DOCSLIB.ORG

Complaint Counsel's Pre-Trial Brief

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Complaint Counsel's Pre-Trial Brief FEDERAL TRADE COMMISSION | OFFICE OF THE SECRETARY | FILED 5/19/2021 | OSCAR NO. 601467 | Page 1 of 89 | PUBLIC PUBLIC UNITED STATES OF AMERICA FEDERAL TRADE COMMISSION OFFICE OF ADMINSTRATIVE LAW JUDGES In the Matter of Altria Group, Inc. DOCKET NO. 9393 a corporation; and JUUL Labs, Inc. a corporation. COMPLAINT COUNSEL’S PRE-TRIAL BRIEF Maribeth Petrizzi Stephen Rodger Acting Director James Abell Jeanine Balbach Jennifer Milici Michael Blevins Acting Deputy Director Erik Herron Frances Anne Johnson Dominic E. Vote Joonsuk Lee Assistant Director Meredith Levert Nicole Lindquist Peggy Bayer Femenella Michael Lovinger Deputy Assistant Director David Morris Kristian Rogers Federal Trade Commission Steven Wilensky Bureau of Competition Attorneys 600 Pennsylvania Ave., N.W. Washington, DC 20580 Telephone: (202) 326-2470 Facsimile: (202) 326-3496 Email: [email protected] Dated: May 19, 2021 FEDERAL TRADE COMMISSION | OFFICE OF THE SECRETARY | FILED 5/19/2021 | OSCAR NO. 601467 | Page 2 of 89 | PUBLIC PUBLIC TABLE OF CONTENTS TABLE OF AUTHORITIES ......................................................................................................... iv INTRODUCTION...................................................................................................................... 1 I. BACKGROUND .................................................................................................................... 4 1. The Rise of Electronic Cigarettes ...................................................................................... 4 a. E-Cigarettes Are Critically Important to the Tobacco Companies ................................. 4 b. Closed-System E-Cigarettes Differ from Open-Tank E-Cigarettes ................................ 5 c. Closed-System E-Cigarettes Include Cigalikes and Pod-Based Products ...................... 5 d. FDA Regulation and Other Barriers Limit Market Participation ................................... 6 2. The Market for Closed-System E-Cigarettes in the United States Is Dominated by a Very Small Group of Competitors .................................................................................... 7 a. Altria ............................................................................................................................... 7 b. JLI ................................................................................................................................... 8 c. Reynolds ......................................................................................................................... 9 d. ITG .................................................................................................................................. 9 e. JTI ................................................................................................................................. 10 f. NJOY ............................................................................................................................ 10 3. The Transaction Includes a Non-Compete Prohibiting Altria from Competing in E- Cigarettes......................................................................................................................... 10 4. Altria Was a Meaningful and Well-Positioned Competitor Who Was Committed to the E-Cigarette Category over the Long-Term................................................................ 12 a. Altria was a Major Competitor in Closed-System E-Cigarettes ................................... 12 b. Altria was Committed to Competing in E-Cigarettes Long-Term, and was Well- Positioned to Do So...................................................................................................... 14 5. JLI’s Growth Threatened Altria ...................................................................................... 18 6. As Part of Its Agreement to Acquire an Interest in JLI, Altria Agreed to— and Did—Exit the E-Cigarette Business ......................................................................... 18 7. The Non-Compete Foreclosed Other Avenues for Altria to Compete in the Closed- System E-Cigarette Market ............................................................................................. 27 II. ARGUMENT ....................................................................................................................... 30 1. The Relevant Market Is Sales of Closed-System E-Cigarettes in the United States ....... 30 a. The Relevant Product Market Is Closed-System E-Cigarettes ..................................... 30 i. Closed-System E-Cigarettes Are a Relevant Product Market Based on the Brown Shoe Factors .............................................................................................. 32 ii. The Closed-System E-Cigarette Market Excludes Open-Tank E-Cigarettes Because They Are Not Close Substitutes ............................................................. 35 i FEDERAL TRADE COMMISSION | OFFICE OF THE SECRETARY | FILED 5/19/2021 | OSCAR NO. 601467 | Page 3 of 89 | PUBLIC PUBLIC iii. The Hypothetical Monopolist Test Confirms Closed-System E-Cigarettes Are a Relevant Product Market............................................................................. 37 b. The Relevant Geographic Market Is the United States ................................................. 38 2. Respondents’ Agreement Violates Section 1 of the Sherman Act .................................. 