Altria Group, Inc. (Altria) (NYSE:MO) held its 2015 Annual Meeting of
Shareholders (Annual Meeting) today. Altria’s Chairman, Chief Executive
Officer and President, Marty Barrington, summarized Altria’s 2014 and
first quarter 2015 operating and financial results and emphasized
Altria’s focus on its people and work culture, commitment to communities
and corporate responsibility initiatives.
Voting Results for Altria’s Annual Meeting
At the Annual Meeting, Altria’s shareholders elected to a one-year term
each of the 11 nominees for director named in Altria’s proxy statement;
approved the 2015 Performance Incentive Plan and the 2015 Stock
Compensation Plan for Non-Employee Directors; ratified the selection of
PricewaterhouseCoopers LLP as Altria’s independent registered public
accounting firm for the fiscal year ending December 31, 2015; approved,
on an advisory basis, the compensation of Altria’s named executive
officers; and defeated three shareholder proposals. Final voting results
will be reported in a Current Report on Form 8-K filed with the
Securities and Exchange Commission.
Regular Quarterly Dividend
Following the Annual Meeting, Altria’s Board of Directors declared a
regular quarterly dividend of $0.52 per share, payable on July 10, 2015,
to shareholders of record as of June 15, 2015. The ex-dividend date is
June 11, 2015.
2015 Full-Year Guidance
Altria reaffirms its guidance for 2015 full-year adjusted diluted EPS,
which excludes the special items discussed in Schedule 1, to be in the
range of $2.75 to $2.80, representing a growth rate of 7% to 9% from an
adjusted diluted EPS base of $2.57 in 2014, as shown in Schedule 1.
The factors described in the Forward-Looking and Cautionary Statements
section of this release represent continuing risks to Altria’s forecast.
Remarks and Presentation
A copy of Mr. Barrington’s prepared remarks and business presentation,
as well as a replay of the audio webcast of the Annual Meeting, are
available on altria.com and via the Altria Investor app.
Altria’s Profile
Altria’s wholly-owned subsidiaries include Philip Morris USA Inc. (PM
USA), U.S. Smokeless Tobacco Company LLC (USSTC), John Middleton Co., Nu
Mark LLC, Ste. Michelle Wine Estates Ltd. (Ste. Michelle) and Philip
Morris Capital Corporation. Altria holds a continuing economic and
voting interest in SABMiller plc (SABMiller).
The brand portfolios of Altria’s tobacco operating companies include Marlboro®,
Black & Mild®, Copenhagen®,
Skoal®, MarkTen® and
Green Smoke®. 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™, Torres®
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 and on the Altria Investor app.
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, 2014 and its Quarterly Report on Form 10-Q for
the period ended March 31, 2015.
These factors include the following: significant competition; changes in
adult consumer preferences and demand for Altria’s operating companies’
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, and investments in, 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. 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
First Quarter 2015 Special Items and Reconciliation of 2014
Adjusted Results
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Altria’s First Quarter 2015 Special Items
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Tobacco and health litigation items
|
|
|
|
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$
|
|
0.01
|
|
SABMiller special items
|
|
|
|
|
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0.03
|
|
Loss on early extinguishment of debt
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0.07
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|
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$
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0.11
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|
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Reconciliation of Altria’s 2014 Adjusted Results
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Full Year
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2014
|
Reported diluted EPS
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|
|
|
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$
|
|
2.56
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|
NPM Adjustment Items
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(0.03
|
)
|
Asset impairment, exit, integration and acquisition-related costs
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0.01
|
|
Tobacco and health litigation items
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|
|
|
|
|
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|
0.01
|
|
SABMiller special items
|
|
|
|
|
|
|
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0.01
|
|
Loss on early extinguishment of debt
|
|
|
|
|
|
|
|
0.02
|
|
Tax items
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|
|
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|
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(0.01
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)
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Adjusted diluted EPS
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|
|
|
|
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$
|
|
2.57
|
|
Altria reports its financial results in accordance with U.S. generally
accepted accounting principles (GAAP). Altria’s management reviews
certain financial results, including diluted EPS, on an adjusted basis,
which exclude 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 special items, certain tax items, charges associated with
tobacco and health litigation items, and settlements of, and
determinations made in connection with, certain non-participating
manufacturer (NPM) adjustment disputes (such settlements and
determinations are referred to collectively as NPM Adjustment Items).
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, are
difficult to predict and can distort underlying business trends and
results. Altria’s management believes that these adjusted financial
measures 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 financial measures for
planning, forecasting and evaluating business and financial performance,
including allocating resources and evaluating results relative to
employee compensation targets. These adjusted financial measures are not
consistent with GAAP, and 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.
Altria’s full-year adjusted diluted EPS guidance excludes the impact of
certain income and expense items, including those items noted in the
preceding paragraph. Altria’s management cannot estimate on a
forward-looking basis the impact of these items on its reported diluted
EPS because these items, which could be significant, are difficult to
predict and may be highly variable. As a result, Altria does not provide
a corresponding GAAP financial measure for, or reconciliation to, its
adjusted diluted EPS guidance.
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