Altria Group, Inc. (Altria) (NYSE: MO) today announced its 2013
third-quarter and nine-month business results, and reaffirmed its
guidance for 2013 full-year reported and adjusted diluted EPS.
“During both the quarter and the first nine months, our strategies and
diverse business model continued to produce strong results,” said Marty
Barrington, Chairman and Chief Executive Officer of Altria. “Our
businesses are on-track against their full-year plans, and Altria
remains focused on creating long-term value for shareholders.”
“In addition to producing strong results in our core businesses, we’re
developing innovative tobacco products for adult tobacco consumers,”
said Mr. Barrington. “We’re pleased with Nu Mark’s lead market launch in
Indiana of its MarkTen e-vapor products. Further, Nu Mark plans
to expand distribution of MarkTen to Arizona in December.”
Conference Call
As previously announced, a conference call with the investment community
and news media will be webcast on October 24, 2013 at 9:00 a.m. Eastern
Time. Access to the webcast is available at altria.com.
Cost Management
Altria’s current cost reduction program for its tobacco and service
company subsidiaries remains on-track and is expected to deliver $400
million in annualized savings versus previously planned spending by the
end of 2013.
Cash Returns to Shareholders - Dividends
In August 2013, Altria’s Board of Directors (Board) increased the
regular quarterly dividend by 9.1% to $0.48 per common share versus the
previous rate of $0.44 per common share. The current annualized dividend
rate is $1.92 per common share. As of October 21, 2013, Altria’s
annualized dividend yield was 5.3%.
Altria expects to continue to return a large amount of cash to
shareholders in the form of dividends by maintaining a dividend payout
ratio target of approximately 80% of its adjusted diluted EPS. Future
dividend payments remain subject to the discretion of the Board.
Cash Returns to Shareholders - Share Repurchase
Program
In August 2013, the Board authorized a $700 million expansion of
Altria’s April 2013 share repurchase program from $300 million to $1
billion. During the third quarter of 2013, Altria repurchased
approximately 4.5 million shares of its common stock at an average price
of $34.75 for a total cost of approximately $156 million. As of the end
of the third quarter of 2013, Altria had approximately $709 million
remaining in the expanded program, which it expects to complete by the
end of the third quarter of 2014. The timing of share repurchases
depends upon marketplace conditions and other factors. The program
remains subject to the discretion of the Board.
NPM Arbitration Panel Decision
As previously announced, on September 11, 2013, the arbitration panel
presiding over the non-participating manufacturer adjustment (NPM
Adjustment) dispute for 2003 determined that six of 15 states failed to
diligently enforce laws that require escrow payments from the cigarette
manufacturers that have not signed the Master Settlement Agreement (NPM
Arbitration Panel Decision). As a result of this decision, Philip Morris
USA Inc. (PM USA) expects to receive a credit of approximately $145
million, plus interest, against its 2014 Master Settlement Agreement
payment obligation. PM USA recorded an increase of approximately $145
million in its reported pre-tax earnings for the third quarter of 2013.
2013 Full-Year Guidance
Altria reaffirms its guidance for 2013 full-year reported diluted EPS to
be in a range of $2.57 to $2.62. Altria also reaffirms its guidance for
2013 full-year adjusted diluted EPS, which excludes the special items
shown in Table 1, to be in a range of $2.36 to $2.41, representing a
growth rate of 7% to 9% from an adjusted diluted EPS base of $2.21 in
2012.
The factors described in the Forward-Looking and Cautionary Statements
section of this release represent continuing risks to this forecast.
Reconciliations of full-year adjusted to reported diluted EPS are shown
in Table 1.
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Table 1 - Altria’s Full-Year Earnings Per Share Guidance
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Full Year
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2013 Guidance
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2012
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Change
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Reported diluted EPS
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$
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2.57
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to
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$
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2.62
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$
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2.06
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25
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%
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to
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27
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%
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NPM Adjustment Items 1
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(0.21
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)
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—
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Asset impairment, exit and implementation costs
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—
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0.01
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SABMiller special items
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0.01
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(0.08
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PMCC leveraged lease benefit
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—
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(0.03
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)
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Loss on early extinguishment of debt
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—
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0.28
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Tax items 2
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(0.01
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(0.03
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Adjusted diluted EPS
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$
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2.36
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to
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$
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2.41
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$
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2.21
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7
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%
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to
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9
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%
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1 Reflects the impact of the NPM Adjustment
Settlement ($0.16) and the NPM Arbitration Panel Decision ($0.05).
2 Excludes the tax impact of the Philip Morris
Capital Corporation (PMCC) leveraged lease benefit.
ALTRIA GROUP, INC.
Altria reports its financial results, including diluted EPS, in
accordance with U.S. generally accepted accounting principles (GAAP).
Altria’s management reviews operating companies income (OCI), which
is defined as operating income before corporate expenses and
amortization of intangibles, to evaluate segment performance and
allocate resources. Altria’s management also reviews OCI,
operating margins and EPS on an adjusted basis, which excludes 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, SABMiller plc
(SABMiller) special items, certain PMCC leveraged lease items, certain
tax items, tobacco and health judgments, and settlements of, and
determinations made in, certain NPM Adjustment disputes. Altria’s
management does not view any of these special items to be part of
Altria’s sustainable results as they may be highly variable and
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 effective tax rate on operations may
exclude certain tax items from its reported effective tax rate. Altria’s
management believes that adjusted measures for OCI, operating margins
and EPS, as well as the effective tax rate on operations, provide useful
insight into underlying business trends and results and provide a more
meaningful comparison of year-over-year results. Altria’s
management uses adjusted measures internally 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 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
adjusted measures to corresponding GAAP measures are provided in the
release. Comparisons are to the corresponding prior-year period
unless otherwise stated.
Effective January 1, 2013, Altria’s reportable segments are smokeable
products, manufactured and sold by PM USA and John Middleton Co.
(Middleton); smokeless products, manufactured and sold by or on behalf
of U.S. Smokeless Tobacco Company LLC (USSTC) and PM USA; and wine,
produced and/or distributed by Ste. Michelle Wine Estates Ltd. (Ste.
Michelle). Prior-period segment data have been recast to conform
with the current-period segment presentation.
Altria’s net revenues increased 5.0% to $6.6 billion for the third
quarter primarily due to higher net revenues from the smokeable and
smokeless products segments, and higher gains on asset sales in the
financial services business. For the first nine months, Altria’s net
revenues were essentially unchanged at $18.4 billion, primarily due to
higher net revenues from the smokeless products and wine segments, and
higher gains on asset sales in the financial services business, offset
by lower net revenues in the smokeable products segment. Altria’s
revenues net of excise taxes increased 6.6% to $4.8 billion for the
third quarter and 1.7% to $13.3 billion for the first nine months of
2013.
Altria’s 2013 third-quarter reported diluted EPS increased over 100% to
$0.70 primarily due to the 2012 loss on early extinguishment of debt and
higher reported OCI in the smokeable products segment, including the
impact of the NPM Arbitration Panel Decision. Higher reported OCI in the
smokeless products segment, a lower income tax rate, higher earnings
from Altria’s equity investment in SABMiller and fewer shares
outstanding also contributed to reported diluted EPS growth for the
period. Altria’s third-quarter adjusted diluted EPS, which excludes the
impact of the special items shown in Table 2, grew 12.1% to $0.65
primarily due to higher OCI in the smokeable and smokeless products
segments, a lower income tax rate, higher earnings from Altria’s equity
investment in SABMiller and fewer shares outstanding. The lower income
tax rate reflects the reduction of certain consolidated tax benefits in
2012 resulting from the debt tender offer in the third quarter of 2012.
For the first nine months of 2013, Altria’s reported diluted EPS
increased 33.8% primarily due to the 2012 loss on early extinguishment
of debt and higher reported OCI in the smokeable products segment.
Higher reported OCI in the smokeable products segment was driven
primarily by PM USA’s settlement with certain states of the NPM
Adjustment disputes for 2003-2012 (NPM Adjustment Settlement) and the
NPM Arbitration Panel Decision (the NPM Adjustment Settlement and the
NPM Arbitration Panel Decision are collectively referred to as the NPM
Adjustment Items). Higher reported OCI in the smokeless products
segment, lower interest and other debt expense and fewer shares
outstanding also contributed to reported diluted EPS growth for the
period. These factors were partially offset by lower earnings from
Altria’s equity investment in SABMiller, primarily due to gains from
SABMiller’s strategic alliance transactions in the first quarter of
2012. Altria’s adjusted diluted EPS, which excludes the special items
shown in Table 2, increased 9.0% for the first nine months of 2013
primarily due to higher OCI in the smokeable and smokeless products
segments, a lower income tax rate, lower interest and other debt
expense, higher earnings from Altria’s equity investment in SABMiller
and fewer shares outstanding.
