On the Call Altria Group CEO Michael Szymanczyk

Source from:  AP 04/22/2010

Like other tobacco companies, Altria Group Inc. is focusing on cigarette alternatives -- such as cigars, snuff and chewing tobacco -- for future sales growth as tax increases, smoking bans, health concerns and social stigma make the cigarette business tougher. The nation's biggest cigarette maker, and No. 2 Reynolds American Inc. have both used their flagship brands on new products called snus (pronounced "snoose") are teabag-like pouches that users stick between their cheek and gum. Still, smokeless tobacco is a small business compared with cigarettes, and smokers haven't exactly embraced snus. In a conference call with analysts regarding Altria's first-quarter earnings, CEO Michael E. Szymanczyk talked about the company's outlook on Marlboro Snus, which expanded nationwide at the end of March after testing in select markets beginning in 2007. QUESTION: What are some of the early lessons being learned on Marlboro Snus? RESPONSE: It's very early. We're just in the stage of gaining distribution and getting it positioned on the shelf broadly. We do have some learnings from test markets relative to engaging cigarette smokers on this subject that we will be putting in place. … We feel pretty good about the potential for snus. We've said for a long time we think this will be a methodical development of a business rather than something that happens rapidly. … It's very early for us to read anything on this. Enditem