10-QPeriod: Q1 FY2023

ALTRIA GROUP, INC. Quarterly Report for Q1 Ended Mar 31, 2023

Filed April 27, 2023For Securities:MO

Summary

Altria Group, Inc. (MO) reported a decrease in net revenue to $5.72 billion for the first quarter of 2023, down from $5.89 billion in the prior year period, primarily due to lower sales in the smokeable products segment. Net earnings also declined to $1.79 billion, or $1.00 per diluted share, compared to $1.96 billion, or $1.08 per diluted share, in the first quarter of 2022. The company divested its JUUL equity securities in March 2023, resulting in a pre-tax loss of $250 million. Despite these declines, Altria continues to make progress on its "Moving Beyond Smoking" vision, notably through the definitive agreement to acquire NJOY Holdings, Inc., a U.S.-based e-vapor company, for approximately $2.75 billion. The company's balance sheet remains robust, with total assets of $36.83 billion as of March 31, 2023. Debt levels have decreased year-over-year, with total liabilities at $40.65 billion. Altria also announced a new progressive dividend goal targeting mid-single-digit annual growth. The company reaffirmed its full-year adjusted diluted EPS guidance of $4.98 to $5.13.

Financial Highlights

49 data points
Beta

Revenue

$5.72B

58.2% Gross Margin

Net Income

$1.79B

31.2% Net Margin

EPS (Diluted)

$1.00

Total Assets

$36.83B

Cash & Equivalents

$3.97B

Free Cash Flow

$2.93B

Financial Statements
Beta
Revenue$5.72B
Cost of Revenue$1.43B
Gross Profit$3.33B
Operating Income$2.76B
Net Income$1.79B
EPS (Basic)$1.00
EPS (Diluted)$1.00
Shares Outstanding (Basic)1.79B
Shares Outstanding (Diluted)1.79B

Key Highlights

  • 1Net revenues decreased by 2.9% to $5.72 billion in Q1 2023 compared to Q1 2022.
  • 2Net earnings decreased by 8.8% to $1.79 billion in Q1 2023, resulting in diluted EPS of $1.00, down from $1.08 in Q1 2022.
  • 3Altria divested its JUUL equity securities in March 2023, incurring a pre-tax loss of $250 million.
  • 4The company entered into a definitive agreement to acquire NJOY Holdings, Inc. for approximately $2.75 billion, subject to regulatory approval.
  • 5Total debt decreased to $25.4 billion at March 31, 2023, from $26.7 billion at December 31, 2022.
  • 6Altria announced a new progressive dividend goal targeting mid-single-digit annual growth.
  • 7Full-year 2023 adjusted diluted EPS guidance remains in the range of $4.98 to $5.13.

Frequently Asked Questions

For the first quarter of 2023, Altria reported net revenues of $5.72 billion, a decrease of 2.9% compared to the prior year period. Net earnings were $1.79 billion, or $1.00 per diluted share, down from $1.96 billion, or $1.08 per diluted share, in the first quarter of 2022. The company also incurred a $250 million pre-tax loss related to the divestiture of its JUUL equity securities.

Altria entered into a definitive agreement to acquire NJOY Holdings, Inc., a U.S.-based e-vapor company, for approximately $2.75 billion in cash, plus up to an additional $500 million in contingent cash payments. The transaction is subject to customary closing conditions, including clearance from the U.S. Federal Trade Commission (FTC), with the current waiting period set to expire in May 2023.

Altria's total debt decreased to $25.4 billion at March 31, 2023, from $26.7 billion at the end of 2022, following the repayment of $1.3 billion in Euro notes. The company also announced a new progressive dividend goal targeting mid-single-digit annual growth and continues to execute on its share repurchase programs.

Altria maintained its full-year 2023 adjusted diluted EPS guidance in the range of $4.98 to $5.13, representing a projected growth rate of 3% to 6% over 2022. This guidance accounts for various economic and consumer dynamics, as well as planned investments in its smoke-free future vision, but does not include the potential financial impacts of the NJOY acquisition.