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Table 2 - Altria’s Adjusted Results
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Third Quarter
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Nine Months Ended
September 30,
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2013
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2012
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Change
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2013
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2012
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Change
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Reported diluted EPS
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$
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0.70
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$
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0.32
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100
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%+
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$
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2.02
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$
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1.51
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33.8
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%
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NPM Adjustment Items 1
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(0.05
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)
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—
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(0.21
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)
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—
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Asset impairment, exit and implementation costs
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—
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—
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—
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0.01
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SABMiller special items
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0.01
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0.01
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0.01
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(0.08
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)
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Loss on early extinguishment of debt
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—
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0.28
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—
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0.28
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PMCC leveraged lease benefit
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—
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—
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—
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(0.03
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)
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Tax items 2
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(0.01
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)
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(0.03
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)
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(0.01
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)
|
(0.03
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)
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|
Adjusted diluted EPS
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$
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0.65
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$
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0.58
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12.1
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%
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$
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1.81
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$
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1.66
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9.0
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%
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1 Includes the NPM Arbitration Panel Decision
(third quarter and nine months) and the NPM Adjustment Settlement (nine
months only).
2 Excludes the tax impact of the PMCC leveraged
lease benefit (nine months only).
NPM Adjustment Items
Comparisons of Altria’s third-quarter and nine-month reported diluted
EPS were impacted by the NPM Arbitration Panel Decision discussed above.
As a result of the decision, PM USA recorded a $145 million reduction to
cost of sales for the third quarter of 2013.
The comparison of Altria’s nine-month reported diluted EPS also was
impacted by the NPM Adjustment Settlement. As a result of the
settlement, PM USA recorded a $519 million reduction to cost of sales
for the first nine months. The EPS impact of the NPM Adjustment Items is
shown in Table 2 and Schedules 6 and 7.
SABMiller Special Items
Special items related to Altria’s equity investment in SABMiller
impacted comparisons of Altria’s third-quarter and nine-month reported
diluted EPS. Special items for the third quarter and first nine months
of 2013 included costs related to SABMiller’s “business capability
programme” and its economic and social development program in South
Africa, partially offset by gains related to divestitures. For the first
nine months of 2013, special items also included asset impairment
charges.
Special items for the third quarter of 2012 included costs related to
SABMiller’s “business capability programme” and its acquisition of
Foster’s Group Limited (Foster’s). For the first nine months of 2012,
special items included gains resulting from SABMiller’s strategic
alliance transactions with Anadolu Efes and Castel, partially offset by
costs related to SABMiller’s “business capability programme,” its
acquisition of Foster’s and its economic and social development program
in South Africa. The EPS impact of these special items is shown in Table
2 and Schedules 6 and 7.
2012 Loss on Early Extinguishment of Debt
Comparisons of Altria’s third-quarter and nine-month reported diluted
EPS were impacted by a loss on early extinguishment of debt resulting
from the third-quarter 2012 debt tender offer. Altria recorded a pre-tax
charge of $874 million against 2012 third-quarter earnings, representing
the loss on early extinguishment of debt. This charge is reflected in
Schedules 1 and 3, and the EPS impacts are shown in Table 2 and
Schedules 6 and 7.
2012 Restructuring Charges
The comparison of Altria’s nine-month reported diluted EPS was impacted
by restructuring charges. Altria’s operating companies recorded 2012
nine-month net pre-tax charges totaling $40 million related to the
current cost reduction program. These charges are reflected in Schedule
4, and the EPS impacts are shown in Table 2 and Schedule 7.
2012 PMCC Leveraged Lease Benefit
The comparison of Altria’s nine-month reported diluted EPS was impacted
by a closing agreement (Closing Agreement) that Altria entered into with
the Internal Revenue Service (IRS) in the second quarter of 2012 that
conclusively resolved the federal income tax treatment for all prior and
future tax years of certain leveraged lease transactions entered into by
PMCC. As a result of the Closing Agreement, Altria recorded a one-time
net earnings benefit of $68 million during the second quarter of 2012
due primarily to lower than estimated interest on tax underpayments. The
net benefit was recorded as a decrease of $75 million to the provision
for income taxes and was partially offset by a reduction to cumulative
lease earnings of $7 million against net revenues. The EPS impact of
this one-time benefit is shown in Table 2 and Schedule 7.
Tax Items
Altria’s reported diluted EPS comparisons for the third quarter and
first nine months of 2013 were impacted by tax items. For the third
quarter and first nine months of 2013, Altria recorded tax items
primarily due to the reversal of tax accruals no longer required. For
the third quarter and first nine months of 2012, Altria recorded tax
items primarily related to the reversal of tax reserves and associated
interest following the closure of the 2004-2006 IRS tax audit of Altria
and its consolidated subsidiaries. The 2013 and 2012 tax items are
reflected in Schedules 1 and 3, “Provision for income taxes,” and the
EPS impacts are shown in Table 2 and Schedules 6 and 7.
Altria anticipates that its 2013 full-year effective tax rate on
operations will be approximately 35.7%. A reconciliation between the
reported effective tax rate and the effective tax rate on operations for
the third quarter and first nine months of 2013 is shown in the table
below.
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Table 3 - Altria’s 2013 Tax Rates
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Third Quarter
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Nine Months Ended
September 30
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Reported effective tax rate 1
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34.1%
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35.0%
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Tax benefit from Mondelēz tax matters 2
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0.7
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0.3
|
|
Other tax benefits primarily due to the reversal of tax accruals
no longer required
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1.2
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0.4
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Effective tax rate on operations
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36.0%
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35.7%
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1 Reported effective tax rate is calculated as
“Provision for income taxes” divided by “Earnings before income taxes”
from Schedules 1 and 3.
2 This tax benefit is fully offset by changes to a
corresponding payable to Mondelēz International, Inc. (Mondelēz), which
is reflected in Schedules 1 and 3. Due to this offset, Mondelēz
tax matters had no impact on Altria’s net earnings and reported and
adjusted diluted EPS for the third quarter and first nine months of 2013.
SMOKEABLE PRODUCTS
The smokeable products segment grew adjusted OCI for the third quarter
and first nine months of 2013 primarily through higher pricing. PM USA
grew its total cigarette retail share versus both prior-year periods.
For the third quarter of 2013, the smokeable products segment’s net
revenues increased 3.4% primarily due to higher pricing and higher
reported shipment volume, partially offset by higher promotional
investments. For the first nine months of 2013, the smokeable products
segment’s net revenues decreased 1.0% primarily due to lower reported
shipment volume, partially offset by higher pricing. Revenues net of
excise taxes for the third quarter and first nine months of 2013
increased 4.6% and 0.5%, respectively.
The smokeable products segment’s 2013 third-quarter reported OCI
increased 11.5% primarily due to higher pricing, the NPM Arbitration
Panel Decision and higher reported shipment volume. These factors were
partially offset by higher promotional investments, higher resolution
expense and higher selling, general and administrative expenses due to
the timing of spending. For the first nine months of 2013, the smokeable
products segment’s reported OCI increased 16.0% primarily due to the NPM
Adjustment Items and higher pricing. These factors were partially offset
by lower reported shipment volume and higher resolution expense.
Adjusted OCI, which is calculated excluding the special items identified
in Table 4, grew 3.1% for the third quarter and 2.0% for first nine
months of 2013.
Adjusted OCI margin for the smokeable products segment decreased 0.6
percentage points to 41.8% for the third quarter of 2013 and increased
0.6 percentage points to 42.2% for the first nine months of 2013.
Revenues and OCI for the smokeable products segment are summarized in
Table 4.
