Slide 1: Altria's Second-Quarter and First-Half 2024 Earnings Conference Call
Altria’s Second-Quarter and First-Half 2024 Earnings Conference Call July 31, 2024 1 | ALCS | Q2 2024 | 7.31.24 | 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 | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
3 | ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
Slide 4: Agenda
Agenda NJOY’s encouraging second-quarter results; The state of the e-vapor category; Strong second-quarter results from on!; and Our financial results and traditional tobacco business performance. 4 | ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
Slide 5: NJOY Progress During Our First Year of Ownership
NJOY Progress During Our First Year of Ownership Strengthened NJOY’s supply chain; Tripled NJOY’s footprint to over 100,000 stores; Secured premium positioning at retail; Launched a variety of trial generating activities; and Introduced a new brand equity campaign. 5 | ALCS | Q2 2024 | 7.3
Slide 6: NJOY Volume Momentum
NJOY Volume Momentum NJOY Shipment Volume (in millions) Consumables Devices 14.3 1.8 11.9 1.0 12.5 10.9 Q1 '24 Q2 '24 6 | ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
Slide 7: Compelling NJOY Share Growth
Compelling NJOY Share Growth NJOY Consumables Retail Share NJOY Device Share (total U.S.) (total U.S.) +1.3pp +13.8pp 25.4 5.5 4.2 11.6 Q1 '24 Q2 '24 Q1 '24 Q2 '24 Source: Circana Projected Total U.S. MOC week ending 6/30/2024. 7 | ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
Slide 8: Investing Behind NJOY
Investing Behind NJOY At retail, approximately two-thirds of fixture resets are now complete. Amplified NJOY’s visibility and secured premium positioning through its trade program. Reaching increased numbers of adult consumers through NJOY’s events infrastructure and digital marketing capabili
Slide 9: NJOY Menthol FDA Marketing Authorizations
NJOY Menthol FDA Marketing Authorizations NJOY received marketing granted orders for four menthol e-vapor products - the first and only menthol e-vapor products authorized by the FDA. As negotiated under the terms of the acquisition, upon receiving the marketing granted orders, we made cash paym
Slide 10: Illicit Products Driving E-Vapor Category Growth
Illicit Products Driving E-Vapor Category Growth Adult Vapers 21+ - Past 30-Day Usage Vapers by Cigarette Usage Vapers by Form (twelve months ended, in millions) (twelve months ended, in millions) Exclusive Vapers Vapers Who Also Smoke Cigarettes Disposable All Other Forms 18.6 18.6 15.5 15.5 13.0 1
Slide 11: Increased Illicit Activity Across Multiple Tobacco Categories
Increased Illicit Activity Across Multiple Tobacco Categories We are beginning to see increased illicit activity across multiple tobacco categories, including nicotine pouches and cigarettes. The FDA’s inaction, lack of enforcement and slow- pace of smoke-free authorizations continues to enable
Slide 12: Some Positive Enforcement Actions Against Illicit E-Vapor
Some Positive Enforcement Actions Against Illicit E-Vapor In June, the Justice Department and the FDA announced the creation of a federal multi-agency task force. We have been advocating for multi-agency collaboration and view this announcement as a much-needed course-correction. States continue
Slide 13: 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) +37.3% 41.2 9.0% 30.0 3.0% 6/30/2022 6/30/2023 6/30/2024 Q2 '23 Q2 '24 Source: ALCS CMII estimates. Rounded to the nearest 0.5%. Oral tobacco in
Slide 14: Helix Investing Strategically and Responsibly Behind on!
Helix Investing Strategically and Responsibly Behind on! Launched a new trade program that secured the number one retail fixture position for nearly 80% of on!’s volume. Introduced a fresh new look for on! packaging and a new equity campaign -- “IT’S ON!” -- to further differentiate the brand. 1
Slide 15: Consistent on! Share Momentum
Consistent on! Share Momentum on! Share of Oral Tobacco Category (total U.S.) +1.2pp 8.1% 6.9% Q2 '23 Q2 '24 Source: ALCS CMII estimates based on Circana Projected Total U.S. MOC data week ending 6/30/2024. 15 | ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
Slide 16: Exciting on! PLUS Growth Prospects
Exciting on! PLUS Growth Prospects Early international results continue to show that on! PLUS is a growing competitive player in the nicotine pouch space in Sweden and the United Kingdom. In both markets, on! PLUS has been incremental to our total portfolio. Consumers enjoy the innovative on!
