Altria (MO) 28 Apr 222022 Q1 Earnings call transcript

Good day, and welcome to the Altria Group 2022 First Quarter Earnings Conference Call. Today's call is scheduled to last about an hour, including remarks by Altria's management and a question-and-answer session. Representatives of the investment community and media on the call will be able to ask questions following the conclusion of the prepared remarks. I would now like to turn the call over to Mac Livingston, Vice President of Investor Relations for Altria Client Services. Please go ahead, sir.

Gretchen. Thanks, thank us. and for you morning, joining Good This our quarter CFO, Gifford, Altria's business Sal Mancuso, CEO; and will morning, Billy results. discuss Altria's first results. Earlier we issued press providing today, a our release latest The corporate at release, metrics presentation, and altria.com. responsibility are all quarterly reports available our

call stated, we're today, same to comparing otherwise XXXX. in unless our results the During period

that operating the Please Adjusted U.S. reported forward-looking and results Altria's earnings and accordance factors cautionary with remarks and financial release statements and results cause Accepted cautionary results for financial the altria.com. included Our could both various today's in and our reconciliations Generally projections adjusted at of today's release section repurchases items reports discretion Descriptions to review from at a measures end with subject exclude results contain forward-looking reported comparisons of of Principles. earnings and of future that payments to the Altria affect differ are website Today's results. special Future projections. basis. Accounting non-GAAP actual its the statements remain and on results. various call contain Board. materially on will share in dividend

today's over specific to references XX Billy. refer call remarks consumers all within age tobacco or a of years in Finally, existing adult consumers I'll that, tobacco the turn or segment or consumers category to to tobacco older. With

strong to full are Good for to morning, on off their deliver us. a year start to year against Mac. and Thanks, and you our track thank the We're plans. believe businesses joining

lead toward a we a our environment, adult smokers future. progress to continue make performed the businesses Our of well and in macroeconomic transition tobacco vision to responsibly smoke-free to challenging

disrupted review Ukraine. high the trips backdrop a consumers. decreases price overall routines impact and retail discretionary of index short-term income inflation as in consumers' a U.S. cases and pressured X-year throughout surge by in the higher the were and with tobacco its gas of patterns, purchasing volumes. in macroeconomic Omicron quarter prices March, start resulting invasion Let's In levels consumer January, on exacerbated Increased of tobacco and reached the the Russian

rise rate first consumers. offset at of X% inflation X% X.X% wage quarter employee the to improved some unemployment nearly March, XXXX. the The growth by increased was in in However, compared for was down Total the end by of metrics X% March wages grew average inflation. partially in from and

toward some For wage including tobacco growth occupations, occupations over-indexed outpaced inflation, that consumers.

For pertaining jobs for for grew example, materials XX% nearly moving. production-related and XX% wages transportation and jobs to

refunds. pressures federal some inflation consumers and issued however, offset the IRS refund quarter, effect continue payment the inflation tax for its higher year, were for balance on persist tobacco income to of of first expect Additionally, the the by the XX%. approximately will federal to We by do by also tax monitor In we average increased the income consumers.

consolidated our from growing operating strong fewer in smoke-free earnings with the funding maximizing driven delivered X.X%. our dynamic performance Altria earnings EPS primarily first quarter to companies results. Moving by by share shares outstanding adjusted this diluted Adjusted was higher and per income partially growth in environment, to smokeable Marlboro balancing while the investment. our adjusted of lower segment, ABI continued investments we strategy appropriately by offset execute In products. growth in combustibles, products profitability of

include provide growth these performance smokeable of equity strong sequentially. These solutions deployment through stable continue in strong X.X% made we well smokers. quarter continued vision for multiple options We data capabilities retailers with support for behind believe more smokeable believe designed strategy. provide revenue which deliver the position right program, tools investments as USA's the brand retail our period manufactured store-level to share to increased efficient profitability with PM and We We navigate to smokeable off-invoice First and management adjusted environment our the was current programs enables its resource shareholder to trade segment have retail to analytics Marlboro among reflects and support and with as Marlboro us tools our OCI believe this businesses brands. share supported the returns. Marlboro's

Turning to our smoke-free product portfolio.