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Table 4 - Smokeable Products: Revenues and OCI ($ in millions)
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Third Quarter
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Nine Months Ended
September 30,
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2013
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|
2012
|
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Change
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2013
|
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2012
|
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|
Change
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|
Net revenues
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|
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$
|
|
|
5,802
|
|
|
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$
|
|
|
5,613
|
|
|
|
3.4
|
%
|
|
|
|
$
|
|
|
16,448
|
|
|
|
$
|
|
|
16,616
|
|
|
|
(1.0
|
)%
|
|
Excise taxes
|
|
|
|
(1,751
|
)
|
|
|
(1,742
|
)
|
|
|
|
|
|
|
(5,016
|
)
|
|
|
(5,239
|
)
|
|
|
|
|
Revenues net of excise taxes
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|
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|
$
|
|
|
4,051
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|
$
|
|
|
3,871
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|
|
|
4.6
|
%
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|
|
|
$
|
|
|
11,432
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|
|
|
$
|
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|
11,377
|
|
|
|
0.5
|
%
|
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|
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|
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Reported OCI
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|
|
|
$
|
|
|
1,825
|
|
|
|
$
|
|
|
1,637
|
|
|
|
11.5
|
%
|
|
|
|
$
|
|
|
5,471
|
|
|
|
$
|
|
|
4,716
|
|
|
|
16.0
|
%
|
|
NPM Adjustment Items 1
|
|
|
|
(145
|
)
|
|
|
—
|
|
|
|
|
|
|
|
(664
|
)
|
|
|
—
|
|
|
|
|
|
Asset impairment, exit and
implementation costs, net
|
|
|
|
—
|
|
|
|
2
|
|
|
|
|
|
|
|
2
|
|
|
|
13
|
|
|
|
|
|
Tobacco and health judgments
|
|
|
|
13
|
|
|
|
3
|
|
|
|
|
|
|
|
18
|
|
|
|
4
|
|
|
|
|
|
Adjusted OCI
|
|
|
|
$
|
|
|
1,693
|
|
|
|
$
|
|
|
1,642
|
|
|
|
3.1
|
%
|
|
|
|
$
|
|
|
4,827
|
|
|
|
$
|
|
|
4,733
|
|
|
|
2.0
|
%
|
|
Adjusted OCI margins 2
|
|
|
|
41.8
|
%
|
|
|
42.4
|
%
|
|
|
(0.6) pp
|
|
|
|
42.2
|
%
|
|
|
41.6
|
%
|
|
|
0.6 pp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Includes the NPM Arbitration Panel Decision
(third quarter and nine months) and the NPM Adjustment Settlement (nine
months only).
2 Adjusted OCI margins are calculated as adjusted
OCI divided by revenues net of excise taxes.
PM USA’s 2013 third-quarter reported domestic cigarettes shipment volume
increased 1.2% primarily due to one extra shipping day, changes in trade
inventories and retail share gains, partially offset by the industry’s
rate of decline. After adjusting for calendar differences and changes in
trade inventories, PM USA estimates that its third-quarter 2013 domestic
cigarettes shipment volume was down approximately 3% and that total
cigarette category volume declined approximately 3.5% in the same
period. PM USA’s cigarette volume performance for the third quarter of
2013 is summarized in Table 5.
PM USA’s 2013 nine-month reported domestic cigarettes shipment volume
decreased 3.6% primarily due to the industry’s rate of decline and
changes in trade inventories, partially offset by retail share gains.
After adjusting for changes in trade inventories, PM USA estimates that
its 2013 nine-month domestic cigarettes shipment volume was down
approximately 4%, in line with the estimated decline rate for total
cigarette category volume for the same period. PM USA’s cigarette volume
performance for the first nine months of 2013 is summarized in Table 5.
Middleton’s 2013 third-quarter reported cigars shipment volume increased
6.0%. For the first nine months of 2013, Middleton’s reported shipment
volume decreased 6.6% primarily due to changes in wholesale inventories
and retail share losses. Middleton’s volume performance for machine-made
large cigars is summarized in Table 5.
|
|
|
Table 5 - Smokeable Products: Shipment Volume (sticks in millions)
|
|
|
|
|
|
|
|
|
|
|
Third Quarter
|
|
|
Nine Months Ended
September 30,
|
|
|
|
|
2013
|
|
2012
|
|
Change
|
|
2013
|
|
2012
|
|
Change
|
|
Cigarettes:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marlboro
|
|
|
29,399
|
|
|
28,954
|
|
|
1.5
|
%
|
|
|
83,953
|
|
|
87,248
|
|
|
(3.8
|
)%
|
|
Other premium
|
|
|
2,016
|
|
|
2,177
|
|
|
(7.4
|
)%
|
|
|
5,838
|
|
|
6,503
|
|
|
(10.2
|
)%
|
|
Discount
|
|
|
2,702
|
|
|
2,571
|
|
|
5.1
|
%
|
|
|
7,646
|
|
|
7,290
|
|
|
4.9
|
%
|
|
Total cigarettes
|
|
|
34,117
|
|
|
33,702
|
|
|
1.2
|
%
|
|
|
97,437
|
|
|
101,041
|
|
|
(3.6
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cigars:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Black & Mild
|
|
|
311
|
|
|
298
|
|
|
4.4
|
%
|
|
|
874
|
|
|
940
|
|
|
(7.0
|
)%
|
|
Other
|
|
|
9
|
|
|
4
|
|
|
100
|
%+
|
|
|
17
|
|
|
14
|
|
|
21.4
|
%
|
|
Total cigars
|
|
|
320
|
|
|
302
|
|
|
6.0
|
%
|
|
|
891
|
|
|
954
|
|
|
(6.6
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total smokeable products
|
|
|
34,437
|
|
|
34,004
|
|
|
1.3
|
%
|
|
|
98,328
|
|
|
101,995
|
|
|
(3.6
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Cigarettes volume includes units sold as well as
promotional units, but excludes units sold in Puerto Rico and U.S.
Territories, to Overseas Military and by Philip Morris Duty Free Inc.,
none of which, individually or in aggregate, is material to the
smokeable products segment.
Marlboro’s retail share for the third quarter and first nine
months of 2013 was unchanged versus both prior-year periods. Later this
month, PM USA will expand Marlboro Edge distribution nationally. Marlboro
Edge, part of the Marlboro Black family, offers adult smokers
bold, smooth flavor.
PM USA’s total retail share for the third quarter and first nine months
of 2013 increased 0.2 and 0.3 share points, respectively, due to retail
share gains by L&M in Discount, partially offset by share
losses on other portfolio brands. PM USA’s cigarette retail share
performance is summarized in Table 6.
In the machine-made large cigars category, Black & Mild’s
retail share for the third quarter and first nine months of 2013
decreased 1.1 and 1.6 share points, respectively. Middleton’s retail
share performance is summarized in Table 6.
|
|
|
Table 6 - Smokeable Products: Retail Share (percent)
|
|
|
|
|
|
|
|
Third Quarter
|
|
|
|
Nine Months Ended
September 30,
|
|
|
|
2013
|
|
2012
|
|
Percentage
point
change
|
|
|
|
2013
|
|
2012
|
|
Percentage
point
change
|
|
Cigarettes:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marlboro
|
|
43.7
|
%
|
|
43.7
|
%
|
|
—
|
|
|
|
43.6
|
%
|
|
43.6
|
%
|
|
—
|
|
Other premium
|
|
3.1
|
|
|
3.2
|
|
|
(0.1)
|
|
|
|
3.1
|
|
|
3.3
|
|
|
(0.2)
|
|
Discount
|
|
3.9
|
|
|
3.6
|
|
|
0.3
|
|
|
|
3.9
|
|
|
3.4
|
|
|
0.5
|
|
Total cigarettes
|
|
50.7
|
%
|
|
50.5
|
%
|
|
0.2
|
|
|
|
50.6
|
%
|
|
50.3
|
%
|
|
0.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cigars:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Black & Mild
|
|
29.5
|
%
|
|
30.6
|
%
|
|
(1.1)
|
|
|
|
29.2
|
%
|
|
30.8
|
%
|
|
(1.6)
|
|
Other
|
|
0.2
|
|
|
0.2
|
|
|
—
|
|
|
|
0.2
|
|
|
0.2
|
|
|
—
|
|
Total cigars
|
|
29.7
|
%
|
|
30.8
|
%
|
|
(1.1)
|
|
|
|
29.4
|
%
|
|
31.0
|
%
|
|
(1.6)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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. Retail share results for cigars are based on data from
IRI InfoScan, a tracking service that uses a sample of stores to project
market share and depict share trends. Both services track sales
in the Food, Drug and Mass Merchandisers (including Wal-Mart),
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). These services
are not designed to capture sales through other channels, including the
internet, direct mail and some illicitly tax-advantaged outlets. Retail
share results for cigars are based on data for machine-made large cigars.
Middleton defines machine-made large cigars as cigars, made by
machine, that weigh greater than three pounds per thousand, except
cigars sold at retail in packages of 20 cigars. Because the
cigars 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 services, which could restate retail share results that were
previously released in these services.
