Altria Group, Inc. (MO)
Q3 2009 Earnings Call Transcript
October 21, 2009 9:00 a.m. ET

Executives

Cliff Fleet - Vice President of Investor Relations
Mike Szymanczyk - Chairman and Chief Executive Officer
Dave Beran - Executive Vice President and Chief Financial Officer

Analysts

Judy Hong - Goldman Sachs
Chris Growe - Stifel Nicolaus
Erik Bloomquist - JPMorgan
David Adelman - Morgan Stanley
Thilo Wrede - Credit Suisse
Ann Gurkin - Davenport
Christine Farkas - Banc of America
Adam Spielman - Citigroup
Nik Modi - UBS

Presentation

Operator

Good day and welcome to the Altria Group third quarter 2009 earnings conference call. Today''s call is scheduled to last about one hour, including remarks by Altria''s Management and a question-and-answer session. In order to ask a question please press star followed by the number one on your touchtone phone at anytime.

I would now like to turn the call over to Mr. Cliff Fleet, Vice President, Investor Relations for Altria Client Services. Please go ahead, sir.

Cliff Fleet

Good morning and thank you for joining our call. This morning, we will only be discussing Altria Group, Inc.''s 2009 third quarter and year-to-date through September business results and will not be discussing the status of tobacco litigation.

Our remarks contain forward-looking statements and projections of future results and I''d direct you to the forward-looking and cautionary statements at the end of our earnings release for the review of the various factors that could cause actual results to differ materially from projections.

As a result of the spin-off of Philip Morris International in the first quarter of 2008, our reported results for the nine months ending September 30th, 2008, reflects PMI as a discontinued operation. Revenues and operating company''s income for PMI are therefore excluded from Altria''s continuing results.

Since Altria acquired UST LLC and its smokeless tobacco and wine subsidiaries on January 6th, 2009, U.S. smokeless tobacco companies and Ste. Michelle Wine Estates financial results from January 6th through September 30th, 2009 are included in Altria''s consolidated and segment results for the nine months ending September 30th.

Unless otherwise noted, all financial data and the remarks refer to comparable year-over-year periods. For a detailed review of Altria''s third quarter business results, please review the earnings release that is available on our website, www.altria.com.

Altria reports its financial results in accordance with generally accepted accounting principles. Today''s call may contain various operating results on both a reported and on an adjusted basis, which excludes items that affect the comparability of reported results. Descriptions of these measures as well as reconciliations are included in the earnings press release.

Now, it gives me great pleasure to introduce Mike Szymanczyk, Chairman and Chief Executive Officer of Altria.

Mike Szymanczyk

Thank you, Cliff, and good morning, everyone. In a year which I think can only be characterized as challenging, Altria and its operating companies continued to deliver excellent results in the third quarter.

Altria reported solid adjusted earnings per share growth of 4.3%. Our cigarette segment delivered solid financial results, growing its adjusted operating company''s income by 2.1%. Marlboro continued to show strong underlying dynamics, growing its retail share both sequentially and on a year-over-year basis.