Altria's earnings top estimates and tobacco company reaffirms full-year guidance

By Ciara Linnane

Tobacco company still expects limited impact from enforcement efforts in the illicit e-vapor market in 2024

Altria Group Inc. matched profit estimates for the first quarter, while revenue net of excise taxes squeezed a small beat and the company backed its full-year guidance, reiterating its stance that there will be limited impact from enforcement efforts in the illicit e-vapor market in 2024.

The company said early Thursday it had net income of $2.129 billion, or $1.21 a share, in the quarter, up from $1.787 billion, or $1.00 a share, in the year-earlier period. Adjusted for one-time items, the company had per-share earnings of $1.15, matching the FactSet consensus.

Revenue fell 2.5% to $5.576 billion from $5.719 billion a year ago. Excluding excise taxes, revenue fell 1% to $4.717 billion, just ahead of the $4.712 billion FactSet consensus.

The tobacco giant said it still expects full-year adjusted EPS of $5.05 to $5.17, up 2% to 4.5% from 2023.

"While the 2024 full-year adjusted diluted EPS guidance accounts for a range of scenarios, the external environment remains dynamic," the company said in a statement.

Altria will monitor conditions related to the economy, including the impact of inflation, adult tobacco consumer (ATC) dynamics, including purchasing patterns and adoption of smoke-free products, illicit e-vapor enforcement and regulatory, litigation and legislative developments.

In October, Altria's NJOY LLC operating company filed lawsuits against 34 foreign and U.S. makers, distributors and online retailers of illicit disposable-vape products sold in California and other states.

The suit alleges that the companies are violating California's flavor-ban law, unlawful under federal law and subject to action from the Food and Drug Administration. The companies are illegally competing with companies that comply with state and federal laws, according to Altria.

The suit is seeking a nationwide injunction against the import and sale of the products along with "significant" compensatory and punitive damages.

Shipment volume of the company's smokeless tobacco NJOY consumables came to 10.9 million units in the first quarter, while shipment volume of NJOY devices was about 1.0 million units.

NJOY's retail share in the U.S. multi-outlet and convenience channel was 4.3%, an increase of 0.6 market share points from the fourth quarter.

In March, the company raised about $2.4 billion by selling part of its stake in Anheuser-Busch InBev (BE:ABI), which it used to buy back its own stock. The company is expecting to have about $1.0 billion remaining in the current authorization once it completes an accelerated share repurchase program.

The stock was flat premarket and has gained 6.4% in the year to date, while the S&P 500 has gained 6.3%.

-Ciara Linnane

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04-25-24 0737ET

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