SMOKELESS PRODUCTS
The smokeless products segment grew its adjusted OCI for the third
quarter and first nine months of 2013 primarily through higher pricing
and higher volume. USSTC grew Copenhagen and Skoal’s combined
volume and retail share in both periods.
The smokeless products segment’s 2013 third-quarter net revenues
increased 11.0% primarily due to higher volume and higher pricing,
partially offset by higher promotional investments. For the first nine
months, the segment’s net revenues increased 7.2% primarily due to
higher volume and higher pricing, partially offset by higher promotional
investments and unfavorable mix due to growth in products introduced in
recent years at a lower, popular price. For the third quarter and first
nine months of 2013, the smokeless products segment’s revenues net of
excise taxes increased 9.8% and 6.6%, respectively.
The smokeless products segment’s reported OCI for the third quarter
increased 12.6% primarily due to higher volume, higher pricing and 2012
restructuring charges related to the current cost reduction program.
These factors were partially offset by higher promotional investments
and higher selling, general and administrative expenses. For the first
nine months, the segment’s reported OCI increased 13.4% primarily due to
higher pricing, higher volume and 2012 restructuring charges related to
the current cost reduction program. These factors were partially offset
by higher promotional investments and unfavorable mix. Adjusted OCI for
the smokeless products segment, which is calculated excluding the
special items identified in Table 7, grew 9.1% for both the third
quarter and first nine months of 2013. Adjusted OCI margin for the
smokeless products segment decreased 0.5 percentage points to 61.8% for
the third quarter of 2013 and increased 1.4 percentage points to 62.2%
for the first nine months of 2013. Revenues and OCI for the smokeless
products segment are summarized in Table 7.
|
|
|
Table 7 - Smokeless Products: Revenues and OCI ($ in millions)
|
|
|
|
|
|
|
|
Third Quarter
|
|
|
|
Nine Months Ended
September 30,
|
|
|
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
Net revenues
|
|
|
$
|
|
|
485
|
|
|
|
$
|
|
|
437
|
|
|
|
11.0
|
%
|
|
|
|
$
|
|
|
1,333
|
|
|
|
$
|
|
|
1,243
|
|
|
|
7.2
|
%
|
|
Excise taxes
|
|
|
(37
|
)
|
|
|
(29
|
)
|
|
|
|
|
|
|
(96
|
)
|
|
|
(83
|
)
|
|
|
|
|
Revenues net of excise taxes
|
|
|
$
|
|
|
448
|
|
|
|
$
|
|
|
408
|
|
|
|
9.8
|
%
|
|
|
|
$
|
|
|
1,237
|
|
|
|
$
|
|
|
1,160
|
|
|
|
6.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported OCI
|
|
|
$
|
|
|
277
|
|
|
|
$
|
|
|
246
|
|
|
|
12.6
|
%
|
|
|
|
$
|
|
|
769
|
|
|
|
$
|
|
|
678
|
|
|
|
13.4
|
%
|
|
Asset impairment, exit and implementation costs, net
|
|
|
—
|
|
|
|
8
|
|
|
|
|
|
|
|
—
|
|
|
|
27
|
|
|
|
|
|
Adjusted OCI
|
|
|
$
|
|
|
277
|
|
|
|
$
|
|
|
254
|
|
|
|
9.1
|
%
|
|
|
|
$
|
|
|
769
|
|
|
|
$
|
|
|
705
|
|
|
|
9.1
|
%
|
|
Adjusted OCI margins 1
|
|
|
61.8
|
%
|
|
|
62.3
|
%
|
|
|
(0.5
|
) pp
|
|
|
|
62.2
|
%
|
|
|
60.8
|
%
|
|
|
1.4 pp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Adjusted OCI margins are calculated as adjusted
OCI divided by revenues net of excise taxes.
For the third quarter of 2013, USSTC and PM USA’s combined reported
domestic smokeless products shipment volume increased 9.5% primarily due
to one extra shipping day and volume growth for Copenhagen and
Skoal. For the first nine months of 2013, USSTC and PM USA’s
combined reported domestic smokeless products shipment volume increased
6.0% due to volume growth for Copenhagen and Skoal, partially
offset by declines for Other portfolio brands.
Copenhagen and Skoal’s combined reported shipment volume
increased 10.5% for the third quarter and 7.2% for the first nine months
of 2013. Copenhagen’s volume grew 15.4% for the third quarter and
11.1% for the first nine months of 2013, as the brand continued to
benefit from products introduced in recent years. Skoal’s volume
increased 3.7% for the third quarter and 1.8% for the first nine months
of 2013.
After adjusting for an extra shipping day, trade inventory changes and
other factors, USSTC and PM USA estimate that their combined domestic
smokeless products shipment volume grew approximately 4% for the third
quarter of 2013. After adjusting for trade inventory changes and other
factors, USSTC and PM USA estimate that their combined domestic
smokeless products shipment volume grew approximately 5% for the first
nine months of 2013, in line with estimated volume growth for the
smokeless products category over the 12 months ending September 30, 2013.
USSTC and PM USA’s combined volume performance for smokeless products is
summarized in Table 8.
|
|
|
Table 8 - Smokeless Products: Shipment Volume (cans and packs in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Third Quarter
|
|
|
|
|
Nine Months Ended
September 30,
|
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Copenhagen
|
|
116.4
|
|
|
|
100.9
|
|
|
|
15.4
|
%
|
|
|
|
316.6
|
|
|
|
284.9
|
|
|
|
11.1
|
%
|
|
Skoal
|
|
75.6
|
|
|
|
72.9
|
|
|
|
3.7
|
%
|
|
|
|
213.8
|
|
|
|
210.0
|
|
|
|
1.8
|
%
|
|
Copenhagen and Skoal
|
|
192.0
|
|
|
|
173.8
|
|
|
|
10.5
|
%
|
|
|
|
530.4
|
|
|
|
494.9
|
|
|
|
7.2
|
%
|
|
Other
|
|
20.8
|
|
|
|
20.5
|
|
|
|
1.5
|
%
|
|
|
|
58.6
|
|
|
|
61.0
|
|
|
|
(3.9
|
)%
|
|
Total smokeless products
|
|
212.8
|
|
|
|
194.3
|
|
|
|
9.5
|
%
|
|
|
|
589.0
|
|
|
|
555.9
|
|
|
|
6.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Other includes certain USSTC and PM USA smokeless
products. Volume includes cans and packs sold, as well as
promotional units, but excludes international volume, which is not
material to the smokeless products segment. New types of
smokeless products, as well as new packaging configurations of existing
smokeless products, may or may not be equivalent to existing moist
smokeless tobacco (MST) products on a can for can basis. To
calculate volumes of cans and packs shipped, USSTC and PM USA have
assumed that one pack of snus, irrespective of the number of pouches in
the pack, is equivalent to one can of MST.
For the third quarter and first nine months of 2013, Copenhagen
and Skoal’s combined retail share increased 0.1 and 0.4 share
points, respectively. Copenhagen’s retail share grew 1.3 share
points for the third quarter of 2013 and 1.4 share points for the first
nine months of 2013, as the brand continued to benefit from products
introduced over the past several years. Skoal’s 2013
third-quarter and nine-months retail share declined 1.2 and 1.0 share
points, respectively, primarily due to competitive activity and Copenhagen’s
strong performance.
