Altria Group, Inc. · NYSE:MO
Altria — Q1 2024 Earnings Presentation
27 slides from Altria's earnings presentation, Apr 25, 2024
Slide 1: Altria's First-Quarter 2024 Earnings Conference Call
Altria’s First-Quarter 2024 Earnings Conference Call April 25, 2024 1 | ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY
Slide 2: Safe Harbor Statement
Safe Harbor Statement Statements, including earnings guidance, in this presentation that are not reported financial results or other historical information are “forward-looking statements” within the meaning of Private Securities Litigation Reform Act of 1995. Such forward-looking statements are bas
Slide 3: 3 | ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY
3 | ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY
Slide 4: Agenda
Agenda The continued early momentum behind NJOY’s commercialization; The state of the e-vapor category and enforcement progress; Encouraging first-quarter results from on!; and Our financial results and the partial sale of our ABI investment. 4 | ALCS | Q1 2024 | 4.25.24 | For Investor Purpo
Slide 5: Continued NJOY Progress
Continued NJOY Progress Cumulative Stores with Distribution (in thousands) +134% 82 76 42 35 Q2 '23 Q3 '23 Q4 '23 Q1 '24 Source: STARS week ending 3/31/24 5 | ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY
Slide 6: NJOY Share Momentum
NJOY Share Momentum NJOY Consumables Retail Share (total U.S.) +1.1pp +0.6pp 4.4 4.3 3.7 3.3 Sep '23 Mar '24 Q4 '23 Q1 '24 Source: Circana Projected Total U.S. MOC week ending 3/31/2024 6 | ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY
Slide 7: Encouraging Initial NJOY Trial and Adoption Performance
Encouraging Initial NJOY Trial and Adoption Performance NJOY Adoption Performance (one retail account example) Pre-Trial During Trial Post-Trial +9pp +5pp Jun-23 Jul-23 Aug-23 Sep-23 Oct-23 Nov-23 Dec-23 Jan-24 Feb-24 Mar-24 Source: Circana Non-Projected Total U.S. MOC week ending 3/31/2024 7 | ALCS
Slide 8: Compelling NJOY Device Share Performance
Compelling NJOY Device Share Performance NJOY Device Retail Share (total U.S.) +6.4pp 11.5 9.1 5.1 Q3 '23 Q4 '23 Q1 '24 Source: Circana Projected Total U.S. MOC week ending 3/31/2024 8 | ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY
Slide 9: NJOY Shipment Volume
NJOY Shipment Volume NJOY Shipment Volume (in millions) Consumables Devices 12.0 11.9 0.9 1.0 11.1 10.9 Q4 '23 Q1 '24 9 | ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY
Slide 10: NJOY 2024 Plans for Awareness and Brand Affinity
NJOY 2024 Plans for Awareness and Brand Affinity Improved positioning at retail; New equity campaign that emphasizes NJOY’s unique attributes and exceptional vaping experience; New adult-only event marketing infrastructure; and Our adult tobacco consumer database, which allows us to communic
Slide 11: FDA E-Vapor Related Enforcement Actions
FDA E-Vapor Related Enforcement Actions Civil Monetary Penalties Issued for E-Vapor Related Import Refusals Unauthorized E-Vapor Products 452 E-Liquid Disposable 45 42 262 22 18 15 9 52 6 5 30 4 Q1 '23 Q2 '23 Q3 '23 Q4 '23 Q1 '24 Q1 '23 Q2 '23 Q3 '23 Q4 '23 Q1 '24 Source: ALCS analysis of FDA, Compl
Slide 12: State of the E-Vapor Market
State of the E-Vapor Market We believe the FDA’s enforcement approach is not of the scale or scope needed to bring about fundamental change in the marketplace. We identified to the Agency specific steps we believe they can take to build a more effective compliance and enforcement program to addr
Slide 13: State of the E-Vapor Market
State of the E-Vapor Market We continue to work with state legislatures that have passed or are considering legislation requiring manufacturers to certify compliance with FDA requirements. We filed a new lawsuit against five manufacturers, four brick-and-mortar retailers and three online retaile
Slide 14: U.S. Oral Tobacco Category and on! Shipment Volume
U.S. Oral Tobacco Category and on! Shipment Volume Oral Tobacco Industry Volume Growth on! Shipment Volume (estimates, six months ended) (cans in millions) +32.1% 33.3 9.5% 25.2 1.5% 1.5% 3/31/2022 3/31/2023 3/31/2024 Q1 '23 Q1 '24 Source: ALCS CMII estimates. Rounded to the nearest 0.5%. Oral tobac
