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Altria
🇺🇸 NYSE:MO
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•
Dec 31, 2019

Altria Q4 2019 Earnings Report

Altria's fourth-quarter earnings were impacted by a significant impairment charge related to its investment in JUUL, but its core tobacco businesses demonstrated strong performance.

Key Takeaways

Altria reported a net loss due to a $4.1 billion impairment charge on its JUUL investment, though its core tobacco businesses performed well. The company exceeded its cost savings target and increased its dividend. Altria is revising its terms of investment in JUUL and focusing on pre-market tobacco product applications.

Altria's core tobacco businesses delivered outstanding performance in 2019.

Altria exceeded its $575 million annualized cost savings target.

Altria increased the dividend for the 54th time in 50 years

Altria recorded a fourth-quarter, non-cash pre-tax impairment charge of $4.1 billion related to its investment in JUUL.

Total Revenue
$4.8B
Previous year: $4.79B
+0.3%
EPS
$1.02
Previous year: $0.95
+7.4%
Marlboro Retail Share
43%
Previous year: 43.1%
-0.2%
Gross Profit
$3.08B
Previous year: $2.92B
+5.5%
Cash and Equivalents
$2.12B
Previous year: $1.33B
+58.8%
Free Cash Flow
$2.48B
Previous year: $1.72B
+44.1%
Total Assets
$49.3B
Previous year: $55.5B
-11.2%

Altria

Altria

Altria Revenue by Segment

Forward Guidance

Altria expects its 2020 full-year adjusted diluted EPS to be in a range of $4.39 to $4.51, representing a growth rate of 4% to 7% from an adjusted diluted EPS base of $4.22 in 2019.

Positive Outlook

  • Increased investments related to PM USA’s commercialization efforts for IQOS
  • Helix’s plans to manufacture and expand U.S. distribution of on!
  • One extra shipping day in the first quarter.
  • Altria expects its 2020 full-year adjusted diluted EPS to be in a range of $4.39 to $4.51
  • Altria expects its 2020 full-year adjusted effective tax rate will be in a range of 23.5% to 24.5%

Challenges Ahead

  • Estimated per share charges in 2020 of $0.05 of tax expense resulting from the Tax Cuts and Jobs Act (Tax Reform Act) related to a tax basis adjustment to Altria’s ABI investment
  • Altria expects the 2020 full-year total domestic cigarette industry adjusted volume decline rate to be in a range of 4% to 6%, which includes the impact of federal legislation raising the minimum age to purchase all tobacco products to 21.
  • Altria expects continued volatility across tobacco categories and will no longer provide a multi-year forecast for U.S. cigarette volume declines.
  • unfavorable litigation outcomes
  • government, including U.S. Food and Drug Administration (FDA), and private sector actions that impact adult tobacco consumer acceptability of, or access to, tobacco products

Revenue & Expenses

Visualization of income flow from segment revenue to net income

Company Overview

Full financial data and analysis

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