excited performance are retail, old quarter. nicotine on! in of and shipment reaching reported percentage We oral tobacco by X.X%. share volume points, cans the X.X to XX first of by pouches. nearly doubled increased the At on! million on!

purchases been primarily shared trial. we existing tobacco share As and CAGNY, on! repeat from consumers on! driven at has consumer growth by increased

of category that the a percentage encouraged first are nicotine retail reached The share level, grew tobacco continued share oral We dynamics pouches these of category first quarter. the total oral At XX.X in quarter. the into X.X with points the on! well be XX% space, continues than this of representing to year-over-year, it the We brand the continues product U.S. more a in perform growth. in regions highly believe and competitive all to points

with the determine FDA. should these FDA a applications the marketing believe portfolio we on! of premarket As entire reminder, appropriate that health. our And pending public for tobacco of products remain is the for the the protection

and risk for working of provide are on! for that brand the the period in smokers differentiation volume the result We a believe versus e-vapor, increased educating X% MRTP applications points category products. actively modified tobacco impactful year-ago in as to volume channel. important total less and estimate store and harmful increased In on increased product transitioning sequentially vape would We ultimately also tools of claims we XX%

FTC's U.S. of Trade FTC judge in on investment court. to There our challenge the and JUUL by decision the availability. to tobacco, to product subject work plans, In are heated FTC. PMI informed IQOS as teams FTC you keep we to change developments in continuing circumstances appeal by expectations that claims. Altria reentry no regarding is law our administrative decision federal subject the an is warrant. in is appellate Any favor found remains In The with to JUUL Federal minority will on IQOS and February, of and appealing the entirety Commission. the Our dismissed

allows Drug a The circumstances creation this to and a become unlawful responsible this product last include President products regarding smoke-free bill this nicotine contains Act a the The product product synthetic the and In Cosmetic environment. products synthetic products FDA-authorized with product FDA the solely on issue market to a creates cigarettes FDA the of that combustibles, bill Moving nicotine, to month after those that certain bill signed in only currently review XXX denial on legislation standards is important definition by the to an that marketed the nicotine is tobacco synthetic on within period, of bring products. marketplace, they nicotine. the those order a month for the FDA FDA to bill's synthetic May products. manufacturer FDA's days menthol has keep thereafter proposed nicotine to the Food, of issued of under including enforcement for flavors the by provided submitted enactment, it updating discretion. PMTA regulation within step PMTA track the manufacturers regulatory Biden those the marketing for exception a products consisting and time believe where XX. subject market products Unless for the We of characterizing and indicated toward grants in that cigars. a have a period

to to multiple prohibition legal input. in the lack Underage reduced a reducing smokers underage seen of public oversight the a regulatory the efforts and markets lowest manufacturers that Prohibition harmed appeal authorize as develop FDA products prevention. and lack several This and into all criminalization cannabis and pushes illegal smoking As adults potentially provide smoking the FDA products consistently provides has level can that and alternatives to improving to rule-making is option have believe with policy equitable a of is and generation prohibit opportunities to we harm public demographic health. array process stakeholders alcohol backgrounds routes. at approach reminder, means and have sale steps failed. transition across for We and an must better

smoke-free marketplace to an the millions of We We're engaged from optimistic can away unprecedented the our future actively have products to process. remain the providing harm-reduction believe throughout we in smokers to that We opportunity shifting move U.S. expect started to in encouraged the away the but be smokers a the reduced-harm they authorizing products, about has cigarettes. from to authorized of way FDA needs FDA as We lead be perspective done build of consider cigarettes. that more in

environment and results. tobacco on a fierce delivered smoking. to results to businesses challenging and ability be this resiliency to our Our in Their provide our to me continue passion, detail not could beyond give dedication turn employees. the in extraordinary Sal it over and the more now environment. move I'll done our talent business determination of And dynamic confidence and without

inflationary the on invasion Thanks, like exacerbated Billy. a the Ukraine. was discussion to by of Russian with begin which I'd environment,

risk. operations potential work the monitor supply a to we actively and chain, to we from our to and continue mitigate teams, these impact the are material of events. Thanks experienced our have not We adverse hard to impacts working

