Altria Group, Inc. · NYSE:MO
Altria — Q4 2024 Earnings Presentation
34 slides from Altria's earnings presentation, Jan 30, 2025
Slide 1: Altria's Fourth-Quarter and Full-Year 2024 Earnings Conference Call
Altria’s Fourth-Quarter and Full-Year 2024 Earnings Conference Call January 30, 2025 1 | ALCS | Q4 2024 | 1.30.25 | 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 | Q4 2024 | 1.30.25 | For Investor Purposes ONLY
3 | ALCS | Q4 2024 | 1.30.25 | For Investor Purposes ONLY
Slide 4: Strong Financial Results and Significant Cash Returns
Strong Financial Results and Significant Cash Returns Adjusted Diluted Earnings Per Share (EPS)* Cash Returned to Shareholders ($ in billions) +3.4% $10.2 $5.12 $4.95 $8.4 $8.1 $7.8 $6.3 FY 2023 FY 2024 2020 2021 2022 2023 2024 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 4 |
Slide 5: Meaningful Progress Toward Our Vision
Meaningful Progress Toward Our Vision NJOY receiving the first and only marketing granted orders from the FDA for menthol e-vapor products; Submitting PMTA applications to the FDA for next generation NJOY and on! products; Continuing preparations to commercialize Ploom, through our joint ventu
Slide 6: Smoke-Free Categories Continue to Grow
Smoke-Free Categories Continue to Grow Nicotine Space Estimated Volume (volume in billions of equivalized cigarette packs) Combustible Oral Tobacco E-Vapor +2.0% CAGR 16.8 17.2 16.6 16.0 16.1 15.5 ~20% ~45% 2019 2020 2021 2022 2023 2024 Source: ALCS CMII Estimates; ATCT; STARS; Circana; ALCS Consume
Slide 7: Illicit Products Driving E-Vapor Category Growth
Illicit Products Driving E-Vapor Category Growth E-Vapor Category Volume Vapers by Form – Past 30-Day Usage (volume in billions of equivalized cigarette packs) (twelve months ended, in millions) Disposable All Other Forms ~20.0 ~6.0 ~17.0 ~4.5 ~13.5 ~9.5 2023 2024 2023 2024 Source: ALCS Estimates; A
Slide 8: The Regulatory Environment Remains Challenging
The Regulatory Environment Remains Challenging It has become clear that two markets exist in the U.S. – one for those who operate within the regulatory framework and one for those who flagrantly violate and evade the rules. • The FDA has not authorized enough smoke- free products to meet consumer de
Slide 9: 2028 Enterprise Goals
2028 Enterprise Goals 2028 Enterprise Goals Corporate U.S. Smoke-Free Products Long-Term Growth Financial Share of U.S. U.S. International Policy & Total Adjusted U.S. Tobacco Smoke-Free Smoke-Free Innovative Non-Nicotine Capital OCI Margin Space Volume Revenue Smoke-Free Allocation 9 | ALCS | Q4 20
Slide 10: 2028 Enterprise Goals and NJOY Targets Update
2028 Enterprise Goals and NJOY Targets Update 2028 Enterprise Goals Corporate U.S. Smoke-Free Products Long-Term Growth Financial Share of U.S. U.S. International Policy & Total Adjusted U.S. Tobacco Smoke-Free Smoke-Free Innovative Non-Nicotine Capital OCI Margin Space Volume Revenue Smoke-Free All
Slide 11: Conditions Needed to Rectify the Market
Conditions Needed to Rectify the Market We are looking for signs of material progress. A decline in the growth of illicit products A meaningful increase in the number of illicit products prevented from entering the U.S. The Department of Justice or State Attorneys General bringing litigation a
Slide 12: Our Corporate and Long-Term Growth Goals are Unchanged
