Get Ready for Altria's Q3 Earnings (MO)

Minyanville.com

Altria Group (NYSE:MO) reports Q3 09 earnings tomorrow morning (Oct 21st) and Minyanville.com believes the call may be "Smokin'".

(Minyanville.com) Tobacco giant Altria (MO) is scheduled to report third-quarter results on Wednesday morning. The Richmond, Virginia-based company is the largest player in US tobacco manufacturing, with just more than 50% market share. Its nearest rivals are Reynolds American (RAI) and Lorillard (LO).


marlboro manWhether you like to huff, puff, or spit, Altria has you covered: The company sells Marlboro cigarettes (the dominant brand with 41% market share), cigars, and chewing tobacco.

The Street expects Altria to report a profit of $0.47 per share for the third-quarter on revenue of $4.66 billion, according to Briefing.com

When the company reported second-quarter results on July 22, Altria said that its profit increased 8.6%, boosted by its acquisition of smokeless tobacco company UST. The company also benefited from its stake in SABMiller, the world’s largest brewer, and lower general expenses.

Cigarette earnings increased 6.7% while volume dropped 6.8%. Marlboro’s market share fell 0.6%.

“Altria has taken more than its fair share of the industry decline,” says Morningstar’s Philip Gorham, who covers the company. “Marlboro is priced at the premium end of the market. So smokers are both quitting and switching to cheaper brands.”

To offset consumption decline, Altria has been raising prices. “In the short-term, that has caused problems because of the economic downturn,” Gorham tells us.

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