While affected suffering our the the Ukrainian of people monitor go all to our to by and company will the out continue hearts situation, those to war.

businesses. segment by segment strong adjusted first once quarter, XX.X%. segment price margins OCI the its reported expanded net again. Moving grew smokeable excellent the of In to products realization to X.X% OCI The our and X.X%. The delivered adjusted its performance also financial

to domestic and over declined trade domestic for volumes believe factors. cigarette industry period. We X.X%. movements the that we any longer the quarter trends by quarter the can for segment volumes by First important by volume smokeable in other influenced declined segment decline cigarette analyze various X%, rates volumes reported be it's over period that factors, When and declined estimate same adjusted term one X.X% as first cigarette inventory

continued Marlboro volume fact, quarter, marketplace, and and In adjusted the the retail X.X% period declines during of demonstrated sequentially In stable smokeable the category X-year strength for was Marlboro and for X.X% by industry orders covering cigarette average in consumers. or over brand. received and Reported environment exemptions first quarter regulatory XX% affairs decreased rates To successfully the decline regulatory resilience In the movements. sequentially segment were in XX.X%, having of date, first market smokeable a to of team, the cigarette Middleton to total our previously X.X%, respectively. that iconic period. first quarter share Mild sequentially we down are the due the and macroeconomic dynamic Marlboro's the versus to deep share the and growing X.X affected category quarter. encouraged increases products. strength maintained In its results, were primarily ago believe contributions premium to XX.X%, discount discount segment in discount, by X.X with in year-ago. segment is quarter, navigating cigar of mentioned year premium driven provide of primarily FDA up X.X We driven the its & the versus to by the brands, volume of the increased support the And Black tobacco leadership its shipment strong also financial share continued the first among cigars, consumers inventory share from first Middleton factors trade the XX.X%, in volume.

product earlier, and cigars course, in flavors Of mentioned continue Billy its potential Middleton's the we to standard portfolio. as on characterizing monitor to FDA's will proposed impact

expect in the perspective be our providing We actively process. throughout to engaged rule-making

adjusted inventory trade primarily total the to unchanged. the oral total At and X.X% quarter, first and Moving the products estimate to segment, over past behind tobacco we that were movements moderated the investments margins volume the tobacco adjusted oral OCI adjusted X.X%. oral volumes growth OCI shipment When differences, Total segment volume for X level, increased due segment industry tobacco decreased months. calendar reported to on! contracted in

in pleased challenges with Turning down We year. as and Retail strong oral pouch periods $XXX of first in prior in a by share declined nicotine the as of MST We growth consumers. been declines offset on! the to quarter investment the declining in of high-margin category, tobacco equity and we smokeless X.X tobacco segment the from difficult adjusted points but percentage products quarter, this offset share the to result facing to recorded observe comparison in remain has continues income MST remain performance the about the volumes as for macroeconomic oral the first tobacco continue gains performance the generate for the steady of moist overall million versus earnings ABI. on!. XX.X% our Copenhagen category, We significant excited segment

our and view we previously long-term maximize shared, have is the investment, as of ABI to for goal As investment the financial a we stake value our shareholders. our

the totaling Moving million our financial vision shares approximately committed creating quarter, value outlook. long-term pursuit remain billion In approximately through capital and We significant and we the $XXX million. to and allocation first paid returns. XX.X capital in to our of dividends shareholder $X.X repurchased our

currently range the guidance to range reaffirm $X.XX under EPS full diluted approximately X% our year-end. to $X.X from in a which billion $X.X by in XXXX diluted deliver have growth We base expect EPS program, $X.XX adjusted authorized represents $X.XX. to to we X% billion of remaining This year adjusted share XXXX. We repurchase an of complete rate

toward We expect XXXX adjusted continue weighted diluted half the that year. be second to growth of will the EPS