38 a. Altria and JLI agreed that Altria would exit the U.S. e-cigarette market in exchange for its stake in JLI......................................................................................................... 39 i. Respondents’ communications establish that both firms understood that Altria could not continue to compete in the e-cigarette market ...................................... 40 ii. Altria’s outside agreement with PMI presented obstacles to Altria divesting or contributing its e-vapor assets............................................................................... 41 iii. In the absence of the transaction, the discontinuation of Nu Mark was against Altria’s economic self-interest .............................................................................. 42 iv. The Timeline of Altria’s Actions is Highly Suspect ............................................. 44 v. Respondents’ words and actions further support finding an anticompetitive agreement .............................................................................................................. 45 vi. Altria’s proffered explanations for its decision to exit the e-cigarette market are pretextual and inconsistent .............................................................................. 46 b. Respondents’ Agreement is Unlawful Under the Rule of Reason ................................ 51 i. The agreement has harmed and will continue to harm consumers ....................... 52 ii. Respondents cannot show procompetitive justifications for their Agreement ..... 55 iii. Even if the Respondents could show procompetitive justifications, the Agreement was not necessary to achieve them ..................................................... 56 iv. The competitive harm outweighs any benefits ..................................................... 57 c. Standing alone, the written Non-Compete also violates Section 1 of the Sherman Act ................................................................................................................. 57 i. Respondents cannot show the Non-Compete agreement is ancillary to an otherwise lawful transaction ................................................................................. 58 ii. Even if the Non-Compete was ancillary to an otherwise lawful transaction, it fails under the rule of reason ............................................................................. 60 3. The Transaction Violates Section 7 of the Clayton Act .................................................. 60 a. Applicable Legal Standard Under Section 7 ................................................................. 60 b. The Transaction Is Presumptively Unlawful in the Market for Sales of Closed-System E-Cigarettes in the United States ........................................................ 62 c. Evidence of Competitive Harm Bolsters the Presumption ........................................... 64 d. Respondents Cannot Rebut the Strong Presumption of Illegality ................................ 66 i. Entry or expansion will not be timely, likely, or sufficient to counteract the anticompetitive effects of the Transaction ............................................................ 67 ii. The claimed efficiencies are insufficient to rebut the presumption of harm ........ 69 ii FEDERAL TRADE COMMISSION | OFFICE OF THE SECRETARY | FILED 5/19/2021 | OSCAR NO. 601467 | Page 4 of 89 | PUBLIC PUBLIC a. Respondents’ Claimed Efficiencies Cannot be Verified ..................................... 70 b. Respondents’ Claimed Efficiencies Are Not Merger-Specific ........................... 71 e. The Transaction Also Eliminated Altria as a Potential Competitor to JLI ................... 72 4. The Appropriate Remedies are the Complete Divestiture of Altria’s Equity Stake and the Immediate Termination of the Non-Compete Agreement .................................. 74 CONCLUSION ........................................................................................................................ 76 iii FEDERAL TRADE COMMISSION | OFFICE OF THE SECRETARY | FILED 5/19/2021 | OSCAR NO. 601467 | Page 5 of 89 | PUBLIC PUBLIC
Load more

Recommended publications
  • Altria.Com/Proxy
    6601 West Broad Street Richmond, Virginia 23230 Dear Fellow Shareholder: It is my pleasure to invite you to join us at the 2016 Annual Meeting of Shareholders of Altria Group, Inc. to be held on Thursday, May 19, 2016 at 9:00 a.m., Eastern Time, at the Greater Richmond Convention Center, 403 North 3rd Street, Richmond, Virginia 23219. At this year’s meeting, we will vote on the election of 11 directors, the ratification of the selection of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm and, if properly presented, two shareholder proposals. We will also conduct a non-binding advisory vote to approve the compensation of the Company’s named executive officers. There also will be a report on the Company’s business, and shareholders will have an opportunity to ask questions. To attend the meeting, an admission ticket and government-issued photo identification are required. To request an admission ticket, please follow the instructions on page 9 in response to Question 16. One immediate family member who is 21 years of age or older may accompany a shareholder as a guest. We use the U.S. Securities and Exchange Commission rule that allows companies to furnish proxy materials to their shareholders over the Internet. We believe this expedites shareholders receiving proxy materials, lowers costs and conserves natural resources. We thus are mailing to many shareholders a Notice of Internet Availability of Proxy Materials, rather than a paper copy of the Proxy Statement and our Annual Report on Form 10-K for the fiscal year ended December 31, 2015.
