Altria Group, Inc. · NYSE:MO

Altria — Investor Day (June 2015)

181 slides from Altria's investor day presentation, Jun 23, 2015

1. Slide 1: Investor Day

   Investor Day June 23, 2015 For Investor Relations Purposes Only

2. 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

3. Slide 3: Altria IR App

   Altria IR App Note: Third-party trademarks are the property of their respective owners and are included for informational purposes only. For Investor Relations Purposes Only

4. Slide 4: Agenda

   Agenda  Introduction and Overview  Financial Update  Consumer Engagement and Sales and Distribution Capability  Questions and Answers  Break  Panel Discussion: Navigating the External Environment  Investing in Premium Brands: Focus on Marlboro  Questions and Answers  Lunch: The Marlboro Exp

5. Slide 5: Other Team Members

   Other Team Members OpCo Presidents AGDC Marlboro Brand For Investor Relations Purposes Only

6. Slide 6: For Investor Relations Purposes Only

   For Investor Relations Purposes Only

7. Slide 7: This space is blank because brand images which appeared in the original presentation have

   This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

8. Slide 8: For Investor Relations Purposes Only

   For Investor Relations Purposes Only

9. Slide 9: Recognized as a Best Employer

   Recognized as a Best Employer Note: Third-party trademarks are the property of their respective owners and are included for informational purposes only. For Investor Relations Purposes Only

10. Slide 10: This space is blank because brand images which appeared in the original presentation have

    This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

11. Slide 11: Altria's Goals

    Altria’s Goals  Grow adjusted diluted EPS at an average annual Long-term rate of 7% to 9% Financial Goals  Maintain a target dividend payout ratio of approximately 80% of adjusted diluted EPS For Investor Relations Purposes Only

12. Slide 12: Consistent Adjusted Diluted EPS Growth

    Consistent Adjusted Diluted EPS* Growth +8.0% CAGR $2.57 $1.75 2009 2014 *For reconciliation of non-GAAP to GAAP measures visit altria.com Source: Altria company reports For Investor Relations Purposes Only

13. Slide 13: Dividend Payout Ratio

    Dividend Payout Ratio S&P Food, Beverage and Tobacco Index MO 80.9% PM 79.7% RAI 78.4% LO 73.2% KRFT 69.8% GIS 60.7% KO 59.8% PEP 56.6% HSY 53.8% DPS 52.6% NOTE: Altria’s dividend payout ratio is based on the current annualized dividend (Last increased August 2014) of $2.08 / $2.57 2014 adjusted dil

14. Slide 14: An Attractive Dividend Yield

    An Attractive Dividend Yield 4.4% Altria’s dividend yield was higher than virtually 2.4% 2.0% all S&P Food, Beverage and Tobacco peers. Altria 10-year U.S. S&P 500 Treasury Note: As of June 15, 2015 Source: Bloomberg, Standard and Poor's For Investor Relations Purposes Only

15. Slide 15: Strong Dividend Growth

    Strong Dividend Growth +8.9% CAGR 8.3% $2.08 $2.10 9.1% 7.9% 7.3% $1.36 2.9% 8.6% $0.00 2009 Feb-10 Aug-10 Aug-11 Aug-12 Aug-13 Aug-14 2014 Altria increased its dividend 48 times in the past 45 years. Note: Year-end annualized rate: 5-year CAGR. Dividend is based on the current annualized dividend (

16. Slide 16: Remarkable Record of Value Creation

    Remarkable Record of Value Creation $510,000 $32,000 $360 1970 S&P 500 Altria (through Mar 2015) (through Mar 2015) Note: Includes spin-offs and dividend reinvestment Source: Bloom Partners For Investor Relations Purposes Only

17. Slide 17: Our Financial Heritage

    Our Financial Heritage Note: Third-party trademarks are the property of their respective owners and are included for informational purposes only. Source: CNN Money For Investor Relations Purposes Only

18. Slide 18: Total Shareholder Return 2010-2014

    Total Shareholder Return 2010-2014 230% 105% 116% Altria Group S&P 500 S&P Food, Beverage & Tobacco Note: Total shareholder return is simple price appreciation plus the reinvestment of the dividend as of the ex-dividend date. Source: Bloomberg 12/31/2009-12/31/2014 For Investor Relations Purposes On

19. Slide 19: Altria's Strategies

    Altria’s Strategies Maximize income from core premium tobacco businesses over the long term Grow new income streams with innovative tobacco products Manage diverse income streams and strong balance sheet to deliver consistent financial performance For Investor Relations Purposes Only

20. Slide 20: Altria's Strategies

    Altria’s Strategies Maximize income from core premium tobacco businesses over the long term Grow new income streams with innovative tobacco products Manage diverse income streams and strong balance sheet to deliver consistent financial performance For Investor Relations Purposes Only

21. Slide 21: Altria's Strategies

    Altria’s Strategies Maximize income from core premium tobacco businesses over the long term Grow new income streams with innovative tobacco products Manage diverse income streams and strong balance sheet to deliver consistent financial performance For Investor Relations Purposes Only

22. Slide 22: Smokeable Products Segment

    Smokeable Products Segment This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