Slide 17: PMTAs Submitted to the FDA for on! PLUS
PMTAs Submitted to the FDA for on! PLUS Note: Product packaging design is subject to change. 17 | ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
Slide 18: 18 | ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
18 | ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
Slide 19: Adjusted Diluted EPS and Financial Outlook
Adjusted Diluted Earnings Per Share (EPS)* and Financial Outlook Second Quarter First Half - (1.6)% $2.50 $2.46 $1.31 $1.31 Q2 '23 Q2 '24 1H '23 1H '24 We are narrowing our full-year 2024 guidance range and now expect to deliver adjusted diluted EPS in a range of $5.07 to $5.15, representing a growt
Slide 20: Cigarette Industry Volume Decomposition Estimates
Cigarette Industry Volume Decomposition Estimates Twelve Months Ended 9/30/23 12/31/23 3/31/24 6/30/24 Secular Decline Rate1 (2.5)% (2.5)% (2.5)% (2.5)% Cigarette Price Elasticity2 (1.9)% (1.9)% (1.8)% (1.9)% Macroeconomic, Additional Cross (4.1)% (3.6)% (3.7)% (4.1)%3 Category Movement & Other Fact
Slide 21: Smokeable Products Segment
Smokeable Products Segment Adjusted Operating Companies Income* (OCI) Second Quarter First Half ($ in millions) ($ in millions) (2.0%) (2.3%) $5,401 $5,278 $2,886 $2,827 (0.4) Q2 '23 Q2 '24 1H '23 1H '24 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 21 | ALCS | Q2 2024 | 7.31.2
Slide 22: Smokeable Products Segment
Smokeable Products Segment Adjusted OCI Margins* Second Quarter First Half +1.2pp +0.6pp 60.4% 61.6% 60.4% 61.0% (0.4) Q2 '23 Q2 '24 1H '23 1H '24 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 22 | ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
Slide 23: Marlboro Retail Share and Share of Premium
Marlboro Retail Share and Share of Premium Marlboro Retail Share Marlboro Share of Premium (0.1pp) +0.7pp 58.7% 59.4% 42.1% 42.0% Q2 '23 Q2 '24 Q2 '23 Q2 '24 Source: Circana InfoScan Cigarette 2024-Blended, week ending 6/30/2024. 23 | ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
Slide 24: Adjusted Cigarette Decline Rates
Adjusted Cigarette Decline Rates Smokeable Segment Total Industry Q2 '23 Q2 '24 Q2 '23 Q2 '24 (7.5%) (9.5%) (10.0%) (11.0%) 1H: (10.5%) 1H: (9.0%) Source: ALCS CMII estimates – rounded to nearest 0.5%. Note: Estimates are subject to revision due to wholesaler resubmission of inventory data. 24 | ALC
Slide 25: Discount Retail Share
Discount Retail Share Branded Discount (Major Manufacturers) Deep Discount (All Other) 28.7 29.1 29.3 27.8 28.3 28.3 28.3 15.3 15.3 15.3 15.5 15.5 15.4 15.3 12.8 12.9 13.0 13.4 13.8 14.0 12.4 Q4 '22 Q1 '23 Q2 '23 Q3 '23 Q4 '23 Q1 '24 Q2 '24 Source: Circana InfoScan Cigarette 2024-Blended, week endin
Slide 26: John Middleton Cigars
John Middleton Cigars Reported Shipment Volume (0.9%) 466 462 Q2 '23 Q2 '24 26 | ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
Slide 27: Oral Tobacco Products Segment
Oral Tobacco Products Segment Adjusted OCI* and Adjusted OCI Margins* Adjusted OCI Adjusted OCI Margins ($ in millions) +1.8% (2.4pp) $443 $451 68.0% 65.6% Q2 '23 Q2 '24 Q2 '23 Q2 '24 *For reconciliations of non-GAAP to GAAP measures visit altria.com. 27 | ALCS | Q2 2024 | 7.31.24 | For Investor Pur
Slide 28: Oral Tobacco Products Segment Retail Share
Oral Tobacco Products Segment Retail Share Retail Share MST + Snus on! (5.8pp) 43.7% 6.9 37.9% 8.1 36.8 29.8 Q2 '23 Q2 '24 Source: Circana InfoScan Oral Tobacco 2024-Blended week ending 6/30/2024. 28 | ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
Slide 29: ABI Investment
ABI Investment All third-party trademarks remain the property of their respective owners. 29 | ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
Slide 30: Capital Allocation - Dividends and Balance Sheet
Capital Allocation - Dividends and Balance Sheet • Completed $2.4 billion accelerated share repurchase program. Share Repurchase • Approximately $1 billion remaining under our currently authorized share repurchase program. Dividends • Paid approximately $3.4 billion in dividends in the first-half. D
Slide 31: 31 ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY
31 ALCS | Q2 2024 | 7.31.24 | For Investor Purposes ONLY All new products subject to FDA authorization. Third-party trademarks remain the property of their respective owners.