Altria Group Inc. has reported a 28 percent rise in profits during the third quarter, as the tobacco company’s sales and margins improved and costs went down.
Altria, which manufactures Marlboro cigarettes, has managed to perform well in the last few quarters despite declining cigarette volumes due to the rise in demand for smokeless tobacco.
In the company’s smokeless business, earnings went up by 65 percent, mostly due to 16 percent volume growth aided by its Copenhagen division, as revenue increased by 11 percent. The company’s share of smokeless tobacco market increased 1.9 percent points from last year to 55.6 percent.
The parent organization of Philip Morris USA posted a profit of 1.13 billion dollars, or 54 cents per share, going up from 882 million dollars or 42 cents per share one year ago that included 6 cents in write-downs and other costs.
Revenue went up 1.6 percent to 6.4 billion dollars and revenues net of excise taxes increased 3.3 percent to 4.5 billion dollars, as high prices offset low volume.
Analysts surveyed by Thomson Reuters in recent times had predicted earnings of 52 cents on sales worth 4.42 billion dollars.
Gross margin went up from 36.3 percent to 38.7 percent.
Cigarette
earnings increased 15 percent, where revenue rose 1.8 percent despite
a drop in volume of 2.4 percent. Retail market share dropped 0.1
percentage point to 49.6 percent, even though Marlboro’s share went up
0.7 point to 42.6 percent.
