 139
---------- ----------
Total $ 3,444 $ 3,383
========== ==========
Schedule 11
ALTRIA GROUP, INC.
and Subsidiaries
Condensed Statement of Earnings
Restated for new Segment Presentation
For the Quarters Ended March 31, June 30, September 30, December 31,
2006
(in millions)
(Unaudited)
Q1 2006 Q2 2006 Q3 2006 Q4 2006
Adjusted Adjusted Adjusted Adjusted
---------------------------------------
Net Revenues
US Tobacco $ 4,323 $ 4,785 $ 4,830 $ 4,536
European Union 5,726 6,064 6,458 5,504
Eastern Europe, Middle East
and Africa 2,454 2,655 2,607 2,256
Asia 2,553 2,528 2,586 2,475
Latin America 1,068 1,063 1,052 1,211
---------------------------------------
Total International Tobacco 11,801 12,310 12,703 11,446
Financial Services 108 55 109 45
---------------------------------------
Total $ 16,232 $ 17,150 $ 17,642 $ 16,027
=======================================
Excise taxes on products
US Tobacco $ 855 $ 931 $ 938 $ 893
European Union 3,802 4,023 4,324 3,710
Eastern Europe, Middle East
and Africa 1,118 1,180 1,114 953
Asia 1,123 1,129 1,219 1,132
Latin America 648 632 634 725
---------------------------------------
Total International Tobacco 6,691 6,964 7,291 6,520
---------------------------------------
Total $ 7,546 $ 7,895 $ 8,229 $ 7,413
=======================================
Operating companies income
US Tobacco $ 1,116 $ 1,301 $ 1,270 $ 1,125
European Union 823 957 955 781
Eastern Europe, Middle East
and Africa 493 564 582 426
Asia 519 488 449 413
Latin America 132 130 133 613
---------------------------------------
Total International Tobacco 1,967 2,139 2,119 2,233
Financial Services 96 (59) 101 38
---------------------------------------
Total $ 3,179 $ 3,381 $ 3,490 $ 3,396
=======================================
2006 Full
Year
Adjusted
Net Revenues
US Tobacco $ 18,474
European Union 23,752
Eastern Europe, Middle East
and Africa 9,972
Asia 10,142
Latin America 4,394
---------
Total International Tobacco 48,260
Financial Services 317
---------
Total $ 67,051
=========
Excise taxes on products
US Tobacco $ 3,617
European Union 15,859
Eastern Europe, Middle East
and Africa 4,365
Asia 4,603
Latin America 2,639
---------
Total International Tobacco 27,466
---------
Total $ 31,083
=========
Operating companies income
US Tobacco $ 4,812
European Union 3,516
Eastern Europe, Middle East
and Africa 2,065
Asia 1,869
Latin America 1,008
---------
Total International Tobacco 8,458
Financial Services 176
---------
Total $ 13,446
=========
Altria Group, Inc.
Nicholas M. Rolli, 917-663-3460
or
Timothy R. Kellogg, 917-663-2759
Altria Group (LSE:ALA)
과거 데이터 주식 차트
부터 5월(5) 2024 으로 6월(6) 2024
Altria Group (LSE:ALA)
과거 데이터 주식 차트
부터 6월(6) 2023 으로 6월(6) 2024
