A Philip Morris Marlboro brand cigarette burns in an ashtray for this photograph arranged in Tiskilwa, Illinois on Wednesday, July 12, 2017.
Daniel Acker | Bloomberg | Getty Images
Altria’s first quarter profits fell as revenues fell below estimates as cigarette shipments continued to decline.
Parent company Marlboro cigarettes has phased out its traditional tobacco products business and announced it has acquired the remaining 20% stake in On, a nicotine sachet product.
The company’s shares rose less than 1% in pre-market trading.
Here’s what the company reported for the first quarter compared to what Wall Street expected, based on an analyst survey by Refinitiv:
- Earnings per share: $ 1.07 adjusted vs. $ 1.05 expected
- Turnover: $ 4.88 billion, excluding excise taxes, against $ 4.98 billion expected
Net income fell to $ 1.42 billion, or 77 cents per share, from $ 1.55 billion, or 83 cents per share, a year earlier.
Excluding items, Altria gained $ 1.07 per share, exceeding the $ 1.05 per share expected by analysts polled by Refinitiv.
Revenue fell 5.1% to $ 6.04 billion, from $ 6.36 billion a year ago. However, after excluding excise taxes, its revenues stood at $ 4.88 billion, which was below $ 4.98 billion, analysts expected.
Total cigarette shipments fell 12% year over year.
Altria has once again lowered the value of its Juul vaping brand.
“Against a difficult comparison, our tobacco business performed well in the first quarter and we continued to make progress in advancing our non-combustible portfolio,” said Billy Gifford, Managing Director of Altria, in a press release. .
The Food and Drug Administration, which regulates tobacco products in the United States, could approach a ban on menthol cigarettes as early as this week after years of deliberation. Menthol cigarettes have often been used disproportionately by people of color. The vast majority of black smokers use menthol cigarettes, and black men have the highest lung cancer death rates in the United States.
Additionally, the Biden administration announced last week that it was considering capping nicotine levels in cigarettes. If this policy is continued, tobacco companies may challenge it.
Altria previously sent a letter to the FDA asking them to let them know that nicotine, the addictive ingredient in cigarettes, does not cause cancer. The company said it would help smokers switch to potentially less risky non-combustible options, such as their Iqos heated tobacco stick and On nicotine sachet.
See the full publication of the results here.