    [Show full text]
  • Altria Group, Inc. Annual Report
    Altria Group, Inc. 2019 Annual Report an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company an Altria Company Howard A. Willard III Dear Fellow Shareholders Chairman of the Board and CEO Altria delivered solid performance in a dynamic year for the tobacco industry. Our core tobacco businesses delivered outstanding financial performance, and we made significant progress advancing our non-combustible product platform. We believe Altria’s enhanced business platform positions us well for future success. 2019 Highlights n Grew adjusted diluted earnings per share (EPS) by 5.8%, primarily driven by our core tobacco businesses; and types of legal cases pending against it, especially during the fourth n Achieved $600 million in annualized cost savings, exceeding our $575 quarter of the year. Altria recorded two impairment charges of our JUUL million target announced in December 2018; asset in 2019, reducing our investment to $4.2 billion at year-end, down from n Increased our regular quarterly dividend for the 54th time in 50 years $12.8 billion, our 2019 initial investment. JUUL remains the U.S. leader in the and paid shareholders approximately $6.1 billion in dividends; and e-vapor category, and in January 2020 we revised certain terms governing n Repurchased 16.5 million Altria shares for a total cost of $845 million.
    [Show full text]
  • Altria Group, Inc. Annual Report
    ananan Altria Altria Altria Company Company Company an Altria Company ananan Altria Altria Altria Company Company Company | Inc. Altria Group, Report 2020 Annual an Altria Company From tobacco company To tobacco harm reduction company ananan Altria Altria Altria Company Company Company an Altria Company ananan Altria Altria Altria Company Company Company an Altria Company Altria Group, Inc. Altria Group, Inc. | 6601 W. Broad Street | Richmond, VA 23230-1723 | altria.com 2020 Annual Report Altria 2020 Annual Report | Andra Design Studio | Tuesday, February 2, 2021 9:00am Altria 2020 Annual Report | Andra Design Studio | Tuesday, February 2, 2021 9:00am Dear Fellow Shareholders March 11, 2021 Altria delivered outstanding results in 2020 and made steady progress toward our 10-Year Vision (Vision) despite the many challenges we faced. Our tobacco businesses were resilient and our employees rose to the challenge together to navigate the COVID-19 pandemic, political and social unrest, and an uncertain economic outlook. Altria’s full-year adjusted diluted earnings per share (EPS) grew 3.6% driven primarily by strong performance of our tobacco businesses, and we increased our dividend for the 55th time in 51 years. Moving Beyond Smoking: Progress Toward Our 10-Year Vision Building on our long history of industry leadership, our Vision is to responsibly lead the transition of adult smokers to a non-combustible future. Altria is Moving Beyond Smoking and leading the way by taking actions to transition millions to potentially less harmful choices — a substantial opportunity for adult tobacco consumers 21+, Altria’s businesses, and society. To achieve our Vision, we are building a deep understanding of evolving adult tobacco consumer preferences, expanding awareness and availability of our non-combustible portfolio, and, when authorized by FDA, educating adult smokers about the benefits of switching to alternative products.
    [Show full text]
  • Countervailing Effects of a Potential Ban on Menthol Cigarettes
    Countervailing Effects of a Potential Ban on Menthol Cigarettes Joe Murillo – Vice President and Associate General Counsel Altria Client Services on behalf of PM USA February 10, 2011 Altria Client Services on behalf of PM USA | 2.10.2011 | 1 Brand Integrity’s Role & Strategies Role: To protect the integrity of Altria’s tobacco operating companies’ brands and the legitimate trade channels through which they are distributed and sold. Strategies: . Market Monitoring . Investigative Intelligence . Law Enforcement Engagement & Support . Litigation . Trade Compliance . Product Intelligence & Security . Legislation Altria Client Services on behalf of PM USA | 2.10.2011 | 2 Key Points of Dec. 30, 2010 