USSTC and PM USA’s combined retail share for the third quarter and first
nine months of 2013 decreased 0.3 and 0.2 share points, respectively, as
retail share losses for Skoal and Other portfolio brands were
mostly offset by retail share gains for Copenhagen. USSTC and PM
USA’s combined smokeless products retail share performance is summarized
in Table 9.
|
|
|
Table 9 - Smokeless Products: Retail Share (percent)
|
|
|
|
|
|
|
Third Quarter
|
|
|
|
Nine Months Ended
September 30,
|
|
|
|
|
2013
|
|
|
2012
|
|
Percentage
point
change
|
|
|
|
2013
|
|
|
2012
|
|
Percentage
point
change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Copenhagen
|
|
|
29.6
|
%
|
|
|
28.3
|
%
|
|
1.3
|
|
|
|
29.1
|
%
|
|
|
27.7
|
%
|
|
1.4
|
|
Skoal
|
|
|
21.2
|
|
|
|
22.4
|
|
|
(1.2)
|
|
|
|
21.6
|
|
|
|
22.6
|
|
|
(1.0)
|
|
Copenhagen and Skoal
|
|
|
50.8
|
|
|
|
50.7
|
|
|
0.1
|
|
|
|
50.7
|
|
|
|
50.3
|
|
|
0.4
|
|
Other
|
|
|
4.3
|
|
|
|
4.7
|
|
|
(0.4)
|
|
|
|
4.3
|
|
|
|
4.9
|
|
|
(0.6)
|
|
Total smokeless products
|
|
|
55.1
|
%
|
|
|
55.4
|
%
|
|
(0.3)
|
|
|
|
55.0
|
%
|
|
|
55.2
|
%
|
|
(0.2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Retail share results for smokeless 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. The service tracks
sales in the Food, Drug and Mass Merchandisers (including Wal-Mart),
Convenience, Military, Dollar Store and Club trade classes on the number
of cans and packs sold. Smokeless products is defined by IRI as
moist smokeless and spit-free tobacco products. Other includes
certain USSTC and PM USA smokeless products. New types of
smokeless products, as well as new packaging configuration of existing
smokeless products, may or may not be equivalent to existing MST
products on a can for can basis. USSTC and PM USA have assumed
that one pack of snus, irrespective of the number of pouches in the
pack, is equivalent to one can of MST. All other products are
considered to be equivalent on a can for can basis. 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
Ste. Michelle delivered solid OCI growth for the third-quarter of 2013
and excellent OCI growth for the first nine months of 2013.
Ste. Michelle grew net revenues for the third quarter of 2013 by 5.7%
due to improved premium mix and higher pricing, partially offset by
lower shipment volume. For the first nine months of 2013, Ste. Michelle
grew net revenues by 7.9% due to higher shipment volume, improved
premium mix and higher pricing. Revenues net of excise taxes grew 5.9%
for the third quarter and 7.9% for the first nine months of 2013.
Ste. Michelle increased OCI for the third quarter of 2013 by 7.7% due to
improved premium mix and higher pricing, partially offset by higher
selling, general and administrative expenses and lower shipment volume.
For the first nine months of 2013, Ste. Michelle grew OCI by 15.9% due
to higher shipment volume, improved premium mix and higher pricing,
partially offset by higher selling, general and administrative expenses.
Ste. Michelle expanded OCI margins by 0.3 percentage points for the
third quarter and 1.2 percentage points for the first nine months of
2013. Revenues and OCI for the wine segment are summarized in Table 10.
|
|
|
Table 10 - Wine: Revenues and OCI ($ in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Third Quarter
|
|
|
|
|
Nine Months Ended
September 30,
|
|
|
|
|
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
Net revenues
|
|
|
|
|
$
|
|
|
148
|
|
|
|
$
|
|
|
140
|
|
|
|
5.7
|
%
|
|
|
|
$
|
411
|
|
|
|
$
|
381
|
|
|
|
7.9
|
%
|
|
Excise taxes
|
|
|
|
|
(5
|
)
|
|
|
(5
|
)
|
|
|
|
|
|
|
(15
|
)
|
|
|
(14
|
)
|
|
|
|
|
Revenues net of excise taxes
|
|
|
|
|
$
|
|
|
143
|
|
|
|
$
|
|
|
135
|
|
|
|
5.9
|
%
|
|
|
|
$
|
396
|
|
|
|
$
|
367
|
|
|
|
7.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported and Adjusted OCI
|
|
|
|
|
$
|
|
|
28
|
|
|
|
$
|
|
|
26
|
|
|
|
7.7
|
%
|
|
|
|
$
|
73
|
|
|
|
$
|
63
|
|
|
|
15.9
|
%
|
|
Reported and Adjusted OCI margins 1
|
|
|
|
|
19.6
|
%
|
|
|
19.3
|
%
|
|
|
0.3 pp
|
|
|
|
18.4
|
%
|
|
|
17.2
|
%
|
|
|
1.2 pp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Adjusted OCI margins are calculated as adjusted
OCI divided by revenues net of excise taxes.
Ste. Michelle’s 2013 third-quarter reported wine shipment volume
decreased 2.0% primarily due to changes in trade inventories. For the
first nine months of 2013, Ste. Michelle’s reported wine shipment volume
increased 4.7% primarily due to increased distribution of 14 Hands.
Ste. Michelle’s reported shipment volume performance for wine is
summarized in Table 11.
|
|
|
Table 11 - Wine: Shipment Volume (cases in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Third Quarter
|
|
|
|
|
Nine Months Ended
September 30,
|
|
|
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
|
|
2013
|
|
|
2012
|
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chateau Ste. Michelle
|
|
|
|
680
|
|
|
|
704
|
|
|
|
(3.4
|
)%
|
|
|
|
1,864
|
|
|
|
1,860
|
|
|
|
0.2
|
%
|
|
Columbia Crest
|
|
|
|
404
|
|
|
|
440
|
|
|
|
(8.2
|
)%
|
|
|
|
1,202
|
|
|
|
1,193
|
|
|
|
0.8
|
%
|
|
14 Hands
|
|
|
|
296
|
|
|
|
270
|
|
|
|
9.6
|
%
|
|
|
|
949
|
|
|
|
710
|
|
|
|
33.7
|
%
|
|
Other
|
|
|
|
492
|
|
|
|
496
|
|
|
|
(0.8
|
)%
|
|
|
|
1,393
|
|
|
|
1,403
|
|
|
|
(0.7
|
)%
|
|
Total Wine
|
|
|
|
1,872
|
|
|
|
1,910
|
|
|
|
(2.0
|
)%
|
|
|
|
5,408
|
|
|
|
5,166
|
|
|
|
4.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Altria’s Profile
Altria directly or indirectly owns 100% of each of PM USA, USSTC,
Middleton, Nu Mark LLC (Nu Mark), Ste. Michelle and PMCC. Altria holds a
continuing economic and voting interest in SABMiller.
The brand portfolios of Altria’s tobacco operating companies include Marlboro®,
Black & Mild®, Copenhagen®,
Skoal® and MarkTen™.
Ste. Michelle produces and markets premium wines sold under various
labels, including Chateau Ste. Michelle®, Columbia
Crest®, 14 Hands® and
Stag’s Leap Wine Cellars®, and it imports and
markets Antinori®, Champagne Nicolas
Feuillatte™ and Villa Maria Estate™
products in the United States. Trademarks and service marks related to
Altria referenced in this release are the property of Altria or its
subsidiaries or are used with permission. More information about Altria
is available at altria.com.
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.
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 press release are described in Altria’s
publicly filed reports, including its Annual Report on Form 10-K for the
year ended December 31, 2012 and its Quarterly Report on Form 10-Q for
the period ended June 30, 2013.
These factors include the following: Altria’s tobacco businesses
(including PM USA, USSTC, Middleton and Nu Mark) being subject to
significant competition; changes in adult tobacco consumer preferences
and demand for their products; fluctuations in raw material
availability, quality and price; reliance on key facilities and
suppliers; reliance on critical information systems, many of which are
managed by third-party service providers; fluctuations in levels of
customer inventories; the effects of global, national and local economic
and market conditions; changes to income tax laws; federal, state and
local legislative activity, including actual and potential federal and
state excise tax increases; increasing marketing and regulatory
restrictions; the effects of price increases related to excise tax
increases and concluded tobacco litigation settlements on trade
inventories, consumption rates and consumer preferences within price
segments; health concerns relating to the use of tobacco products and
exposure to environmental tobacco smoke; privately imposed smoking
restrictions; and, from time to time, governmental investigations.
Furthermore, the results of Altria’s tobacco businesses are dependent
upon their continued ability to promote brand equity successfully; to
anticipate and respond to evolving adult consumer preferences; to
develop, manufacture, market and distribute products that appeal to
adult tobacco consumers (including, where appropriate, through
arrangements with third parties); to improve productivity; and to
protect or enhance margins through cost savings and price increases.
Altria and its tobacco businesses are also subject to federal, state and
local government regulation, including broad-based regulation of PM USA
and USSTC by the U.S. Food and Drug Administration (FDA). Altria and its
subsidiaries continue to be subject to litigation, including risks
associated with adverse jury and judicial determinations, courts
reaching conclusions at variance with the companies’ understanding of
applicable law, bonding requirements in the limited number of
jurisdictions that do not limit the dollar amount of appeal bonds and
certain challenges to bond cap statutes.
