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RICHMOND, Va. -- Altria Group Inc. announced third-quarter 2008 diluted earnings per share (EPS) from continuing operations of $0.42, down 2.3 percent from $0.43 for the same period last year. This quarter’s reported results reflect lower SABMiller equity earnings due to a charge resulting from intangible asset impairments, a higher income tax rate and an increased allowance for losses at Philip Morris Capital Corp.
These factors were partially offset by strong operating companies income (OCI) performance by Philip Morris USA (PM USA) and John Middleton Co., and lower general corporate expenses. Adjusted diluted EPS from continuing operations increased 15 percent to $0.46 versus $0.40 in the prior-year period.
"In the third quarter, Altria’s cigarette business delivered strong financial results," said Michael E. Szymanczyk, chairman and chief executive officer of Altria. "PM USA’s adjusted operating companies income increased 6.3 percent and its operating margins continued to expand."
Marlboro reportedly delivered strong retail share gains, up 0.5 share points versus the third quarter of 2007 to 41.6 percent.
In September, Altria announced it had agreed to acquire UST, the world’s leading moist smokeless tobacco manufacturer. That transaction has passed federal antitrust review, according to Szymanczyk.
"This acquisition is both strategically compelling and financially attractive as it enhances Altria’s ability to deliver superior shareholder value," he said. "UST provides Altria with the leading premium brands, Copenhagen and Skoal, in the highly profitable moist smokeless tobacco category."
As for the full-year forecast, Altria reaffirms its 2008 EPS guidance. It forecasts 2008 adjusted full-year diluted EPS from continuing operations is expected to be in the range of $1.63 to $1.67. This range represents a 9 to 11 percent growth rate in EPS from an adjusted base of $1.50 per share in 2007. Altria continues to expect full-year operating companies income growth from continuing operations in the mid-single digits on both a reported and adjusted basis.