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Altria forecast trails some estimates as sales volumes fall
[ATLANTA] Altria Group Inc, the largest seller of tobacco in the US, forecast profit for the current year that trailed some analysts' estimates as its sales volumes decline.
Profit per share in 2015 will be US$2.75 to US$2.80, Richmond, Virginia-based Altria said Friday in a statement. Analysts estimated US$2.80, on average, with some projections as high as US$2.86.
Chief executive officer Martin J. Barrington has raised cigarette prices to make up for falling sales as consumers quit or switch to alternatives such as electronic vaporizers. Consolidation may help companies maintain profit margins as the US market declines. Reynolds American Inc., Altria's biggest competitor, is acquiring Lorillard Inc. for about US$25 billion. That would put 90 per cent of US tobacco sales in the hands of two companies.
Altria's fourth-quarter net income rose to US$1.24 billion, or 63 cents a share, from US$488 million, or 24 cents, a year earlier, when the company retired some debt early. Excluding some items, profit was 66 cents a share, matching the average of nine analysts' estimates compiled by Bloomberg.
Cigarette shipment volume fell 1.7 per cent in the quarter.
Shares of Altria rose 0.7 per cent to $54.39 yesterday in New York. They have gained 10 per cent this year.