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
For the Quarters Ended September 30,
(dollars
in millions, except per share data)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues
|
|
$
|
|
|
6,553
|
|
|
|
|
$
|
|
|
6,242
|
|
|
|
|
5.0
|
%
|
|
Cost of sales 1
|
|
1,939
|
|
|
|
|
1,982
|
|
|
|
|
|
|
Excise taxes on products 1
|
|
1,793
|
|
|
|
|
1,776
|
|
|
|
|
|
|
Gross profit
|
|
2,821
|
|
|
|
|
2,484
|
|
|
|
|
13.6
|
%
|
|
Marketing, administration and research costs
|
|
599
|
|
|
|
|
487
|
|
|
|
|
|
|
Asset impairment and exit costs
|
|
—
|
|
|
|
|
9
|
|
|
|
|
|
|
Operating companies income
|
|
2,222
|
|
|
|
|
1,988
|
|
|
|
|
11.8
|
%
|
|
Amortization of intangibles
|
|
5
|
|
|
|
|
5
|
|
|
|
|
|
|
General corporate expenses
|
|
60
|
|
|
|
|
61
|
|
|
|
|
|
|
Changes to Mondelēz and PMI tax-related receivables/payables
|
|
25
|
|
|
|
|
(48
|
)
|
|
|
|
|
|
Corporate asset impairment and exit costs
|
|
—
|
|
|
|
|
1
|
|
|
|
|
|
|
Operating income
|
|
2,132
|
|
|
|
|
1,969
|
|
|
|
|
8.3
|
%
|
|
Interest and other debt expense, net
|
|
269
|
|
|
|
|
282
|
|
|
|
|
|
|
Loss on early extinguishment of debt
|
|
—
|
|
|
|
|
874
|
|
|
|
|
|
|
Earnings from equity investment in SABMiller
|
|
(255
|
)
|
|
|
|
(230
|
)
|
|
|
|
|
|
Earnings before income taxes
|
|
2,118
|
|
|
|
|
1,043
|
|
|
|
|
100%+
|
|
Provision for income taxes
|
|
722
|
|
|
|
|
386
|
|
|
|
|
|
|
Net earnings
|
|
1,396
|
|
|
|
|
657
|
|
|
|
|
100%+
|
|
Net earnings attributable to noncontrolling interests
|
|
—
|
|
|
|
|
—
|
|
|
|
|
|
|
Net earnings attributable to Altria Group, Inc.
|
|
$
|
|
|
1,396
|
|
|
|
|
$
|
|
|
657
|
|
|
|
|
100%+
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per share data:
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted earnings per share attributable to
Altria Group, Inc.
|
|
$
|
|
|
0.70
|
|
|
|
|
$
|
|
|
0.32
|
|
|
|
|
100%+
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average diluted shares outstanding
|
|
1,998
|
|
|
|
|
2,024
|
|
|
|
|
(1.3
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Cost of sales includes charges for resolution expenses
related to state settlement and other tobacco agreements, and FDA user
fees. Supplemental information concerning those items and excise taxes
on products sold is shown in Schedule 5.
|
Schedule 2
|
ALTRIA GROUP, INC.
and Subsidiaries
Selected Financial
Data by Segment
For the Quarters Ended September 30,
(dollars
in millions)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenues 1
|
|
|
|
Smokeable
Products
|
|
|
Smokeless
Products
|
|
|
Wine
|
|
|
All Other
|
|
|
Total
|
|
2013
|
|
$
|
|
|
5,802
|
|
|
|
$
|
|
|
485
|
|
|
|
$
|
|
|
148
|
|
|
|
$
|
|
|
118
|
|
|
|
$
|
|
|
6,553
|
|
|
2012
|
|
5,613
|
|
|
|
437
|
|
|
|
140
|
|
|
|
52
|
|
|
|
6,242
|
|
|
% Change
|
|
3.4
|
%
|
|
|
11.0
|
%
|
|
|
5.7
|
%
|
|
|
100
|
%+
|
|
|
5.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the quarter ended September 30, 2012
|
|
$
|
|
|
5,613
|
|
|
|
$
|
|
|
437
|
|
|
|
$
|
|
|
140
|
|
|
|
$
|
|
|
52
|
|
|
|
$
|
|
|
6,242
|
|
|
Operations
|
|
189
|
|
|
|
48
|
|
|
|
8
|
|
|
|
66
|
|
|
|
311
|
|
|
For the quarter ended September 30, 2013
|
|
$
|
|
|
5,802
|
|
|
|
$
|
|
|
485
|
|
|
|
$
|
|
|
148
|
|
|
|
$
|
|
|
118
|
|
|
|
$
|
|
|
6,553
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Companies Income 1
|
|
|
|
Smokeable
Products
|
|
|
Smokeless
Products
|
|
|
Wine
|
|
|
All Other
|
|
|
Total
|
|
2013
|
|
$
|
|
|
1,825
|
|
|
|
$
|
|
|
277
|
|
|
|
$
|
|
|
28
|
|
|
|
$
|
|
|
92
|
|
|
|
$
|
|
|
2,222
|
|
|
2012
|
|
1,637
|
|
|
|
246
|
|
|
|
26
|
|
|
|
79
|
|
|
|
1,988
|
|
|
% Change
|
|
11.5
|
%
|
|
|
12.6
|
%
|
|
|
7.7
|
%
|
|
|
16.5
|
%
|
|
|
|
11.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the quarter ended September 30, 2012
|
|
$
|
|
|
1,637
|
|
|
|
$
|
|
|
246
|
|
|
|
$
|
|
|
26
|
|
|
|
$
|
|
|
79
|
|
|
|
$
|
|
|
1,988
|
|
|
Asset impairment and exit costs - 2012
|
|
1
|
|
|
|
8
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9
|
|
|
Implementation costs - 2012
|
|
1
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1
|
|
|
Tobacco and health judgments - 2012
|
|
3
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
3
|
|
|
|
|
5
|
|
|
|
8
|
|
|
|
—
|
|
|
|
—
|
|
|
|
13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NPM Adjustment Items - 2013
|
|
145
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
145
|
|
|
Tobacco and health judgments - 2013
|
|
(13
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(13
|
)
|
|
|
|
132
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
132
|
|
|
Operations
|
|
51
|
|
|
|
23
|
|
|
|
2
|
|
|
|
13
|
|
|
|
89
|
|
|
For the quarter ended September 30, 2013
|
|
$
|
|
|
1,825
|
|
|
|
$
|
|
|
277
|
|
|
|
$
|
|
|
28
|
|
|
|
$
|
|
|
92
|
|
|
|
$
|
|
|
2,222
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Prior-period segment data have been recast to conform with
the current-period segment presentation.
|
Schedule 3
|
ALTRIA GROUP, INC.
and Subsidiaries
Consolidated
Statements of Earnings
For the Nine Months Ended September 30,
(dollars
in millions, except per share data)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues
|
|
$
|
|
|
18,386
|
|
|
|
|
$
|
|
|
18,376
|
|
|
|
|
0.1
|
%
|
|
Cost of sales 1
|
|
5,210
|
|
|
|
|
5,860
|
|
|
|
|
|
|
Excise taxes on products 1
|
|
5,127
|
|
|
|
|
5,336
|
|
|
|
|
|
|
Gross profit
|
|
8,049
|
|
|
|
|
7,180
|
|
|
|
|
12.1
|
%
|
|
Marketing, administration and research costs
|
|
1,550
|
|
|
|
|
1,511
|
|
|
|
|
|
|
Asset impairment and exit costs
|
|
1
|
|
|
|
|
46
|
|
|
|
|
|
|
Operating companies income
|
|
6,498
|
|
|
|
|
5,623
|
|
|
|
|
15.6
|
%
|
|
Amortization of intangibles
|
|
15
|
|
|
|
|
15
|
|
|
|
|
|
|
General corporate expenses
|
|
173
|
|
|
|
|
167
|
|
|
|
|
|
|
Changes to Mondelēz and PMI tax-related receivables/payables
|
|
25
|
|
|
|
|
(48
|
)
|
|
|
|
|
|
Corporate asset impairment and exit costs
|
|
—
|
|
|
|
|
1
|
|
|
|
|
|
|
Operating income
|
|
6,285
|
|
|
|
|
5,488
|
|
|
|
|
14.5
|
%
|
|
Interest and other debt expense, net
|
|
794
|
|
|
|
|
868
|
|
|
|
|
|
|
Loss on early extinguishment of debt
|
|
—
|
|
|
|
|
874
|
|
|
|
|
|
|
Earnings from equity investment in SABMiller
|
|
(738
|
)
|
|
|
|
(973
|
)
|
|
|
|
|
|
Earnings before income taxes
|
|
6,229
|
|
|
|
|
4,719
|
|
|
|
|
32.0
|
%
|
|
Provision for income taxes
|
|
2,182
|
|
|
|
|
1,641
|
|
|
|
|
|
|
Net earnings
|
|
4,047
|
|
|
|
|
3,078
|
|
|
|
|
31.5
|
%
|
|
Net earnings attributable to noncontrolling interests
|
|
—
|
|
|
|
|
(1
|
)
|
|
|
|
|
|
Net earnings attributable to Altria Group, Inc.