23. Slide 23: Smokeable Products Income Growth

    Smokeable Products Income Growth Adjusted OCI* - $ in Billions Adjusted OCI* Margins +4.4% +3.8pp CAGR 44.1% $6.9 40.3% $6.0 2011 2014 2011 2014 *For reconciliation of non GAAP to GAAP measures visit altria.com Source: Altria company reports For Investor Relations Purposes Only

24. Slide 24: Smokeable Products Income Growth

    Smokeable Products Income Growth Adjusted OCI* - $ in Billions Adjusted OCI* Margins +12.6% +2.3pp $1.7 46.4% 44.1% $1.5 Q1 2014 Q1 2015 Q1 2014 Q1 2015 *For reconciliation of non GAAP to GAAP measures visit altria.com Source: Altria company reports For Investor Relations Purposes Only

25. Slide 25: This space is blank because brand images which appeared in the original presentation have

    This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

26. Slide 26: Marlboro Retail Share Leadership

    Marlboro Retail Share Leadership 44% Next 10 Largest Cigarette Brands = 43% Marlboro Source: IRI/MSAi, Cigarettes ending 3/31/15 For Investor Relations Purposes Only

27. Slide 27: Cigarette Retail Share Leadership

    Cigarette Retail Share Leadership Q1 2015 51% This space is blank because brand images which appeared in the original presentation have been removed. PM USA Source: Period ending 3/31/15; IRI/MSAi For Investor Relations Purposes Only

28. Slide 28: This space is blank because brand images which appeared in the original presentation have

    This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

29. Slide 29: Smokeless Products Adjusted OCI Growth

    Smokeless Products Adjusted OCI* Growth $ in Millions +5.8% CAGR $1,060 $896 2011 2014 *For reconciliation of non GAAP to GAAP measures visit altria.com Source: Altria company reports For Investor Relations Purposes Only

30. Slide 30: Smokeless Products Segment Performance

    Smokeless Products Segment Performance  Leading premium brands with over 51% retail share  Adjusted OCI* margins over 60% *For reconciliation of GAAP to non-GAAP measures visit altria.com Source: Altria company reports as of Q1 2015 For Investor Relations Purposes Only

31. Slide 31: This space is blank because brand images which appeared in the original presentation have

    This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

32. Slide 32: Altria's Strategies

    Altria’s Strategies Maximize income from core premium tobacco businesses over the long term Grow new income streams with innovative tobacco products Manage diverse income streams and strong balance sheet to deliver consistent financial performance For Investor Relations Purposes Only

33. Slide 33: Harm Reduction Progress

    Harm Reduction Progress ~90% This space is blank ~60% because brand images which appeared in the original presentation have been removed. Awareness Trial Many elements are in place to make our harm reduction vision a reality. For Investor Relations Purposes Only

34. Slide 34: Approach to Tobacco Products and Technologies

    Approach to Tobacco Products and Technologies  Products, distribution and brand-building  Optimizing supply chain  Partnering with PMI We’re applying our substantial capabilities to succeed in the long term. For Investor Relations Purposes Only

35. Slide 35: Approach to Tobacco Products and Technologies

    Approach to Tobacco Products and Technologies • Developing regulatory science • Engaged in the modified-risk tobacco product application process For Investor Relations Purposes Only

36. Slide 36: Long-Term Adjusted Diluted EPS Performance

    Long-Term Adjusted Diluted EPS* Performance 8.6% 7.9% 7.8% 7.7% 8.0% 2010 2011 2012 2013 2014 *For reconciliation of non-GAAP to GAAP measures visit altria.com Note: Year-over-year percent change Source: Altria company reports For Investor Relations Purposes Only

37. Slide 37: This space is blank because brand images which appeared in the original presentation have

    This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

38. Slide 38: An Ever-Changing Industry

    An Ever-Changing Industry 1998 2009 Master Settlement Federal Excise Tax Increase Agreement signed FDA Regulation enacted 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2004 RJ Reynolds and Brown & Williamson Tobacco merge For Investor Relations Purposes Only

39. Slide 39: Marlboro Long-Term Performance

    Marlboro Long-Term Performance +6.9pp 43.8 36.9 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Marlboro Camel Winston Newport Note: IRI/MSAi was implemented to read market share in 2011. Share prior to that reflects estimates based on share changes derived from

40. Slide 40: Total Shareholder Return 1998-2014

    Total Shareholder Return 1998-2014 1,081% 330% 190% Altria Group S&P 500 S&P Food, Beverage & Tobacco Note: Total shareholder return is simple price appreciation plus the reinvestment of the dividend as of the ex-dividend date. Excludes spin-offs. Source: Bloomberg 12/31/1997-12/31/2014 For Investor

41. Slide 41: For Investor Relations Purposes Only

    For Investor Relations Purposes Only

42. Slide 42: Altria's Strategies

    Altria’s Strategies Maximize income from core premium tobacco businesses over the long term Grow new income streams with innovative tobacco products Manage diverse income streams and strong balance sheet to deliver consistent financial performance For Investor Relations Purposes Only

43. Slide 43: Agenda

    Agenda  Diverse business model  Strong balance sheet  Productivity efforts Long-term Financial Goals  Grow adjusted diluted EPS at an average annual rate of 7% to 9%  Maintain a target dividend payout ratio of approximately 80% of adjusted diluted EPS For Investor Relations Purposes Only

