Cigarette maker Altria's profits up 38%
RICHMOND, Virginia (AP) — Cigarette maker Altria Group Inc. said yesterday its first-quarter profit rose 38 percent as Marlboro took an even more commanding share of the market and Copenhagen smokeless tobacco also made gains.
The Richmond-based owner of nation's biggest cigarette maker, Philip Morris USA, said those price boosts, gains in its cigarette, smokeless tobacco and wine business and cost cutting helped it weather current economic pressures.
Altria continues to perform well despite high unemployment and low consumer confidence, as well as an intensely competitive tobacco market, CEO Michael E. Szymanczyk said in a conference call with investors.
Marlboro, which sold for an average of about $5.42 per pack, gained 0.3 points of market share to end up with a record 42.7 percent of the US market, driven by its menthol and special blend brand extensions. The brand helped Altria's cigarette sales excluding excise taxes increase 5.5 percent to $3.4 billion during the first quarter.
The company says cigarettes sold fell less than one percent to 34.1 billion from last year's quarter, when retailers and wholesalers cut their orders ahead of a one-time federal tax on inventory.
But Altria said that, when adjusted for last year's inventory cuts, its overall volumes fell about 11 percent, compared with its estimate of a 10 percent decline for the whole industry.
Marlboro's volume was up 1.6 percent, while all of the company's other brands, including Virginia Slims, Parliament and Basic saw declines in volume and market share.