Submission to FDA PM USA believes that banning menthol cigarettes could trigger a series of unintended consequences that would be detrimental to FDA’s public health objectives and to society more generally. These unintended consequences would likely include: . Significant expansion of the unregulated, illicit cigarette market . Increased organized crime . Increased burdens for law enforcement . An erosion in underage access prevention . Declining tax revenues and tobacco settlement payments to the states . Significant job losses within the legitimate distribution chain – from farmers to retail clerks; and . Self-mentholation of cigarettes Altria Client Services on behalf of PM USA | 2.10.2011 | 3 Unlicensed Manufacturing (Loosies) ATF New York - United States CBSA - Canada Source: Images provided to ALCS upon request by ATF & CBSA January 2011
    [Show full text]
  • Altria Group, Inc. 2007 Annual Report on March 28, 2008, Altria Group, Inc
    We have not included any tobacco brand advertising in this online version of the 2007 Annual Report. We do not intend to market, advertise or promote the brands of Altria Group’s tobacco subsidiaries on this Web site. Altria Group, Inc. 2007 Annual Report On March 28, 2008, Altria Group, Inc. (Altria) completed the spin-off of 100% of the shares of Philip Morris International Inc. (PMI) to Altria’s shareholders. The PMI spin-off and related actions position Altria and PMI for future success as stand-alone companies with unique and formidable strengths, including leading brands, strong cash flows, experienced leadership and solid growth prospects. Business Purpose Share Distribution Shareholder Value Additional Information PMI’s separation from Altria is n The distribution was made on n Altria is expected to pay a divi- n Registered shareholders expected to enhance growth and March 28, 2008, to Altria share- dend at the initial rate of $0.29 in the U.S. and Canada who shareholder value by providing: holders of record as of 5:00 p.m. per share per quarter, or $1.16 would like more information n An improved focus on the New York City Time on March 19, per common share on an annual- should contact Computershare different market dynamics, com- 2008 (the record date). ized basis. Altria has established Trust Company by e-mail at petitive frameworks, challenges n Altria distributed one share of a dividend policy that anticipates [email protected] or and opportunities faced by Altria PMI for every share of Altria com- a payout ratio of approximately by phone at 1-866-538-5172.
    [Show full text]
  • Altria Corp (NYSE: MO)
    January 4, 2019 Altria Corp (NYSE: MO) CURRENT PRICE : $50.30 Acquisitions & Added Debt RATING : HOLD Highlights PRICE TARGET : N/A • 3Q18 earnings of $1.03/share vs. $0.97/share during 3Q17 CURRENT YIELD : 6.4% • Acquiring equity stakes in JUUL & CRONOS • Debt level increases due to acquisitions • Confluence of items hits stock price EPS Estimates - Non-GAAP • Maintain HOLD rating DEC 17A DEC 18E Investment Thesis 1Q $0.72 A $1.00A Altria Corp (MO-$50.30), formerly known as Philip Morris, is the largest US 2Q $1.03 A $0.99A tobacco company. MO is focused on the US domestic tobacco business and has seen year-over-year revenue growth, on a pro-forma basis. Going forward 3Q $0.97 A $1.03A management intends to grow earnings through revenue/cash flow growth, share 4Q $2.60 A $0.92 repurchases, and cost reductions. Earnings growth may generate dividend increases in the future. MO’s stock pays a current dividend yield of 6.4%. $5.31 $3.94 Company Summary Trading Data Altria Group, headquartered in Richmond VA, is the parent company of Philip 52-WEEK PRICE RANGE : $71.86 - $46.49 Morris USA, US Smokeless Tobacco, John Middleton, Ste. Michelle Estate SHARES OUTSTANDING : 1,883(M) Wineries, and Philip Morris Capital Corp (PMCC). The company operates five segments: domestic cigarettes, smokeless tobacco products, machine made cigars, MARKET CAP : $94.8(B) wineries, and financial services/real estate. The company has 9,900 employees AVG . DAILY TRADING 10.3(M) located throughout the US. Philip Morris USA manufactures and sells cigarettes, VOLUME : and other tobacco products, in the US.