44. Slide 44: Diverse Business Model

    Diverse Business Model 27% Economic Interest Note: Third-party trademarks are the property of their respective owners and are included for informational purposes only. For Investor Relations Purposes Only

45. Slide 45: U.S. Tobacco Manufacturers' Profit Pool

    U. S. Tobacco Manufacturers’ Profit Pool $ in Billions +5.5% CAGR $15.5 $11.8 2009 2014 Source: ALCS estimates; other public company reports For Investor Relations Purposes Only

46. Slide 46: 2014 Share of the U.S. Tobacco Profit Pool

    2014 Share of the U.S. Tobacco Profit Pool 51% 22% 14% 12% Altria Reynolds American Lorillard Other Note: Altria’s Profit Pool share is calculated by combining the adjusted OCI* for Altria’s Smokeable & Smokeless Products segments divided by Total Profit Pool. *For reconciliation of non-GAAP to GAAP

47. Slide 47: Alcohol Assets

    Alcohol Assets Note: Third-party trademarks are the property of their respective owners and are included for informational purposes only. For Investor Relations Purposes Only

48. Slide 48: Ste. Michelle Wine Estates Strategy

    Ste. Michelle Wine Estates Strategy Grow income by expanding its share and distribution of premium wines. For Investor Relations Purposes Only

49. Slide 49: Ste. Michelle Wine Estates

    Ste. Michelle Wine Estates For Investor Relations Purposes Only

50. Slide 50: Ste. Michelle Wine Estates

    Ste. Michelle Wine Estates Note: Third-party trademarks are the property of their respective owners and are included for informational purposes only. For Investor Relations Purposes Only

51. Slide 51: Ste. Michelle Wine Estates

    Ste. Michelle Wine Estates Adjusted OCI* - $ in Millions Adjusted OCI* Margins +12.9% CAGR +2.7pp $134 21.6% 18.9% $73 2009 2014 2009 2014 * For reconciliations of non-GAAP to GAAP measures visit www.altria.com Source: Altria company reports For Investor Relations Purposes Only

52. Slide 52: Note: trademarks their

    Note: Note: Third-party trademarks are the property of Third-party trademarks their respective ownersare andthe areproperty includedoffor their respective owners informational and purposes are included for informational purposes only. only. For Investor Relations Purposes Only

53. Slide 53: Global Beer Profit Pool

    Global Beer Profit Pool $ in Billions +4.1% CAGR $36.2 $32.1 2012 2015 Source: Bank of America Merrill Lynch Global Research Note: Third-party trademarks are the property of their respective owners and are included for informational purposes only. For Investor Relations Purposes Only

54. Slide 54: SABMiller Strong Income Growth

    SABMiller Strong Income Growth Equity Earnings - $ in Millions +10.9% CAGR $1,006 $600 2009 2014 In 2014, Altria recorded pre-tax earnings of more than $1 billion. Source: Altria company reports For Investor Relations Purposes Only

55. Slide 55: SABMiller Market Value

    SABMiller Market Value $ in Billions $22.1 $3.4 Jul-02 Jun-15 Note: Third-party trademarks are the property of their respective owners and are included for informational purposes only. Source: Bloomberg as of June 15, 2015 For Investor Relations Purposes Only

56. Slide 56: Note: Third-party trademarks are the property of their respective owners and are included for

    Note: Third-party trademarks are the property of their respective owners and are included for informational purposes only. For Investor Relations Purposes Only

57. Slide 57: Philip Morris Capital Corporation

    Philip Morris Capital Corporation Net Finance Receivable - $ in Millions Year-end Portfolio (# of Lessees/Transactions) $9.4 61 55 49 38 29 24 $1.7 2002 2014 2009 2010 2011 2012 2013 2014 Note: Net Finance Receivable reflects PMCC’s investments in finance leases excluding the allowance for losses. S

58. Slide 58: Strong Balance Sheet

    Strong Balance Sheet  Manage difficult capital market conditions  Make acquisitions  Manage our debt maturity towers  Return cash to shareholders Our strong BBB+ credit rating allows us to competitively access the capital markets to cover short-term cash needs. Note: Third-party trademarks are t

59. Slide 59: Strong Balance Sheet

    Strong Balance Sheet  Debt covenant of not more than 3 to 1 Debt-to-EBITDA*  $1 billion in long-term debt coming due in September 2015 1.7x Mar 2015 Note: Debt to EBITDA calculated in accordance with credit agreements. *For reconciliation of non-GAAP to GAAP measures visit altria.com Source: Altri

60. Slide 60: Dividend Growth

    Dividend Growth $ per Share +8.9% CAGR $2.08 $1.36 Aug-09 Aug-14 In 2014, we paid shareholders $3.9 billion in dividends. Note: Dividend is based on the current annualized dividend (Last increased August 2014) Source: Altria company reports For Investor Relations Purposes Only

61. Slide 61: Share Repurchase Programs

    Share Repurchase Programs $ in Billions $4.2 Mar 2011 – Mar 2015 Through recent share repurchase programs, we reduced outstanding shares by ~6%. Note: From March 31, 2011 through March 31, 2015 Source: Altria company reports For Investor Relations Purposes Only

62. Slide 62: Share Repurchase Programs

    Share Repurchase Programs Mar 2011 – Mar 2015 $50.02 $32.89 Average Share Repurchase Price Altria Share Price At the end of the first quarter, we had $326 million remaining in our $1 billion share repurchase program. Note: Altria Share Price as of March 31, 2015. $32.89 represents weighted average s