|
|
$
|
|
|
4,047
|
|
|
|
|
$
|
|
|
3,077
|
|
|
|
|
31.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per share data:
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted earnings per share attributable to
Altria Group, Inc.
|
|
$
|
|
|
2.02
|
|
|
|
|
$
|
|
|
1.51
|
|
|
|
|
33.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average diluted shares outstanding
|
|
2,001
|
|
|
|
|
2,028
|
|
|
|
|
(1.3
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Cost of sales includes charges for resolution expenses
related to state settlement and other tobacco agreements, and FDA user
fees. Supplemental information concerning those items and excise taxes
on products sold is shown in Schedule 5.
|
Schedule 4
|
ALTRIA GROUP, INC.
and Subsidiaries
Selected Financial
Data by Segment
For the Nine Months Ended September 30,
(dollars
in millions)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenues 1
|
|
|
|
|
Smokeable
Products
|
|
|
Smokeless
Products
|
|
|
Wine
|
|
|
All Other
|
|
|
Total
|
|
2013
|
|
|
$
|
|
|
16,448
|
|
|
|
$
|
|
|
1,333
|
|
|
|
$
|
|
|
411
|
|
|
|
$
|
|
|
194
|
|
|
|
$
|
|
|
18,386
|
|
|
2012
|
|
|
16,616
|
|
|
|
1,243
|
|
|
|
381
|
|
|
|
136
|
|
|
|
18,376
|
|
|
% Change
|
|
|
(1.0
|
)%
|
|
|
7.2
|
%
|
|
|
7.9
|
%
|
|
|
42.6
|
%
|
|
|
0.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the nine months ended September 30, 2012
|
|
|
$
|
|
|
16,616
|
|
|
|
$
|
|
|
1,243
|
|
|
|
$
|
|
|
381
|
|
|
|
$
|
|
|
136
|
|
|
|
$
|
|
|
18,376
|
|
|
PMCC leveraged lease charge - 2012
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
7
|
|
|
|
7
|
|
|
Operations
|
|
|
(168
|
)
|
|
|
90
|
|
|
|
30
|
|
|
|
51
|
|
|
|
3
|
|
|
For the nine months ended September 30, 2013
|
|
|
$
|
|
|
16,448
|
|
|
|
$
|
|
|
1,333
|
|
|
|
$
|
|
|
411
|
|
|
|
$
|
|
|
194
|
|
|
|
$
|
|
|
18,386
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Companies Income 1
|
|
|
|
|
Smokeable
Products
|
|
|
Smokeless
Products
|
|
|
Wine
|
|
|
All Other
|
|
|
Total
|
|
2013
|
|
|
$
|
|
|
5,471
|
|
|
|
$
|
|
|
769
|
|
|
|
$
|
|
|
73
|
|
|
|
$
|
|
|
185
|
|
|
|
$
|
|
|
6,498
|
|
|
2012
|
|
|
4,716
|
|
|
|
678
|
|
|
|
63
|
|
|
|
166
|
|
|
|
5,623
|
|
|
% Change
|
|
|
16.0
|
%
|
|
|
13.4
|
%
|
|
|
15.9
|
%
|
|
|
11.4
|
%
|
|
|
15.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the nine months ended September 30, 2012
|
|
|
$
|
|
|
4,716
|
|
|
|
$
|
|
|
678
|
|
|
|
$
|
|
|
63
|
|
|
|
$
|
|
|
166
|
|
|
|
$
|
|
|
5,623
|
|
|
Asset impairment and exit costs - 2012
|
|
|
24
|
|
|
|
22
|
|
|
|
—
|
|
|
|
—
|
|
|
|
46
|
|
|
Implementation (gain) costs - 2012
|
|
|
(11
|
)
|
|
|
5
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(6
|
)
|
|
PMCC leveraged lease charge - 2012
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
7
|
|
|
|
7
|
|
|
Tobacco and health judgments - 2012
|
|
|
4
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
4
|
|
|
|
|
|
17
|
|
|
|
27
|
|
|
|
—
|
|
|
|
7
|
|
|
|
51
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NPM Adjustment Items - 2013
|
|
|
664
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
664
|
|
|
Asset impairment and exit costs - 2013
|
|
|
(1
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1
|
)
|
|
Implementation costs - 2013
|
|
|
(1
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1
|
)
|
|
Tobacco and health judgments - 2013
|
|
|
(18
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(18
|
)
|
|
|
|
|
644
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
644
|
|
|
Operations
|
|
|
94
|
|
|
|
64
|
|
|
|
10
|
|
|
|
12
|
|
|
|
180
|
|
|
For the nine months ended September 30, 2013
|
|
|
$
|
|
|
5,471
|
|
|
|
$
|
|
|
769
|
|
|
|
$
|
|
|
73
|
|
|
|
$
|
|
|
185
|
|
|
|
$
|
|
|
6,498
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Prior-period segment data have been recast to conform with
the current-period segment presentation.
|
Schedule 5
|
ALTRIA GROUP, INC.
and Subsidiaries
Supplemental Financial
Data by Segment
(dollars in millions)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the
Quarters Ended
September 30,
|
|
|
|
For the
Nine Months Ended
September 30,
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
2013
|
|
|
|
2012
|
|
The segment detail of excise taxes on products sold is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Smokeable products
|
|
$
|
|
|
1,751
|
|
|
|
|
$
|
|
|
1,742
|
|
|
|
|
$
|
|
|
5,016
|
|
|
|
|
$
|
|
|
5,239
|
|
Smokeless products
|
|
37
|
|
|
|
|
29
|
|
|
|
|
96
|
|
|
|
|
83
|
|
Wine
|
|
5
|
|
|
|
|
5
|
|
|
|
|
15
|
|
|
|
|
14
|
|
|
|
$
|
|
|
1,793
|
|
|
|
|
$
|
|
|
1,776
|
|
|
|
|
$
|
|
|
5,127
|
|
|
|
|
$
|
|
|
5,336
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The segment detail of charges for resolution expenses related to
state
settlement and other tobacco agreements included in cost of
sales
is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Smokeable products 1
|
|
$
|
|
|
1,133
|
|
|
|
|
$
|
|
|
1,223
|
|
|
|
|
$
|
|
|
2,969
|
|
|
|
|
$
|
|
|
3,657
|
|
Smokeless products
|
|
3
|
|
|
|
|
3
|
|
|
|
|
9
|
|
|
|
|
8
|
|
|
|
$
|
|
|
1,136
|
|
|
|
|
$
|
|
|
1,226
|
|
|
|
|
$
|
|
|
2,978
|
|
|
|
|
$
|
|
|
3,665
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The segment detail of FDA user fees included in cost of sales is
as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Smokeable products
|
|
$
|
|
|
59
|
|
|
|
|
$
|
|
|
56
|
|
|
|
|
$
|
|
|
176
|
|
|
|
|
$
|
|
|
165
|
|
Smokeless products
|
|
1
|
|
|
|
|
1
|
|
|
|
|
2
|
|
|
|
|
2
|
|
|
|
$
|
|
|
60
|
|
|
|
|
$
|
|
|
57
|
|
|
|
|
$
|
|
|
178
|
|
|
|
|
$
|
|
|
167
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Amounts include a pre-tax credit of $145 million and $664
million for the quarter and nine months ended September 30, 2013,
respectively, related to the NPM Adjustment Items.
|
Schedule 6
|
ALTRIA GROUP, INC.
and Subsidiaries
Net Earnings and
Diluted Earnings Per Share - Attributable to Altria Group, Inc.