additional in up underage for impact first agreement wind by virtual other we This it and Texas. reducing to areas. to energy farm At Whilst use power your XX% a social remain questions. renewable electricity to important project support to Altria, contributing expect positive I'd electricity we our recent and reducing will targets ESG company that have for in committed ESG We're I most XXXX. reduction are and will to environmental ahead the harm When on climate those schedule. committed will purchase recently agreement of our we a we'll announced operational significant produced that, and emissions With opening advancements Before project hit our marks energy Billy to new our issues our project X is XXX% like gas to grid, to toward address, comment Q&A, progress. make the and the progress science-based take greenhouse bring operational, to up, wrap happy achieving be targets, we by environmental action. proud renewable of

and our that While remind items. I'll include calls also reconciliations which are earnings non-GAAP compiled, usual are the on pricing, quarterly inventory our and other altria.com. release We've metrics, being posted available you today's

the period. Operator, do open we any have questions? Let's question-and-answer

Instructions]. [Operator

We questions community first. take investment will the from

from comes Growe question first Stifel. Chris Our from

I you. for just had a question

at what consumers -- guess I those there's was is visage that I And quite the this sorts this think moving you Marlboro as been about the drag it doing -- at point volume? at think -- had look today, related that, resilient Marlboro's different a you to of wages look a be quarter. as way areas unemployment, that, expect as you're within would that You've more it that's less around a a where be the an of of little of of year Are little of headwind bit kind things, better. franchise, to terms what Obviously, point prices, Marlboro, were to you macro in showed, blends occurring. I whether a some your you seeing share on within But gas there example?

the question, Chris. take for Thanks in them order. I'll Yes.

our wage to So industries think standpoint, see benefited we that's highlight from car a has why because we'll the we that truck they're the on consumers then were of And a the Certainly, excited something gas product. and it's in purchasing see and prices continue their resilience that It's I of usually to our consumer. tobacco our going impact filling to number consumer. inflation wanted up don't watch.

the tobacco to continue in seen the something with we've watch, first that but consumer. we'll pleased it's feel quarter So through resiliency the we

with share the virus. back far income that you of And a pre-COVID, excited if can under had that the that And brand But still marketplace. seen the the that see benefit you stability gave discretionary Marlboro little has in pointed COVID think the And we from of back, benefited up. strength then that entire held having period, Marlboro. to benefited aspirational we come during extra go of Marlboro. we as pressure, And Marlboro's income bit we've the As through we as brand extremely the COVID had we Marlboro, the pandemic. I as the of proceeded consumer discretionary we're through

of see movement. a little bit You always

consumer in you as about would XX% make over a a nothing that's the movement, point. has but it this of they bit That's buying at But loyalty. a a time marketplace. you I you If of purchase think the every cigarette for highlight brand, it Marlboro little that see

one Okay. had I just other question.

could And example, the I away could is you shops, just And in think And driving for I that guess that consumers? movement mean for what guess, on movement to that? from the to vapor. I what traditional be effect, vape based moving into dynamic future JUUL of talked that about by outlets? that a consumers

growth. What we trend to vape highlight. the saw in was was where the shop there to we It highlight tried no channel. Yes. some Again, of

saw growth to highlight wanted Just where the sequentially. we

the back and some seeing e-vapor have process it think denied. look I FDA, make and XX to regulation, some the if entire that category, transition decisions coming are at I you see a highlight entire step of in of we've think tried should as the category these will to over and bit what products as we FDA all are the through products the started months is by and a of year next be some under

moving to is role to once reduction believe will marketplace. bit. those play important so and we we an forward look And U.S. around to harm consumers e-vapor be can FDA-authorized a that continue total a the What in get in

next comes Cowen. Azer Our from question Vivien from

months news maybe the last XXXX it long given the So Billy, helpful. been over has anticipated, XX be certainly April menthol target. the will

have just guys context. of disclosing dimensionalizing big how pretty the category menthol, been your share but consistent category the is You in broader menthol in

Yes.

from is point your it to page, our represents USA, marketplace an non-menthol. consistent of a that our X/X from you PM about see metrics share and industry So in standpoint X.X% the menthol pretty it's across can menthol versus of on cigarettes industry

question IRS other we've is unique That's really my the call call helpful. from relative coverage. hearing Understood. a been out a to of That's what out. next on My bit under companies

kind you pressures for of offset that one-quarter this message kind thinking the is annualized? does onetime benefit? consumer? kind a to of you Like the are guys thought that? of of about kind how Or was is inflationary a that it So Like that,

