Slide 1: Altria's Fourth-Quarter 2023 Earnings Conference Call
Altria’s Fourth-Quarter 2023 Earnings Conference Call February 1, 2024 1 | ALCS | Q4 2023 | 2.1.24 | 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: Strong Performance & Cash Returns to Shareholders
Strong Performance & Cash Returns to Shareholders Adjusted Diluted Earnings Per Share (EPS)* Cash Returned to Shareholders ($ in billions) +2.3% $4.95 $8.4 $4.84 $8.1 $7.8 $6.9 $6.3 FY 2022 FY 2023 2019 2020 2021 2022 2023 *For reconciliations of non-GAAP to GAAP measures visit altria.com. $37.5 Bil
Slide 4: 2023 Progress Toward Our Vision
2023 Progress Toward Our Vision • Completing our acquisition of NJOY and fully integrating it into our family of companies; • Making exciting progress on our smoke-free pipeline, including launching on! PLUS internationally; • Continuing preparations to bring heated tobacco products to the market; a
Slide 5: Nicotine Space Estimated Volume
Nicotine Space Estimated Volume Volume in Billions of Equivalized Cigarette Packs +1.0% CAGR 16.8 16.6 15.8 16.0 16.1 15.5 2018 2019 2020 2021 2022 2023 Sources: CMII Estimates; ALCS Adult Tobacco Consumer Tracker; STARS; Circana; ALCS Consumer Research; External Sources EQ Estimation – For purposes
Slide 6: Nicotine Space Estimated Volume
Nicotine Space Estimated Volume Volume in Billions of Equivalized Cigarette Packs Combustible Oral Tobacco E-Vapor +1.0% CAGR 16.8 16.6 15.8 16.0 16.1 15.5 ~20% ~40% 2018 2019 2020 2021 2022 2023 Sources: CMII Estimates; ALCS Adult Tobacco Consumer Tracker; STARS; Circana; ALCS Consumer Research; Ex
Slide 7: NJOY – Initial Progress
NJOY – Initial Progress Cumulative # of Stores Receiving Strengthened NJOY’s supply chain. We expect to have (Thousands) the needed capacity to support expansion plans for NJOY +115% moving forward. 75 Closed inventory gaps at retail, which has significantly improved in-stock conditions. Grew
Slide 8: NJOY's First Retail Trade Program
NJOY’s First Retail Trade Program We introduced NJOY’s first retail trade program, which we believe will help NJOY achieve optimal visibility and product fixture space at retail. Merchandising options designed to position NJOY strategically and responsibly to tobacco consumers. Approximately 7
Slide 9: NJOY Share Momentum
NJOY Share Momentum NJOY Share Performance (total U.S.) NJOY Bundle Offer Test 4.0 3.7 3.3 3.4 Sept '23 Oct '23 Nov '23 Dec '23 Source: Circana Projected Total U.S. MOC week ending 12/31/2023 9 | ALCS | Q4 2023 | 2.1.24 | For Investor Purposes ONLY
Slide 10: State of the E-Vapor Market
State of the E-Vapor Market The total nicotine space grew in 2023, largely because of illegal flavored disposable e-vapor products. These products are being distributed by companies violating virtually every rule and guidance the U.S. Food and Drug Administration (FDA) has issued since 2016. W
Slide 11: State of the E-Vapor Market
State of the E-Vapor Market The FDA, in collaboration with U.S. Customs and Border Protection, announced the seizure of approximately 1.4 million unauthorized e-vapor products. A number of states have passed or are considering legislation limiting what e-vapor products can be sold at retail. W
Slide 12: 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) 7.5% +32.8% 30.4 22.9 2.0% 1.0% 12/31/2021 12/31/2022 12/31/2023 Q4 '22 Q4 '23 Source: ALCS CMII Estimates. Rounded to the nearest 0.5%. Oral To
Slide 13: Share Momentum and Continued Brand Adoption
Share Momentum and Continued Brand Adoption on! Share of Oral Tobacco Category on! Retail Sales Volume (total U.S.) (cans in millions) +1.1pp Estimated Repeat Purchase Estimated Trial 29 6.9 4 5.8 22 3 25 19 Q4 '22 Q4 '23 Q4 '22 Q4 '23 Source: CMII Estimates based on Circana Projected (MOC) data as
Slide 14: on! PLUS Test Launch in Sweden
on! PLUS Test Launch in Sweden Our New Tobacco-Derived Nicotine Wet Pouch Product Consumers indicate that on! PLUS is competitive with the market leader in Sweden and seen as a unique offering. In December, we introduced on! PLUS Berry and Citrus in the e-commerce channel. We are on track to s
Slide 15: Continued Progress on Heated Tobacco Portfolio