Our Corporate and Long-Term Growth Goals are Unchanged 2028 Enterprise Goals Corporate U.S. Smoke-Free Products Long-Term Growth Financial Share of U.S. U.S. International Policy & Total Adjusted U.S. Tobacco Smoke-Free Smoke-Free Innovative Non-Nicotine Capital OCI Margin Space Volume Revenue Smoke
Slide 13: A Year of Growth and Progress for NJOY
A Year of Growth and Progress for NJOY Expanded distribution of ACE to over 100,000 stores; Secured premium positioning at retail in more than 80% of contracted stores; Executed trial generating activities with compelling results; and Introduced a new brand equity campaign with impactful con
Slide 14: NJOY Volume and Share Momentum
NJOY Volume and Share Momentum NJOY Shipment Volume NJOY Consumables Retail Share (in millions) (total U.S.) Consumables Devices +2.8pp 6.4 1.1 +22.2% 0.9 3.6 12.8 +15.3% 11.1 Q4 '23 Q4 '24 Q4 '23 Q4 '24 Source: Circana Projected Total U.S. MOC week ending 12/29/2024. 14 | ALCS | Q4 2024 | 1.30.25 |
Slide 15: NJOY Litigation
NJOY Litigation Yesterday, the ITC issued its final determination in JUUL Labs, Inc.’s case against NJOY. The ITC issued an exclusion order and cease-and-desist orders barring the importation and sale of ACE. The ITC’s decision is currently under a 60-day review period by the Office of the U.S.
Slide 16: 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 (six months ended) (cans in millions) +44.4% 8.0% 8.0% 43.9 30.4 1.5% 2022 2023 2024 Q4 '23 Q4 '24 Source: ALCS CMII estimates. Rounded to the nearest 0.5%. Oral tobacco industry includes MST,
Slide 17: on! Share Strength and Repeat Purchaser Growth
on! Share Strength and Repeat Purchaser Growth on! Share of Oral Tobacco Category on! Repeat Purchasers1 (total U.S.) +2.0pp >40% ~800K 8.9 ~550K 6.9 Q4 '23 Q4 '24 Q4 '23 Q4 '24 1Estimated numbers of ATCs 21+ that regularly purchase on! (e.g. 6+ weeks) Source: ALCS CMII estimates based on Circana Pr
Slide 18: 18 | ALCS | Q4 2024 | 1.30.25 | For Investor Purposes ONLY
18 | ALCS | Q4 2024 | 1.30.25 | For Investor Purposes ONLY
Slide 19: on! PLUS
on! PLUS Competing in Sweden and the United Kingdom at select retail and e-commerce ‘FLEX TECH’ pouch offers a unique product experience and we are encouraged by on! PLUS’ momentum Gaining valuable consumer and marketplace insights Launching two new flavors: Raspberry Lemon and Watermelon Mi
Slide 20: Continued Progress on Heated Tobacco Portfolio
Continued Progress on Heated Tobacco Portfolio All third-party trademarks remain the property of their respective owners. 20 | ALCS | Q4 2024 | 1.30.25 | For Investor Purposes ONLY
Slide 21: 2025 Financial Outlook
2025 Financial Outlook Our planned investment areas include: • Marketplace activities in support of our smoke-free products; and • Smoke-free product research, development and regulatory preparations. We expect to deliver full-year 2025 adjusted diluted EPS1 of $5.22 to $5.372,3. This range repr
Slide 22: 22 | ALCS | Q4 2024 | 1.30.25 | For Investor Purposes ONLY
22 | ALCS | Q4 2024 | 1.30.25 | For Investor Purposes ONLY
Slide 23: Smokeable Products Segment
Smokeable Products Segment Adjusted Operating Companies Income (OCI)* Fourth Quarter Full Year ($ in millions) ($ in millions) +5.5% +2.0% $10,710 $10,922 $2,709 (0.4) $2,568 Q4 '23 Q4 '24 FY 2023 FY 2024 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 23 | ALCS | Q4 2024 | 1.30.