    [Show full text]
  • Altria Announces Expiration of Cash Tender Offer; Reaffirms 2016 Full-Year Earnings Guidance
    ALTRIA ANNOUNCES EXPIRATION OF CASH TENDER OFFER; REAFFIRMS 2016 FULL-YEAR EARNINGS GUIDANCE RICHMOND, Va. – September 20, 2016 – Altria Group, Inc. (Altria) (NYSE: MO) announces the expiration of its previously announced cash tender offer for any and all of its senior unsecured 9.95% Notes due 2038 (the “2038 Notes”) and any and all of its senior unsecured 10.20% Notes due 2039 (the “2039 Notes” and, together with the 2038 Notes, the “Notes”). The terms and conditions of the tender offer are described in the Offer to Purchase, dated September 13, 2016 and the related Letter of Transmittal and Notice of Guaranteed Delivery. The tender offer for the Notes expired at 5:00 p.m., New York City time, on Monday, September 19, 2016 (the “Expiration Time”). According to information provided by Global Bondholder Services Corporation, the Depositary and Information Agent for the tender offer, $441,081,000 aggregate principal amount of the 2038 Notes and $492,961,000 aggregate principal amount of the 2039 Notes were validly tendered at or prior to the Expiration Time and not validly withdrawn, which amounts include $1,187,000 aggregate principal amount of the outstanding 2038 Notes that remain subject to guaranteed delivery procedures and $1,165,000 aggregate principal amount of the outstanding 2039 Notes that remain subject to guaranteed delivery procedures. Title of CUSIP Outstanding Principal U.S. Treasury U.S. Treasury Fixed Total Securities Number Principal Amount Reference Reference Spread Consideration** Amount Tendered* Security Yield (bps) 9.95% 2.500% due Notes 02209SAE3 $682,321,000 $441,081,000 5/15/2046 2.443% 167 $1,842.71 due 2038 10.20% Notes 02209SAH6 $717,708,000 $492,961,000 2.500% due 2.443% 167 $1,884.63 due 2039 5/15/2046 * Includes Notes subject to guaranteed delivery procedures.
    [Show full text]
  • Answer and Defenses of Respondent Altria Group, Inc., With
    PUBLIC response to competition. Altria withdrew its e-vapor products because it concluded that they could not meet FDA’s regulatory requirements, because they lacked consumer appeal, and because they had lost money and had no short- or long-term path to profitability. The minority investment that the FTC challenges, which was designed to make JLI a more successful competitor by, among other things, helping it to successfully navigate complex regulatory hurdles and thereby continue selling its products, does not violate the antitrust laws. Altria submits that, on the full record, and in considering the applicable law, the relief sought by the Complaint should be denied. Altria’s subsidiary, Philip Morris USA, has for more than a century been one of the nation’s leading manufacturers of conventional, combustible cigarettes. In 2012, Altria established a new subsidiary, Nu Mark, to develop reduced-harm tobacco products, recognizing that adult consumers were becoming interested in e-vapor products because they could potentially provide some or all of the satisfaction of combustible cigarettes without the associated tar and without the stigma associated with smoking. Although Altria set up Nu Mark to compete, it did not have scientists or technical experts who were experienced in developing e-vapor products. After failing in its initial efforts to develop a successful product on its own, Altria undertook an acquisition strategy beginning in 2014. All of this was done at a time when the FDA did not regulate e-vapor products. Far from being a “threat to JLI’s market dominance” as the FTC alleges, Altria’s effort was a failure.
    [Show full text]
  • Despite Their Public Support of Voter Access and Opposition to Voter
    Despite Their Public Support Of Voter Access and Opposition to Voter Suppression Laws, Major Corporations And Business Leaders Are Taking Part In US Chamber's Summit on Equality of Opportunity Several Major Corporations Will Be Sponsoring The U.S. Chamber's National Summit On Equality Of Opportunity Despite The Organization's "Fierce" Opposition To Voting Rights Legislation. ............................ 1 Accenture ............................................................................................................................................................ 3 Altria Group. ........................................................................................................................................................ 5 Genentech. .......................................................................................................................................................... 8 Microsoft Corporation. ...................................................................................................................................... 11 Raytheon Technologies. ................................................................................................................................... 12 Several Business Leaders and Representatives Will Be Providing Remarks At The U.S. Chamber's National Summit On Equality Of Opportunity Despite The Organization's "Fierce" Opposition To Voting Rights Legislation, While United Airlines Will be Sponsoring A Discussion On Aviation Diversity.. .......................... 13 Discover
    [Show full text]
  • (PMI) in Mexico
    Philip Morris International Inc (PMI) in Mexico Overview of tobacco use in Mexico (estimates) • There are 16 million smokers (age 12-65) in México, 1 with an increasing trend among women. • One third of men (30%) and a tenth of women (10%) are current cigarette smokers.2 • Among youth (age 13-15) in Mexico City, over 27% smoke cigarettes (male 26%; female 27%).3 Overview of PMI in Mexico • Latin America generates 5.8% of PMI’s profits which are driven mainly by sales in Mexico.4 • “(One of) our three most important local brands is…Delicados in Mexico. All three gained volume and market share in 2008.”5- Waldemer, PMI CFO (2009) • PMI works under two names in Mexico. Both companies are licensed to produce PMI brands.6 o Cigarros la Tabacalera Mexicana, SA de CV (CIGATAM) is PMI’s local subsidiary as well as the largest cigarette maker in Mexico. PMI first bought stock in CIGATAM in the 1970s and they increased their share to 50% in 1997.7 In 2007, PMI increased its share in the company to 80% acquiring an additional 30% from Carlos Slim, a leading business man in Mexico and CIGATAM’s previous owner. 8 The acquisition gave PMI more control over the manufacturing process in Mexico. • Slim currently sits on PMI’s board of directors9 and maintains a 20% share in CIGATAM. CIGATAM produces the local brands Delicados, Tigres Rojo and Tigre Amarillo as well as Philip Morris Mexico brands including Marlboro, Brandon & Hedges, Broadway and L&M. o Philip Morris Mexico, S.A.