Yes.

a When it, Vivien. form extent, checks stimulus, it government to think up. certain are think you a you refund as can I the actual of think of about

As checks quarter. far the it gets that refund as But first the plays for not second through we out in to -- want we'll everybody how highlight see their our quarter, consumer. certainly

think out, was piece that was would that throughout we that the anticipate inflation. year. consistent you would benefiting the be something be bigger a I saw call and consumer, though, wage And that's it, the and our would

Pamela from comes Stanley. Morgan question next Our from Kaufman

segment evolves? tobacco strategy share about that you you elevated profit give and behind towards update oral point shift a drive for that a Performance on! level how your market on!? we an it or goalpost particular in continued investment of the think should How there in reflects this a can Can on segment? And would more of is profitability focus to

Yes. I Pamela. appreciate the question,

But profitability I more and period, with we the really promotions. invested remain some in our while maximize quarter. make to in of analytics those the think it to smokeless Copenhagen, term long been in was we first term, saw But the you once see And oral be wanted capacity category in when consideration point, all in now. oral within investments our about on! of in we'll time. margins invest products. its long making from investment to started that believe, choices And our alternative certainly, got the strategy advanced period the quarter-to-first for to fund to achieve sure to of past -- continue constraint, it's We highlight for the to that category. in we've over you a What significant strength nicotine a responsible you'll the saw volume for think in we're tobacco-like making manufacturing targeted that the of tobacco, they're comparison that using still doubling your moist with to when along, growth. almost can we trying year-over-year, we've pouch set we're the the period consumers investment is growth we we

discuss competitive can segment to light the then at cigarette you're talk to levels. in you're the the current thinking And environment. category how headwinds? remain some price about and share Great. given Can you observing what historical landscape relative the the from gain about category down pace, within higher you discount consumer cigarette a deep The of consumer of trade gaps continues within wide

Yes, sure.

what trade exactly gas you whether is mobility, seen which is as the that's see income some prices discretionary through Pamela, you'll under you've down. pressure, what highlighted, of or or Some inflation comes even

barbell. think end cheapest you that buying if as cigarette think a that think a in that, of of total the the about consumers about are I it There's always a bit bottom of the are group, at group consumer store. the

see that occur. And so you

But You time. the we through in company, about saw under the benefit pressure. of experienced a rock-solid premium-focused we're and this, when income think discretionary see stability we wasn't you it the is Marlboro Marlboro that so way much

question comes Gaurav from from next The Barclays. Jain

talking of are very are couple in wages #X professions different is questions a how here. Billy, the So about you so trending across Slide which interesting.

I inflation are higher different the Now to and is states similar lens trends better a seeing versus states in lower? wage different if and maybe entire is states, apply volume where different inflation of you inflation sort the wage in wage U.S. where

highlight Yes. It's to do to the for a we but that level, to categories, -- consumer, disclose wanted you. of of that's highlight why wage We wage question. to and inflation has where try has an couple see we inflation benefited back we that the but interesting where and don't

we data through If and can behind everything reserve were is Sure. will wage year, jobless likely see of we go still the that as to because and curve. weekly say inflation this accelerate I just federal

we spike. So difficult volumes, cigarette which then then gas in that are which are fell comps, minus should -- which QX, price X.X% expect the

improve So start year the as progresses. moderating should and here from it

Yes.

openings hypothesis to macroeconomic how at goes wage I Certainly, respond In your is it think consistent least I expect guess, that. see on we very increasing, the to be and how the to of point, throughout your would environment, unemployment job dynamic. we'll inflation year.

is the though, tailwind. other side, think the I

gas see trends. where and the year gas part go through of highlighted We'll remainder prices. inflation prices You the where

headwinds highlight think it's the why tailwinds we and very were we that's to of and I So wanted dynamic, some that seeing.

market nicotine FDA and done. what And the coming to synthetic the Sure. has

a playing how out entire to and that the few your category be in will in months do the benefit as nicotine well? synthetic like next you see this volumes market, So

Yes.