63. Slide 63: Returning Cash to Shareholders

    Returning Cash to Shareholders $ in Billions $22.3 $4.2 Share Repurchase $18.1 Dividend Jan 2010 – Mar 2015 Source: Altria company reports For Investor Relations Purposes Only

64. Slide 64: Improving Productivity

    Improving Productivity ~$2 Billion This space is blank because brand images which appeared in the original presentation have been removed. 2007 - 2013 Source: ALCS For Investor Relations Purposes Only

65. Slide 65: Improving Productivity

    Improving Productivity  Improved efficiency of manufacturing machinery  Standardized technology systems to reduce maintenance costs  Redesigned 100+ processes  Eliminated more than 18,000 hours of work Note: Third-party trademarks are the property of their respective owners and are included for

66. Slide 66: Smokeable Products Cost Management

    Smokeable Products Cost Management Controllable Costs/1000 Units* FETRA Expense Savings - $ in Millions +0.6% CAGR $28.73 $29.57 ~$300 ~$100 2009 2014 2014 2015 * For reconciliations of non-GAAP to GAAP measures visit www.altria.com Note: FETRA refers to the Fair and Equitable Tobacco Reform Act of

67. Slide 67: Balancing Productivity and Disciplined Investment

    Balancing Productivity and Disciplined Investment Manufacturing Headcount ~(7)% 3,000 1,500 Q4 2013 Q1 2015 Note: Headcount includes PMUSA, JMC, and USSTC hourly employees Source: ALCS For Investor Relations Purposes Only

68. Slide 68: Investing For Our Future

    Investing For Our Future  Product development, distribution, and brand-building for innovative tobacco products  Funding regulatory science needed to advance our harm reduction goals We are maximizing our core businesses and growing income, while investing for our future. For Investor Relations Pu

69. Slide 69: Flexible Organizational Structure

    Flexible Organizational Structure Our shared services model allows us flexibility to support our operating companies as they change. For Investor Relations Purposes Only

70. Slide 70: A Compelling Investment

    A Compelling Investment • Provides consistent performance Diverse Business Model through all business environments Strong Balance Sheet • Allow us to continue returning cash to shareholders Focus on Productivity For Investor Relations Purposes Only

71. Slide 71: 2015 Guidance

    2015 Guidance  Altria reaffirms its guidance for 2015 full-year adjusted diluted EPS in the range of $2.75 to $2.80, representing a growth rate of 7% to 9% from an adjusted diluted EPS base of $2.57* in 2014. *For reconciliation of non-GAAP to GAAP measures visit altria.com Source: Altria company r

72. Slide 72: For Investor Relations Purposes Only

    For Investor Relations Purposes Only

73. Slide 73: Altria Group Distribution Company (AGDC)

    Altria Group Distribution Company (AGDC) For Investor Relations Purposes Only

74. Slide 74: AGDC

    AGDC Consumer Sales and Engagement Distribution For Investor Relations Purposes Only

75. Slide 75: Engaging Adult Tobacco Consumers

    Engaging Adult Tobacco Consumers  Managing our database of ~20 million adult tobacco consumers  Using this tool to engage through various channels Source: AGDC For Investor Relations Purposes Only

76. Slide 76: Digital Engagement

    Digital Engagement This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

77. Slide 77: Top-Ranked Websites

    Top-Ranked Websites This space is blank because brand images which appeared in the original presentation have been removed. A third-party review ranked these websites in the top 10 of 100 branded websites. Source: iPerceptions Study For Investor Relations Purposes Only

78. Slide 78: This space is blank because brand images which appeared in the original presentation have

    This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

79. Slide 79: Adult Tobacco Consumer Experiences

    Adult Tobacco Consumer Experiences This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

80. Slide 80: Engaging Adult Tobacco Consumers

    Engaging Adult Tobacco Consumers Interactions (in millions)  Direct mail  E-mail +21%  Programs in adult-only facilities 256  Sweepstakes entries 211  Coupons 2013 2014 Source: AGDC For Investor Relations Purposes Only

81. Slide 81: AGDC's Retail Presence

    AGDC’s Retail Presence This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

82. Slide 82: AGDC's Competitive Advantage

    AGDC’s Competitive Advantage Efficient and Adaptable Model Innovative Tools & Resources Highly Skilled People Effective Trade Alignment For Investor Relations Purposes Only

83. Slide 83: Our Sales and Distribution System

    Our Sales and Distribution System Expanding existing brands Executing price Communicating Promoting and launching and product brand equity responsible new innovative promotions and news retailing products For Investor Relations Purposes Only

84. Slide 84: This space is blank because brand images which appeared in the original presentation have

    This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

85. Slide 85: This space is blank because brand images which appeared in the original presentation have

    This space is blank because brand images which appeared in the original presentation have been removed. Our goal is to gain trade alignment by promoting and demonstrating mutual success. For Investor Relations Purposes Only

86. Slide 86: Efficient Cigarette Distribution Model

    Efficient Cigarette Distribution Model Richmond Manufacturing Center For Investor Relations Purposes Only

87. Slide 87: Efficient Cigarette Distribution Model

    Efficient Cigarette Distribution Model Bonded Warehouse For Investor Relations Purposes Only

