2010 Earnings Preview: Altria Group

Source from:  The Associated Press 04/21/2010

Altria Group Inc., owner of the biggest U.S. cigarette maker, Philip Morris USA, reports its first-quarter results before the stock market opens Wednesday. WHAT TO WATCH FOR: Any rebound in the number of cigarettes sold, which has declined steeply industrywide in recent quarters as tax increases, smoking bans, health concerns and social stigma make the cigarette business tougher. The Richmond-based maker of Marlboro cigarettes, Black & Mild cigars, and Copenhagen and Skoal smokeless tobacco products has said it expects 2010 to be challenging and that continuing economic pressure and proposed state tax increases could hurt tobacco sales. Its top-selling Marlboro brand lost volume and market share at the end of 2009 but is expected to grow in the first quarter on aggressive promotions and discounts on brand extensions. That could, however, hurt its profit margins. WHY IT MATTERS: Rebounding cigarette sales could signal consumers are adjusting to April's 62-cents-per-pack federal tax hike, which most cigarette makers accompanied with price hikes. WHAT'S EXPECTED: Analysts polled by Thomson Reuters expect Altria to earn 40 cents per share on revenue of $3.84 billion. LAST YEAR'S QUARTER: Altria reported profit of 39 cents per share on revenue of $3.81 billion. Enditem