And total a times looking exactly decisions to think how moving about put you seen portfolio other place categories. because we around. of us you've play FDA when force really one in at highlight at put So category the approach the that's consumers Gaurav, is consumer nicotine, and them couple why, and that in the

we portfolio in approach the having important. so believe is And

And so the products products take out play for and products XX highlight you months it make Those for FDA, can make made depending have in in the consumers could not a and year transition be of category, some next will e-vapor through decisions we do other that bit that that, some to why that's on that other a the do or consideration be for their either category the set. products not. it by categories as at they decisions come e-vapor

for I in sneak And if Sure. last Sal. just one could a

interest hasn't. So to will periodic it income when And item go benefit. in this has rates I line Sal, there's that become it net think up, benefit but used a which a your constant P&L, headwind, been

this work? So line how does item

you that? repeat Can I apologize.

The net income, that expense. and think your line to linked interest income and pension, periodic item, I which is benefit

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how So do…

the the time. That's you of which, reflection as gets also performance That's and pension our in strength to over a the strength sorry of in interrupt. plan our of plan, a overall funding amortized pension reflection I'm some our of know, -- favorability

had slight it benefit are to our So has a that, in P&L. correct you

Goldman Our next Bonnie question from comes Sachs. from Herzog

of the environment, I price cig gap. your concerns I premium actually volume the to your back some Marlboro wanted given especially -- your circle investor given wider in volumes, about this just on volume

us results more for So line to in your share protect first, then expectations? you around Billy, were some share. highlight volume maybe with us your strategy And your QX for your and could if color

balance For stepping bring the select special franchise? pricing a are your us more then highlight to your keep a understand of volumes? aren't price-sensitive you promotional And how like Marlboro leverage spending And during and up kind some bit I consumers. to times better think I'd your maybe for of instance, consumers guys better then you why in striking maybe just for you these between

Bonnie. Yes,

it. to There try parts but address multiple I'll were implemented. it strategy I'll we the try to So with address there,

you've for seen through with highlighted you Marlboro the performance think we and time. is I of what Marlboro rock-steady

the revenue the call I way about and and you think marketplace, growth when we more and for think closer what consumer provide provide in advanced we're it, having management companies to analytics to consumers. closer is if able the promotions you being it the the the to individual we're promotions, using most pricing highlighted get --

well we economic than geographic have as for invoice. retail through that's other states, solutions to whether so the to versus options of trade the different multiple trade store-level of as because, And marketplace health more retail manufacturer where the our consumers as ability multiple programs, total you under solutions, know, have have for partners, really in a solution states, certain are consumers

growth would getting X And remind list we're efficiencies that advanced so components. the revenue I through It's and our price made analytics. you, our it's and management realization, just of is price up our

of and promotional Marlboro the process. the about you steadiness the you when think efficiencies through coming totality, So see in that

be and it's promotions. way spend the us so targeted we to And more allowing with efficient

I highlighted just one other Bonnie, opening would in point, add we which our remarks.

I premium just grown the of as premium strength Marlboro's programs tools think and the the of of effectiveness share category, where the reflection of within mentioned. a performance has Billy

of They've so been in declining I very smokeable to terms business, I in that's industry your long All for volumes. it's guess the time. about decline mean, right. right secular mean very, think Yes. a way I

you drive, you're in whether it's going or to margins. to your feel So be growth to mid-single-digit the way continue you're that trying do income environment, with that. low And managing this and this that pricing is operating and expanding offsetting good, even able to

Yes.

see the I the you through with quarter. think results first

When quarter. a macroeconomic you've the it would highlight, And were tough seen with that, nicely. elasticity, precise. impacted holding standpoint from Again, by we us, tools from other available volume, look much a we total on pretty the -- advanced a from was see can to navigate more I I standpoint, that elasticity. think you was price price analytics just XX-month that we we decomposition be industries you to a very firm and have it's and be able at provide the can of

You switched can just around see through macroeconomic factors that time. it's the really have

quick one industry Can frame what this color guidance. are decelerate total helpful of you cig further on just be on clarification that it mean touch that final of volumes volumes? on assumes to assuming your terms And in year? kind you this. I Any would all just of

you're we for And that I don't volume appreciate know provide. Yes. Bonnie. guidance I looking it, that

think things reason what of consumer this give the our consumer to with they range want to provide to are I for change guidance able we marketplace, need. we that And the going know dynamic is base. be a we