Slide 15: Continued on! Share Momentum
Continued on! Share Momentum on! Share of Oral Tobacco Category (total U.S.) +0.7pp 7.1 6.4 Q1 '23 Q1 '24 Source: ALCS CMII estimates based on Circana Projected Total U.S. MOC data week ending 3/31/2024 15 | ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY
Slide 16: 2024 Financial Outlook
2024 Financial Outlook We reaffirm our guidance to deliver 2024 full- year adjusted diluted earnings per share (EPS)* in a range of $5.05 to $5.17. This range represents an adjusted diluted EPS growth rate of 2% to 4.5% from a base of $4.95 in 2023. *For reconciliations of non-GAAP to GAAP measures
Slide 17: 2024 Financial Outlook
2024 Financial Outlook Q1 Adjusted Diluted EPS* We expect 2024 adjusted diluted EPS* growth to be weighted to the second half of the year due to: (2.5)% the timing of the NJOY acquisition in 2023; and $1.18 $1.15 the impact of two additional shipping days in the second half of the year. Q1 '23
Slide 18: Smokeable Products Segment
Smokeable Products Segment Adjusted Operating Companies Income* (OCI) and Adjusted OCI Margins* Adjusted OCI Adjusted OCI Margins ($ in millions) (2.5)% (0.2)pp 60.4% 60.2% $2,515 $2,451 Q1 '23 Q1 '24 Q1 '23 Q1 '24 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 18 | ALCS | Q1 20
Slide 19: Q1 Adjusted Cigarette Decline Rates
Q1 Adjusted Cigarette Decline Rates Smokeable Products Segment Total Industry Q1 '23 Q1 '24 Q1 '23 Q1 '24 (9.0)% (9.0)% (10.0)% (11.0)% Source: ALCS CMII estimates. Rounded to the nearest 0.5%. Note: Estimates are subject to revision due to wholesaler resubmission of inventory data. 19 | ALCS | Q1 2
Slide 20: Discount Retail Share
Discount Retail Share Branded Discount (Major Manufacturers) Deep Discount (All Other) 28.7 29.1 28.3 28.3 28.3 15.3 15.3 15.5 15.4 15.3 12.8 12.9 13.0 13.4 13.8 Q1 '23 Q2 '23 Q3 '23 Q4 '23 Q1 '24 Source: Circana InfoScan Cigarette 2024-Blended, week ending 3/31/2024 20 | ALCS | Q1 2024 | 4.25.24 |
Slide 21: Marlboro Retail Share and Share of Premium
Marlboro Retail Share and Share of Premium Marlboro Retail Share Marlboro Share of Premium +0.7pp 58.6 59.3 42.0 42.0 Q1 '23 Q1 '24 Q1 '23 Q1 '24 Source: Circana InfoScan Cigarette 2024-Blended, week ending 3/31/2024 21 | ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY
Slide 22: John Middleton Cigars
John Middleton Cigars Reported Shipment Volume (6.1)% 444 417 Q1 '23 Q1 '24 22 | ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY
Slide 23: Oral Tobacco Products Segment
Oral Tobacco Products Segment Adjusted OCI* and Adjusted OCI Margins* Adjusted OCI Adjusted OCI Margins ($ in millions) +4.6% +0.2pp 69.3% 69.5% $435 $416 Q1 '23 Q1 '24 Q1 '23 Q1 '24 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 23 | ALCS | Q1 2024 | 4.25.24 | For Investor Purp
Slide 24: Oral Tobacco Products Segment Retail Share
Oral Tobacco Products Segment Retail Share Retail Share MST + Snus on! (7.1)pp 44.9 6.4 37.8 7.1 38.5 30.7 Q1 '23 Q1 '24 Source: Circana InfoScan Oral Tobacco 2024-Blended week ending 3/31/2024 24 | ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY
Slide 25: Capital Allocation - ABI Investment
Capital Allocation - ABI Investment All third-party trademarks remain the property of their respective owners. 25 | ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY
Slide 26: Capital Allocation - Dividends and Balance Sheet
Capital Allocation - Dividends and Balance Sheet Dividends • Paid approximately $1.7 billion in dividends in the first-quarter. • Retired $1.1 billion of notes that came due in the first-quarter. Guidance Debt • 2.1x debt-to-EBITDA* ratio as of March 31, 2024. *For reconciliations of non-GAAP to GAA
Slide 27: 27 ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY
27 ALCS | Q1 2024 | 4.25.24 | For Investor Purposes ONLY All new products subject to FDA authorization. Third-party trademarks remain the property of their respective owners.