Continued Progress on Heated Tobacco Portfolio All third-party trademarks remain the property of their respective owners. 15 | ALCS | Q4 2023 | 2.1.24 | For Investor Purposes ONLY
Slide 16: 2028 Enterprise Goals
2028 Enterprise Goals 2028 Enterprise Goals Corporate U.S. Smoke-Free Products Long-Term Growth Financial International Share of U.S. U.S. Policy & Total Adjusted Innovative Non-Nicotine U.S. Tobacco Smoke-Free Smoke-Free Capital OCI Margin Smoke-Free Revenue Space Volume Revenue Allocation Revenue
Slide 17: 2024 Financial Outlook
2024 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 2024 adjusted diluted EPS1 of $5.00 to $5.152,3. This range repr
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Slide 19: Continued Macroeconomic Headwinds
Continued Macroeconomic Headwinds Weekly Retail Gasoline Prices Outstanding Consumer Debt ($ per Gallon) $5.50 +8.4% $2.00 Jul-23 Jan-23 Jun-23 Mar-23 Feb-23 Nov-22 Dec-22 Aug-23 Sep-23 Nov-23 Dec-23 Oct-22 Oct-23 Apr-23 May-23 Q4 '22 Q1 '23 Q2 '23 Q3 '23 Q4 '23 Source: U.S. Energy Information Admin
Slide 20: Smokeable Products Segment
Smokeable Products Segment Adjusted Operating Companies Income* (OCI) Q4: Adjusted OCI Full Year: Adjusted OCI ($ in millions) ($ in millions) (1.3)% (0.1)% $10,726 $10,710 $2,603 $2,568 Q4 '22 Q4 '23 2022 2023 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 20 | ALCS | Q4 2023 |
Slide 21: Smokeable Products Segment
Smokeable Products Segment Adjusted OCI Margins* Q4: Adjusted OCI Margins Full Year: Adjusted OCI Margins +0.6pp +0.9pp 58.4% 59.0% 59.0% 59.9% Q4 '22 Q4 '23 2022 2023 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 21 | ALCS | Q4 2023 | 2.1.24 | For Investor Purposes ONLY
Slide 22: Marlboro Share Stability
Marlboro Share Stability Marlboro Retail Share Marlboro Share Of Premium 59.2 58.9 58.5 58.6 58.4 42.2 42.3 42.2 42.0 42.0 Q4 '22 Q1 '23 Q2 '23 Q3 '23 Q4 '23 Q4 '22 Q1 '23 Q2 '23 Q3 '23 Q4 '23 Source: Circana Info Scan Cigarette 2023 – Blended WE 12/31/2023 22 | ALCS | Q4 2023 | 2.1.24 | For Investo
Slide 23: Discount Retail Share
Discount Retail Share Branded Discount (Major Manufacturers) Deep Discount (All Other) +0.6pp +0.4pp 28.2 28.2 28.2 28.6 27.1 27.7 15.5 15.4 15.3 15.2 15.3 15.4 12.3 12.7 12.8 12.9 13.4 11.8 Q3 '22 Q4 '22 Q1 '23 Q2 '23 Q3 '23 Q4 '23 Source: Circana Info Scan Cigarette 2023 – Blended WE 12/31/2023 23
Slide 24: Adjusted Cigarette Decline Rates
Adjusted Cigarette Decline Rates Smokeable Products Segment Total Industry Q4 '22 Q4 '23 Q4 '22 Q4 '23 (8.0)% (9.0)% (9.0)% (11.0)% Full Year: (10.0)% Full Year: (8.0)% Source: ALCS CMII estimates – rounded to nearest 0.5% Note: Estimates are subject to revision due to wholesaler resubmission of inv
Slide 25: John Middleton Cigars
John Middleton Cigars Reported Shipment Volume +2.8% 1,780 1,731 2022 2023 25 | ALCS | Q4 2023 | 2.1.24 | For Investor Purposes ONLY
Slide 26: Q4: Oral Tobacco Products Segment
Q4: Oral Tobacco Products Segment Adjusted OCI* and Adjusted OCI Margins* Adjusted OCI Adjusted OCI Margins ($ in millions) +10.3% +1.8pp 61.3% 63.1% $408 $370 Q4 '22 Q4 '23 Q4 '22 Q4 '23 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 26 | ALCS | Q4 2023 | 2.1.24 | For Investor
Slide 27: Oral Tobacco Products Segment
Oral Tobacco Products Segment Retail Share MST + Snus on! 45.9 5.8 40.1 6.9 40.1 33.2 Q4 '22 Q4 '23 Source: Circana Info Scan Oral Tobacco 2023 - MOC, WE 12/31/23 27 | ALCS | Q4 2023 | 2.1.24 | For Investor Purposes ONLY
Slide 28: ABI Investment
ABI Investment All third-party trademarks remain the property of their respective owners. 28 | ALCS | Q4 2023 | 2.1.24 | For Investor Purposes ONLY
Slide 29: Creating Long-Term Shareholder Value
Creating Long-Term Shareholder Value Cash Returned to Shareholders Raised our dividend per share by 4.3%, in-line $7.8 B with our new progressive dividend goal. Share $1.0 B Repurchases Repurchased 22.7 million shares, which completed our previously authorized $1 billion program. As of Decembe
Slide 30: All new products subject to FDA authorization
All new products subject to FDA authorization. Third-party trademarks remain the property of their respective owners.