    [Show full text]
  • Altria Group, Inc. [email protected]
    UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASH!NGTON, D.C. 20549-4561 January 17,2012 Louanna O. Heuhsen Altria Group, Inc. [email protected] Re: Altria Group, Inc. Dear Ms. Heuhsen: This is in regard to your letter dated January 17, 2012 concerning the shareholder proposal submitted by Daniel Morrison for inclusion in Altria's proxy materials for its upcoming annual meeting of security holders. Your letter indicates that the proponent has withdrawn the proposal, and that Altria therefore withdraws its January 12,2012 request for a no-action letter from the Division. Because the matter is now moot, we will have no further comment. Copies of all ofthe correspondence related to this matter will be made available on our website at http://www.sec.gov/divisions/corpfinlcf-noactionl14a-8.shtml. For your reference, a brief discussion of the Division's informal procedures regarding shareholder proposals is also available at the same website address. Sincerely, Matt S. McNair Attorney-Adviser cc: Daniel Morrison *** FISMA & OMB Memorandum M-07-16 *** Louanna Heuhsen Vice President & Associate General Counsel January 17,2012 Rule 14a-8 VIA ELECTRONIC MAIL Division of Corporation Finance Securities and Exchange Commission Office of Chief Counsel 100 F Street, N.E. Washington, D.C. 20549 [email protected] Re: Altria Group, Inc. Withdrawal of No-Action Request Regarding Shareholder Proposal Ladies and Gentlemen: On January 12,2012, Altria Group, Inc., a Virginia corporation (the "Company"), requested that the Staff ofthe Division of Corporation Finance of the Securities and Exchange Commission confirm that it will not recommend any enforcement action to the Commission if the Company excludes the shareholder proposal (the "Proposal") submitted by Mr.
    [Show full text]
  • Altria Reports 2019 Third-Quarter and Nine-Months Results; Announces New 2020 - 2022 Adjusted Diluted Eps Growth Objective to Advance Strategic Business Platform
    ALTRIA REPORTS 2019 THIRD-QUARTER AND NINE-MONTHS RESULTS; ANNOUNCES NEW 2020 - 2022 ADJUSTED DILUTED EPS GROWTH OBJECTIVE TO ADVANCE STRATEGIC BUSINESS PLATFORM RICHMOND, Va. - October 31, 2019 - Altria Group, Inc. (Altria) (NYSE: MO) today announces its 2019 third- quarter and nine-months business results, reaffirms its 2019 full-year adjusted diluted earnings per share guidance and announces a new 2020 - 2022 adjusted diluted earnings per share growth objective. “Our core tobacco businesses delivered excellent third-quarter financial results,” said Howard Willard, Altria’s Chairman and Chief Executive Officer. “Our 2019 plans remain on track, and we reaffirm our guidance to deliver full-year 2019 adjusted diluted EPS growth of 5% to 7%.” “We continue to believe the evolution of the tobacco industry represents a significant opportunity for Altria. We marked major milestones in our transformation journey this year, including launching IQOS and completing the on! transaction. We believe that, with current adult smoker trends and e-vapor disruption, it’s an opportune time to expand the availability of these options.” “In light of these considerations, we announce a compounded annual adjusted diluted EPS growth objective of 5% to 8% for the years 2020 through 2022. We believe this new growth objective provides us the flexibility to make investments in noncombustible offerings for the long term, generate sustainable income growth in the core tobacco businesses, and return cash to shareholders through a strong dividend. We also expect to maintain our dividend payout ratio target of approximately 80% of adjusted diluted EPS during this period.” As previously announced, a conference call with the investment community and news media will be webcast on October 31, 2019 at 9:00 a.m.
    [Show full text]