For
the Quarters Ended September 30,
(dollars in millions, except
per share data)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings
|
|
|
|
Diluted EPS
|
|
2013 Net Earnings
|
|
|
$
|
|
|
1,396
|
|
|
|
|
$
|
|
|
0.70
|
|
|
2012 Net Earnings
|
|
|
$
|
|
|
657
|
|
|
|
|
$
|
|
|
0.32
|
|
|
% Change
|
|
|
100
|
%+
|
|
|
|
100
|
%+
|
|
|
|
|
|
|
|
|
|
|
Reconciliation:
|
|
|
|
|
|
|
|
|
2012 Net Earnings
|
|
|
$
|
|
|
657
|
|
|
|
|
$
|
|
|
0.32
|
|
|
|
|
|
|
|
|
|
|
|
2012 Asset impairment, exit and implementation costs
|
|
|
7
|
|
|
|
|
—
|
|
|
2012 Tobacco and health judgments
|
|
|
2
|
|
|
|
|
—
|
|
|
2012 SABMiller special items
|
|
|
12
|
|
|
|
|
0.01
|
|
|
2012 Loss on early extinguishment of debt
|
|
|
559
|
|
|
|
|
0.28
|
|
|
2012 Tax items
|
|
|
(62
|
)
|
|
|
|
|
(0.03
|
)
|
|
|
Subtotal 2012 special items
|
|
|
518
|
|
|
|
|
0.26
|
|
|
|
|
|
|
|
|
|
|
|
2013 NPM Adjustment Items
|
|
|
93
|
|
|
|
|
0.05
|
|
|
2013 Tobacco and health judgments
|
|
|
(10
|
)
|
|
|
|
|
—
|
|
|
2013 SABMiller special items
|
|
|
(9
|
)
|
|
|
|
|
(0.01
|
)
|
|
|
2013 Tax items
|
|
|
25
|
|
|
|
|
0.01
|
|
|
Subtotal 2013 special items
|
|
|
99
|
|
|
|
|
0.05
|
|
|
|
|
|
|
|
|
|
|
|
Fewer shares outstanding
|
|
|
—
|
|
|
|
|
0.01
|
|
|
Change in tax rate
|
|
|
44
|
|
|
|
|
0.02
|
|
|
Operations
|
|
|
78
|
|
|
|
|
0.04
|
|
|
2013 Net Earnings
|
|
|
$
|
|
|
1,396
|
|
|
|
|
$
|
|
|
0.70
|
|
|
|
|
|
|
|
|
|
|
|
2013 Net Earnings Adjusted For Special Items
|
|
|
$
|
|
|
1,297
|
|
|
|
|
$
|
|
|
0.65
|
|
|
2012 Net Earnings Adjusted For Special Items
|
|
|
$
|
|
|
1,175
|
|
|
|
|
$
|
|
|
0.58
|
|
|
% Change
|
|
|
10.4
|
%
|
|
|
|
|
12.1
|
%
|
|
|
Schedule 7
|
ALTRIA GROUP, INC.
and Subsidiaries
Net Earnings 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 EPS
|
|
2013 Net Earnings
|
|
|
$
|
|
|
4,047
|
|
|
|
|
$
|
|
|
2.02
|
|
|
2012 Net Earnings
|
|
|
$
|
|
|
3,077
|
|
|
|
|
$
|
|
|
1.51
|
|
|
% Change
|
|
|
31.5
|
%
|
|
|
|
33.8
|
%
|
|
|
|
|
|
|
|
|
|
|
Reconciliation:
|
|
|
|
|
|
|
|
|
2012 Net Earnings
|
|
|
$
|
|
|
3,077
|
|
|
|
|
$
|
|
|
1.51
|
|
|
|
|
|
|
|
|
|
|
|
2012 Asset impairment, exit and implementation costs
|
|
|
25
|
|
|
|
|
0.01
|
|
|
2012 Tobacco and health judgments
|
|
|
3
|
|
|
|
|
—
|
|
|
2012 SABMiller special items
|
|
|
(172
|
)
|
|
|
|
(0.08
|
)
|
|
2012 Loss on early extinguishment of debt
|
|
|
559
|
|
|
|
|
0.28
|
|
|
2012 PMCC leveraged lease benefit
|
|
|
(68
|
)
|
|
|
|
(0.03
|
)
|
|
2012 Tax items 1
|
|
|
(51
|
)
|
|
|
|
(0.03
|
)
|
|
Subtotal 2012 special items
|
|
|
296
|
|
|
|
|
0.15
|
|
|
|
|
|
|
|
|
|
|
|
2013 NPM Adjustment Items
|
|
|
427
|
|
|
|
|
0.21
|
|
|
2013 Asset impairment, exit and implementation costs
|
|
|
(1
|
)
|
|
|
|
—
|
|
|
2013 Tobacco and health judgments
|
|
|
(14
|
)
|
|
|
|
—
|
|
|
2013 SABMiller special items
|
|
|
(16
|
)
|
|
|
|
(0.01
|
)
|
|
2013 Tax items
|
|
|
25
|
|
|
|
|
0.01
|
|
|
Subtotal 2013 special items
|
|
|
421
|
|
|
|
|
0.21
|
|
|
|
|
|
|
|
|
|
|
|
Fewer shares outstanding
|
|
|
—
|
|
|
|
|
0.02
|
|
|
Change in tax rate
|
|
|
58
|
|
|
|
|
0.03
|
|
|
Operations
|
|
|
195
|
|
|
|
|
0.10
|
|
|
2013 Net Earnings
|
|
|
$
|
|
|
4,047
|
|
|
|
|
$
|
|
|
2.02
|
|
|
|
|
|
|
|
|
|
|
|
2013 Net Earnings Adjusted For Special Items
|
|
|
$
|
|
|
3,626
|
|
|
|
|
$
|
|
|
1.81
|
|
|
2012 Net Earnings Adjusted For Special Items
|
|
|
$
|
|
|
3,373
|
|
|
|
|
$
|
|
|
1.66
|
|
|
% Change
|
|
|
7.5
|
%
|
|
|
|
9.0
|
%
|
|
|
|
|
|
|
|
|
|
1 Excludes the tax impact included in the PMCC leveraged
lease benefit.
|
Schedule 8
|
ALTRIA GROUP, INC.
and Subsidiaries
Condensed Consolidated
Balance Sheets
(dollars in millions)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2013
|
|
|
|
December 31, 2012
|
|
Assets
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
$
|
|
|
4,211
|
|
|
|
|
$
|
|
|
2,900
|
|
Inventories
|
|
|
1,718
|
|
|
|
|
1,746
|
|
Deferred income taxes
|
|
|
1,218
|
|
|
|
|
1,216
|
|
Other current assets
|
|
|
402
|
|
|
|
|
453
|
|
Property, plant and equipment, net
|
|
|
2,041
|
|
|
|
|
2,102
|
|
Goodwill and other intangible assets, net
|
|
|
17,237
|
|
|
|
|
17,252
|
|
Investment in SABMiller
|
|
|
6,520
|
|
|
|
|
6,637
|
|
Finance assets, net
|
|
|
2,153
|
|
|
|
|
2,581
|
|
Other long-term assets
|
|
|
450
|
|
|
|
|
442
|
|
Total assets
|
|
|
$
|
|
|
35,950
|
|
|
|
|
$
|
|
|
35,329
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
|
|
|
Current portion of long-term debt
|
|
|
$
|
|
|
1,984
|
|
|
|
|
$
|
|
|
1,459
|
|
Accrued settlement charges
|
|
|
3,047
|
|
|
|
|
3,616
|
|
Other current liabilities
|
|
|
3,306
|
|
|
|
|
3,184
|
|
Long-term debt
|
|
|
12,892
|
|
|
|
|
12,419
|
|
Deferred income taxes
|
|
|
6,466
|
|
|
|
|
6,652
|
|
Accrued postretirement health care costs
|
|
|
2,492
|
|
|
|
|
2,504
|
|
Accrued pension costs
|
|
|
1,243
|
|
|
|
|
1,735
|
|
Other long-term liabilities
|
|
|
505
|
|
|
|
|
556
|
|
Total liabilities
|
|
|
31,935
|
|
|
|
|
32,125
|
|
Redeemable noncontrolling interest
|
|
|
34
|
|
|
|
|
34
|
|
Total stockholders’ equity
|
|
|
3,981
|
|
|
|
|
3,170
|
|
Total liabilities and stockholders’ equity
|
|
|
$
|
|
|
35,950
|
|
|
|
|
$
|
|
|
35,329
|
|
|
|
|
|
|
|
|
|
|
Total debt
|
|
|
$
|
|
|
14,876
|
|
|
|
|
$
|
|
|
13,878
|
Copyright Business Wire 2013