88. Slide 88: Efficient Cigarette Distribution Model

    Efficient Cigarette Distribution Model 21 Public Warehouses For Investor Relations Purposes Only

89. Slide 89: Efficient Cigarette Distribution Model

    Efficient Cigarette Distribution Model 600+ Direct Buying Locations For Investor Relations Purposes Only

90. Slide 90: Efficient Cigarette Distribution Model

    Efficient Cigarette Distribution Model Distribution Costs Retail ~3-5% <2% AGDC "Best-in-Class" Typical In 2014, we distributed 125 billion cigarettes at a cost of less than five cents per pack. Note: Distribution costs as of December 31, 2014 (as a % of net revenue, net of FET). Source: Warehouse E

91. Slide 91: Breadth and Scale of Coverage

    Breadth and Scale of Coverage This space is blank because brand images which appeared in the original presentation have been removed. • 240,000 Retail Stores • Call Center provides ongoing • 95% Industry Volume Coverage support for lower-volume stores. Source: AGDC For Investor Relations Purposes On

92. Slide 92: Sharpening Our Shared Services Model

    Sharpening Our Shared Services Model AGDC Organization Size  Expanded Responsibilities  Reduced Costs ~(20)%  Generated Capacity  Expanded Retail Coverage  Improved Processes and Systems 2007 2015 Source: AGDC For Investor Relations Purposes Only

93. Slide 93: Trade Class Tobacco Volume Contribution

    Trade Class Tobacco Volume Contribution 70.5% Balance of Trade Classes = 29.5% C-Stores Tobacco Supermarket Drug Dollar Mass Merch Other Note: Tobacco: Includes Cigarettes, Cigars & Smokeless Only workload for FY 2014 Source: MI Connect STARS week ending 12/28/14 For Investor Relations Purposes Only

94. Slide 94: Convenience Store Overview

    Convenience Store Overview ~150,000 c-stores in the U.S. $700 billion in annual revenues ~160 million consumer transactions per day ~50% of c-store shoppers are in the 21-39 age demographic Source NACS Convenience Trends Jan-Apr 2014, *Nielsen Co. 2012, 2013 NACS CTP (Fuel Included) For Investor Rel

95. Slide 95: Tobacco Impact inside C-Stores

    Tobacco Impact inside C-Stores Other Other Foodservice Snacks and Candy Beer Snacks and Candy Beer 17% Tobacco Packaged Beverages Packaged Beverages 36% Tobacco Foodservice Sales Revenue Gross Profit Dollars Source: NACS Convenience Trends 2014 For Investor Relations Purposes Only

96. Slide 96: Adult Tobacco Consumer Cross-Purchasing

    Adult Tobacco Consumer Cross-Purchasing 48% 30% Average Tobacco Consumer Average Other C-Store Consumer Source: 2014 VideoMining Study; 2014 Retail Experience Survey For Investor Relations Purposes Only

97. Slide 97: Adult Tobacco Consumer Market Basket

    Adult Tobacco Consumer Market Basket ~$25 ~$6 Average Tobacco Consumer Average Other C-Store Consumer Source: 2014 VideoMining Study; 2014 Retail Experience Survey For Investor Relations Purposes Only

98. Slide 98: AGDC Advantages

    AGDC Advantages This space is blank This space is blank because brand images because brand images which appeared in the which appeared in the original presentation original presentation have been removed. have been removed. Leadership Brands Innovative Tools Talented People For Investor Relations Pu

99. Slide 99: PM USA Retail Leaders Program

    PM USA Retail Leaders Program  Offers incentives and promotional resources to help retailers grow their business This space is blank  PM USA achieves acceptance of new offerings and promotions because brand images  PM USA receives best-in class which appeared in the visibility and product placeme

100. Slide 100: This space is blank because brand images which appeared in the original presentation have

     This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

101. Slide 101: Retail Look

     Retail Look This space is blank because brand images which appeared in the original presentation have been removed. Desired retail look in over 90% of PM USA volume For Investor Relations Purposes Only

102. Slide 102: 2015 PM USA Retail Program Options

     2015 PM USA Retail Program Options  Increased funding on Marlboro  Resources to drive volume and improve retailer margins  Integration with retailer loyalty programs  Incentives for supplying scan data For Investor Relations Purposes Only

103. Slide 103: Outstanding Execution Results

     Outstanding Execution Results We consistently achieve 85%+ distribution within two weeks. Note: Includes distribution as % of targeted stores Source: MIConnect STARS Data Week Ending 12/27/14 For Investor Relations Purposes Only

104. Slide 104: Flexible Merchandising Solutions

     Flexible Merchandising Solutions This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

105. Slide 105: MarkTen Curb-to-Counter Visibility

     MarkTen Curb-to-Counter Visibility This space is blank because brand images  130,000+ stores which appeared in the  85% of stores achieving original presentation visibility targets have been removed. Source: AGDC For Investor Relations Purposes Only

106. Slide 106: Actionable Insights

     Actionable Insights Source: AGDC For Investor Relations Purposes Only

107. Slide 107: Market Analytics

     Market Analytics Sample Data Our sales team helps retailers capitalize on insights. Source: AGDC For Investor Relations Purposes Only