And components range that's of there is we component, put are Volume guidance multiple there. guidance. so but into that one out why a go that

I one bearing our on And this to is highlight the through just -- in comfortable how the feel macroeconomic eye So guidance think an consumers don't keeping environment. It's appropriate. reaffirming factor, we really really quarter. about it's

Our from from next Priya comes question Ohri-Gupta Barclays.

on if you the could your provide outlook Sal, market. with for I us just was wondering some refinancing thoughts

thinking net against then of $X as I over the little ABI. expense maturing across from early about recall, for And how one received bonds greater do that portfolio? XXXX. and a your have investment other management later perhaps maturing do you serves dividend You in you're hedge interest this opportunities debt year billion euro If have secondly, you your a

refinancing in we need about dollar? that refinance sort of the to euro think versus should how of sort in strategically, So

Sure.

So questions take I'll in order. those

going is us way that strong balance I for First, the continue forward. respond manage we sheet I'd a to your that question to guess initial critical it's

maturing part of in do in way flexibility debt. interest some impacted the towers transaction. And balance and we we with year, have extended our debt, that the is maturities last of We're of so that did tender forward capital low we have which we know, we're debt going refinancing manage results to of we how by the ability of you manage pleased dynamics the allocation, treat sheet debt. market part As our less

refinancing with off the the think that's euro -- maturity. to the to how answer same we existing as best of it's do goes debt paid But that's debt handle necessarily the I'm coming that or We'll way analysis. and through the not coming coming determine such. due. And we'll going handle that, cash course, to So forecast out whether about for will that's analysis do

You being balance due. is or we how a are in that forward markets, ABI think managing And thinking refinancing be about whether the correct to hedge comes we receive. about or against natural it we do dividends across it debt flexibility managing our sheet various have opportunistic we're that as going can

from a Jain we from question And Barclays again. have Gaurav

updated quick a how ABI Sal, thoughts about the on thinking stake, believe, any on Just are question like you it.

really new say. to There's nothing

to continue our stake. perform to We ABI related analysis the

opening in about spoke our investment. it's financial remarks, a we As

Our focus that value. shareholder is on maximizing long-term for the investment

and do nothing continue there's on the report analysis, We itself. new to to the asset

will media question Street Maloney take from We Wall now Jennifer the from And comes questions representatives. from next our Journal.

were see implemented a California I if you of ask menthol switching expect the ban wanted state to patterns either in about would nationwide. or to that consumer

would to your overall see cigarette you you to see of expect to what if would Marlboro? Newport First net on business? And smokers so, impact switching all, expect

Yes.

I think say. it's tough to

using products outright think consequences were either marketplace, the the alternative products. go of an menthol to unintended ban an the to consumer look the ban, menthol, cigarettes of or some as will hypothetical under highlighted market, I outright with we or alternative non-menthol there if cigarettes to illegal for the are that either certainly, your in

will where tough So say it's to that go.

cigarettes. on of limited they research, that some would to look convert the I at research non-menthol it, think some if there's say you but would

I than allow want know is least alternative products is at back, the we to if move hasn't through a reduce alternative that potential approach focus The seems have be products think to have and should and harm. better better an better prohibition, you these worked. like ban. That here, to history, outright consumers step the that point the though, to approach

on! them One And quick Marlboro would of a cigarette follow-up. in What expect products Marlboro specifically any or the to you smokers event would RECONNECT JUUL like menthol products menthol you switch brand Gold or to market to?

we Yes. really move consumer out that and the support look to, the our to as and see what down We We'll look approaches proposal the would to have of to menthol. how vision said, wait really to continuum comes risk. it

certainly, approach with would consumer's are And that's ultimately so that it But the the way products choice. the -- it's the we marketplace. alternative in

turn I time, this closing to to would back Mac comments. for At call like the Livingston

Investor free contact joining for all the you Thank Please morning. feel us have further to questions. this if you Relations team Thanks again.

does participation. you your for This Thank conclude today's program.

You time. a day. may disconnect great Have this at