Slide 24: Smokeable Products Segment
Smokeable Products Segment Adjusted OCI Margins* Fourth Quarter Full Year +2.2pp +1.7pp 61.2% 59.9% 61.6% 59.0% (0.4) Q4 '23 Q4 '24 FY 2023 FY 2024 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 24 | ALCS | Q4 2024 | 1.30.25 | For Investor Purposes ONLY
Slide 25: Adjusted Cigarette Decline Rates
Adjusted Cigarette Decline Rates Smokeable Segment Total Industry Q4 '23 Q4 '24 Q4 '23 Q4 '24 (9.0)% (11.0)% (8.0)% (8.0)% FY: (11.0)% FY: (9.0)% Source: ALCS CMII estimates – rounded to nearest 0.5%. Note: Estimates are subject to revision due to wholesaler resubmission of inventory data. 25 | ALCS
Slide 26: Cigarette Industry Volume Decomposition Estimates
Cigarette Industry Volume Decomposition Estimates Twelve Months Ended 3/31/24 6/30/24 9/30/24 12/31/24 Secular Decline Rate1 (2.5)% (2.5)% (2.5)% (2.5)% Cigarette Price Elasticity2 (1.8)% (1.9)% (2.0)% (2.1)% Macroeconomic, Cross Category Movement & (3.7)% (4.1)% (4.5)% (4.4)%3 Other Factors Estimat
Slide 27: Discount Retail Share
Discount Retail Share Branded Discount (Major Manufacturers) Deep Discount (All Other) 29.8 30.4 28.7 29.1 29.3 15.4 15.5 15.3 15.3 15.3 13.8 14.0 14.4 14.9 13.4 Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 Note: Discount sequential share from Q3’24 to Q4’24 was +0.6pp vs. the 5-year average sequential change
Slide 28: Marlboro Retail Share and Share of Premium
Marlboro Retail Share and Share of Premium Marlboro Retail Share1 Marlboro Share of Premium (1.0pp) +0.1pp 59.3 59.4 42.3 41.3 Q4 '23 Q4 '24 Q4 '23 Q4 '24 1Sequential share change from Q3’24 to Q4’24 was (0.3pp) vs. the 5-year average sequential change of (0.2pp). Source: Circana InfoScan Cigarette
Slide 29: John Middleton Cigars
John Middleton Cigars Reported Shipment Volume (in millions) +2.9% 419 431 Q4 '23 Q4 '24 29 | ALCS | Q4 2024 | 1.30.25 | For Investor Purposes ONLY
Slide 30: Oral Tobacco Products Segment
Oral Tobacco Products Segment Adjusted OCI* and Adjusted OCI Margins* Adjusted OCI Adjusted OCI Margins ($ in millions) +13.0% +6.4pp $461 69.5% 63.1% $408 Q4 '23 Q4 '24 Q4 '23 Q4 '24 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 30 | ALCS | Q4 2024 | 1.30.25 | For Investor Pur
Slide 31: Oral Tobacco Products Segment Volume and Share
Oral Tobacco Products Segment Volume and Share Reported Shipment Volume Retail Share (in millions) MST on! MST on! (0.4%) (3.1pp) 39.9 193.1 192.3 36.8 30.4 6.9 43.9 8.9 162.7 33.0 148.4 27.9 Q4 '23 Q4 '24 Q4 '23 Q4 '24 Source: Circana InfoScan Cigarette 2024-Blended, week ending 12/29/2024. 31 | AL
Slide 32: ABI Investment
ABI Investment All third-party trademarks remain the property of their respective owners. 32 | ALCS | Q4 2024 | 1.30.25 | For Investor Purposes ONLY
Slide 33: Committed to Long-Term Value for Our Investors
Committed to Long-Term Value for Our Investors Cash Returned to Shareholders 2024 $10.2 B Dividend Increase Debt-to-EBITDA* Share Repurchases $3.4 B +4.1% 2.1x 2025 Dividends $6.8 B New Share Repurchase Program $1 Billion 2024 *For the Twelve Months Ended December 31, 2024. For reconciliations of no
Slide 34: 34 ALCS | Q4 2024 | 1.30.25 | For Investor Purposes ONLY
34 ALCS | Q4 2024 | 1.30.25 | For Investor Purposes ONLY All new products subject to FDA authorization. Third-party trademarks remain the property of their respective owners.