108. Slide 108: Reviewing Category

     Reviewing Category Sample Data % Volume Change Current vs. Previous 13 weeks 4.9% 4.3% 4.6% 3.5% 3.2% 3.1% Industry PM USA Marlboro Store Market Source: AGDC For Investor Relations Purposes Only

109. Slide 109: Marlboro Volume Composition

     Marlboro Volume Composition Sample Data Avg. CPW Avg. CPW % Vol. vs. 4wm Current 13 wks Previous 13 wks Marlboro Menthol 29.8 29.7 5.2% Marlboro Gold 22.9 22.7 -3.4% Marlboro Special Blend 12.8 12.7 4.1% Marlboro Regulars 11.0 11.2 4.7% Marlboro Balance 11.8 11.9 5.3% Total Marlboro 88.3 88.2 3.1% S

110. Slide 110: Identifying Solutions

     Identifying Solutions Price Availability Visibility For Investor Relations Purposes Only

111. Slide 111: Our People

     Our People For Investor Relations Purposes Only

112. Slide 112: University Recruiting Program

     University Recruiting Program  17 focus schools  Immersive internship  On-campus engagement Note: Third-party trademarks are the property of their respective owners and are included for informational purposes only. For Investor Relations Purposes Only

113. Slide 113: Sales Recruiting Success

     Sales Recruiting Success  100+ interns annually  85% acceptance of full-time offers in 2014  Often results in leaders who rise rapidly at AGDC Source: ALCS For Investor Relations Purposes Only

114. Slide 114: Sales Recruiting Success

     Sales Recruiting Success  100+ interns annually  85% acceptance of full-time offers in 2014  Often results in leaders who rise rapidly at AGDC Source: ALCS For Investor Relations Purposes Only

115. Slide 115: AGDC Leadership Team

     AGDC Leadership Team For Investor Relations Purposes Only

116. Slide 116: Trade Engagement

     Trade Engagement Executive Summit Retail Council For Investor Relations Purposes Only

117. Slide 117: Measuring Success: Customer Feedback

     Measuring Success: Customer Feedback “… is better than other CPG reps” 100% 88% 69% 44% 0% AGDC Competitor A Competitor B Source: 2014 ALCS MICR Trade and Shopper Insights For Investor Relations Purposes Only

118. Slide 118: AGDC's Competitive Advantage

     AGDC’s Competitive Advantage Efficient and Adaptable Model Innovative Tools & Resources Highly Skilled People Effective Trade Alignment For Investor Relations Purposes Only

119. Slide 119: For Investor Relations Purposes Only

     For Investor Relations Purposes Only

120. Slide 120: For Investor Relations Purposes Only

     For Investor Relations Purposes Only

121. Slide 121: This space is blank because brand images which appeared in the original presentation have

     This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

122. Slide 122: Agenda

     Agenda  Update on smokeless and cigars performance  Evolution of e-vapor portfolio  Progress and results on Marlboro For Investor Relations Purposes Only

123. Slide 123: Pre-Acquisition Share Performance

     Pre-Acquisition Share Performance Copenhagen & Skoal Combined This space is blank 70% 68% 64% 60% because brand images 56% 53% 50% 47% which appeared in the original presentation have been removed. '01 '02 '03 '04 '05 '06 '07 '08 Source: USSTC RAD/SVT ending December 2008 For Investor Relations Purp

124. Slide 124: 2009 Copenhagen Position

     2009 Copenhagen Position This space is blank 22.6% because brand images which appeared in the original presentation have been removed. 2009 Source: IRI InfoScan For Investor Relations Purposes Only

125. Slide 125: This space is blank because brand images which appeared in the original presentation have

     This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

126. Slide 126: Copenhagen Retail Share Performance

     Copenhagen Retail Share Performance +8.1pp 30.7% 22.6% 2009 2014 Source: IRI InfoScan For Investor Relations Purposes Only

127. Slide 127: Copenhagen Share Growth

     Copenhagen Share Growth Among Dippers 21-29 ~+10pp 30 0 2009 2014 Source: IRI InfoScan For Investor Relations Purposes Only

128. Slide 128: This space is blank because brand images which appeared in the original presentation have

     This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

129. Slide 129: Skoal Retail Share Performance

     Skoal Retail Share Performance Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 This space is blank because brand images (0.5) (0.5) which appeared in the (0.8) original presentation (1.1) have been removed. (1.4) Source: IRI InfoScan For Investor Relations Purposes Only

130. Slide 130: Smokeless Products Strategy

     Smokeless Products Strategy For Investor Relations Purposes Only

131. Slide 131: Smokeless Products Adjusted Volume Growth

     Smokeless Products Adjusted Volume Growth Cans in Millions ~5% CAGR 900 0 2009 2014 Note: Volume adjusted for trade inventory changes, calendar differences and product discontinuation. Source: IRI InfoScan, ALCS Estimate For Investor Relations Purposes Only

132. Slide 132: Copenhagen and Skoal Retail Share Growth

     Copenhagen and Skoal Retail Share Growth +3.8pp 51.0% 47.2% 2009 2014 Source: IRI InfoScan For Investor Relations Purposes Only

133. Slide 133: Smokeless Adjusted OCI Growth

     Smokeless Adjusted OCI* Growth $ in Millions +10.9% +5.0% CAGR $1,060 $632 $239 $251 2009 2014 Q1 2014 Q1 2015 *For reconciliation of non-GAAP to GAAP measures visit altria.com Source: Altria company reports For Investor Relations Purposes Only

134. Slide 134: Smokeless Adjusted OCI Margins

     Smokeless Adjusted OCI* Margins +13.9pp 63.4% This space is blank 49.5% because brand images which appeared in the original presentation have been removed. 2009 2014 *For reconciliation of non-GAAP to GAAP measures visit altria.com Source: Altria company reports For Investor Relations Purposes Only

135. Slide 135: This space is blank because brand images which appeared in the original presentation have

     This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

136. Slide 136: Profitable Growth for Black & Mild

     Profitable Growth for Black & Mild  Category growth dominated by low-priced untipped cigarillos This space is blank  Middleton has grown Black & Mild’s because brand images share of high-margin tipped cigarillos which appeared in the original presentation have been removed. For Investor Relations

137. Slide 137: Delivering Black & Mild Variety

     Delivering Black & Mild Variety This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

138. Slide 138: Cigars Reported Shipment Volume Growth

     Cigars Reported Shipment Volume Growth Sticks in Millions +6.1% +10.2% 1,271 1,198 274 302 2013 2014 Q1 2014 Q1 2015 Source: Altria company reports For Investor Relations Purposes Only

139. Slide 139: Black & Mild Retail Share of Tipped Segment

     Black & Mild Retail Share of Tipped Segment ~+2pp 89% 91% 2013 2014 Source: IRI InfoScan For Investor Relations Purposes Only

140. Slide 140: Our Aspiration and Approach in E-Vapor

     Our Aspiration and Approach in E-Vapor  Long-term success  Financial discipline  Adult tobacco consumer focused For Investor Relations Purposes Only

141. Slide 141: E-Vapor Desired Attributes

     E-Vapor Desired Attributes  Fullness of vapor  Familiar taste and form  Flavor variety  Dependable quality  Good battery life  Long-lasting cartridge  Reasonable value For Investor Relations Purposes Only

142. Slide 142: MarkTen XL Features

     MarkTen XL Features  Longer-lasting cartridge and battery  Familiar taste and form  More flavor variety For Investor Relations Purposes Only

143. Slide 143: This space is blank because brand images which appeared in the original presentation have

     This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

144. Slide 144: Green Smoke Product Features

     Green Smoke Product Features Optimized Flavor Delivery Sealed for Fresh Flavor FlavorMax™ is a suite of technologies which creates consistently fresh, full-bodied flavors and a rich vapor. For Investor Relations Purposes Only

145. Slide 145: Expanding Green Smoke Retail Presence

     Expanding Green Smoke Retail Presence This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

146. Slide 146: Partnering with PMI

     Partnering with PMI  Began providing e-vapor products to PMI for international markets in Q1 2015 Note: Third-party trademarks are the property of their respective owners and are included for informational purposes only. For Investor Relations Purposes Only

147. Slide 147: A Developing e-Vapor Category

     A Developing e-Vapor Category  Current products have performance gaps  Category growth has slowed  Manufacturers awaiting regulatory guidance Note: Third-party trademarks are the property of their respective owners and are included for informational purposes only. For Investor Relations Purposes

148. Slide 148: Portfolio Approach

     Portfolio Approach This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

149. Slide 149: This space is blank because brand images which appeared in the original presentation have

     This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

150. Slide 150: Marlboro Repositioning

     Marlboro Repositioning This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

151. Slide 151: This space is blank because brand images which appeared in the original presentation have

     This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

152. Slide 152: Marlboro Long-Term Retail Share Growth

     Marlboro Long-Term Retail Share Growth 44.0 1954 1964 1974 1984 1994 2004 Q1 ‘15 Source: Maxwell; MSAi Shipments; IRI/Capstone – Total Retail Panel; IRP IRI Group/Capstone Projected Retail Panel; IRI/MSAi For Investor Relations Purposes Only

153. Slide 153: This space is blank because brand images which appeared in the original presentation have

     This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

154. Slide 154: Active Digital Engagement

     Active Digital Engagement This space is blank because brand images 20+ Million Uploads which appeared in the original presentation Comments have been removed. Likes Dec 2012-Present Source: PM USA For Investor Relations Purposes Only

155. Slide 155: This space is blank because brand images which appeared in the original presentation have

     This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

156. Slide 156: Expanded Product Lineup

     Expanded Product Lineup This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

157. Slide 157: This space is blank because brand images which appeared in the original presentation have

     This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

158. Slide 158: Reinforcing Marlboro's Premium Position

     Reinforcing Marlboro’s Premium Position This space is blank because brand images which appeared in the original presentation have been removed. Marlboro has enhanced packaging on more than half of its volume since 2011. For Investor Relations Purposes Only

159. Slide 159: PM USA Direct Marketing Approach

     PM USA Direct Marketing Approach  Focuses on smokers age-verified as 21 and older  Taking steps to limit reach among unintended audiences  Primarily direct mail, e-mail and Marlboro.com  Smokers 21 and older must confirm they want to receive communications For Investor Relations Purposes Only

160. Slide 160: Marlboro.com Digital Engagement

     Marlboro.com Digital Engagement This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

161. Slide 161: Marlboro's Mobile Presence

     Marlboro’s Mobile Presence This space is blank because brand images Marlboro.com is among the leading which appeared in the CPG mobile websites. original presentation have been removed. Source: comScore, Q1 2015 For Investor Relations Purposes Only

162. Slide 162: This space is blank because brand images which appeared in the original presentation have

     This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

163. Slide 163: Marlboro App: Convenient Interaction

     Marlboro App: Convenient Interaction This space is blank because brand images which appeared in the original presentation have been removed.

164. Slide 164: Increased Mobile Engagement

     Increased Mobile Engagement Mobile Logins - in Millions ~+1,000% 10 0 2011 2014 Note: Total mobile interactions (Adult Smokers 21+) Source: PM USA

165. Slide 165: Increased Adult Smoker Engagement

     Increased Adult Smoker Engagement Total Touchpoints - in Billions +20% 1.4 1.1 2012 2014 Note: Touch points interactions include On-pack coupons, Mobile and Direct Mail. Source: GMR and Arc

166. Slide 166: Smokeable Products Companies' Strategy

     Smokeable Products Companies’ Strategy For Investor Relations Purposes Only

167. Slide 167: Marlboro Pricing

     Marlboro Pricing  Increased list price in May by $0.07 This space is blank  Net pack price of $6.06 through May 31 because brand images which appeared in the original presentation have been removed. We continue to believe Marlboro has long-term pricing flexibility. Source: ALCS MICR For Investor R

168. Slide 168: PM USA Pricing Approach and Tools

     PM USA Pricing Approach and Tools  Maintain competitive pricing This space is blank  Monitor Marlboro’s price gap at national and state levels because brand images  Manage the mix of full-priced and which appeared in the promotional product in the marketplace original presentation have been remov

169. Slide 169: Price Promotions

     Price Promotions Marlboro Special Blend Net Price This space is blank +$0.20 $5.50 because brand images which appeared in the original presentation have been removed. $4.50 2013 2014 Source: ALCS MICR For Investor Relations Purposes Only

170. Slide 170: Bonus Product Rates

     Bonus Product Rates as a % of Volume 25% FY 2014 Q1 2015 0% PM USA RJRT Lorillard Note: Bonus rate calculated as percentage of shipment volume. Source: ALCS MICR For Investor Relations Purposes Only

171. Slide 171: Smokeable Products Segment Price Realization

     Smokeable Products Segment Price Realization Net Revenues Net of Excise Taxes /1000 Units* +3.9% +5.2% CAGR $122.56 $120.04 $126.31 $109.38 2011 2014 Q1 2014 Q1 2015 Marlboro grew retail share ~1pp from 2011-2014. *For reconciliation of non-GAAP to GAAP measures visit altria.com Source: Altria compa

172. Slide 172: Strong Marlboro Brand Equity

     Strong Marlboro Brand Equity Overall Brand Equity Brand Status Brand Momentum +3pp +3pp +3pp 80 80 80 0 0 0 2010 2014 2010 2014 2010 2014 Source: 2014 TNS Brand Equity Study (Age Group: 21 – 54), February 2015 For Investor Relations Purposes Only

173. Slide 173: Marlboro Adult Smoker Opinions

     Marlboro Adult Smoker Opinions Taste Quality +6pp +6pp 70 70 0 0 2010 2014 2010 2014 Source: 2014 TNS Brand Equity Study (Age Group: 21 – 54), February 2015 For Investor Relations Purposes Only

174. Slide 174: Unmatched Brand Equity

     Unmatched Brand Equity Overall Equity Overall Opinion 70 70 0 0 Marlboro Camel Newport Marlboro Camel Newport Source: 2014 TNS Brand Equity Study (Age Group: 21 – 54), February 2015 For Investor Relations Purposes Only

175. Slide 175: This space is blank because brand images which appeared in the

     This space is blank because brand images Marlboro adult smokers are the most which appeared in the brand loyal among key original presentation competitive brands. have been removed. Source: ALCS CATTS – 3mm ending March 2015 For Investor Relations Purposes Only

176. Slide 176: Marlboro Strong Demographics

     Marlboro Strong Demographics Share Among Adult Smokers 50 25 Total Marlboro AS 21-29 Source: ALCS CATTS – 3mm ending March 2015 For Investor Relations Purposes Only

177. Slide 177: Share Trends Among Smokers 21-29

     Share Trends Among Smokers 21-29 Q1 2015 Q1 2015 50 50 Marlboro 30 0 Q2 2013 Q1 2015 Marlboro Camel Newport Source: ALCS CATTS Adult smoker database ending March 31, 2015 For Investor Relations Purposes Only

178. Slide 178: Marlboro Green and Black Families Performance

     Marlboro Green and Black Families Performance Marlboro has grown its share Marlboro Black has grown of menthol category over the retail share in each of the past past two years. 17 consecutive quarters. Source: IRI/MSAi InfoScan For Investor Relations Purposes Only

179. Slide 179: This space is blank because brand images which appeared in the original presentation have

     This space is blank because brand images which appeared in the original presentation have been removed. For Investor Relations Purposes Only

180. Slide 180: For Investor Relations Purposes Only

     For Investor Relations Purposes Only

181. Slide 181: Regulation G Disclosure

     Regulation G Disclosure  For reconciliations and further explanations of non-GAAP financial measures, visit: altria.com For Investor Relations Purposes Only

Altria Group — Investor Day (June 2015) on 6ix