Altria (MO) 25 Apr 242024 Q1 Earnings call transcript

Good day, and welcome to the Altria Group 2024 First Quarter Earnings Conference Call. Today's call is scheduled to last about 1 hour, including remarks by Altria's management and a question-and-answer session. [Operator Instructions] 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.

Savannah. 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 the Please Forward-Looking and factors Cautionary remarks and statements cause cautionary for the Our could today's and projections release section to review from at end results contain forward-looking of of earnings future differ results. projections. actual Statements various materially

Future dividend report principles. to our U.S. payments our and discretion We accounting subject accepted share with repurchases Board. accordance generally the remain financial in results of

basis. reported our Adjusted comparisons altria.com. included exclude that will affect Descriptions reconciliations measures release items results. and results various on website Today's on call both adjusted contain special with these results today's earnings are and at operating non-GAAP of in financial a and reported

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

are we morning, challenging pursuit environment. businesses In profitable to continued We full-year joining you thank early meaningful track progress continued well saw environment, from an the in momentum and our absence regulatory spite made plans. perform our on of to in Good for deliver effective traditional NJOY believe of against Mac. of Thanks, and and vision, businesses our us. highly tobacco a

of investment in share of shareholder delivering subsequent the of on continued in our We sale ABI March. the our and our maximizing and portion the with our return program also demonstrated a returns repurchase strong commitment to expansion investments

on Sal, turn quarter investment. who behind our our to the detail further then progress, financial outlook. our first NJOY's My on the I'll the remarks of early and category e-vapor partial enforcement morning financial on state encouraging it from commercialization, sale and information on! results the will results momentum of will continued over provide additional focus this and ABI

Let's ownership, year-end. we NJOY broadened to excited e-vapor first And to expand in quarter, over begin quarters potential the by and with X stores In full market. about we U.S. XX,XXX NJOY's expect legal e-vapor we After our of the approximately business. remain distribution its XXX,XXX stores. to

also first NJOY's visibility rollout retail optimal program, We will continued of space retail. we fixture help NJOY product which trade believe at achieve the and

of premium fixture year. than this more resets options for e-vapor Today, XX% first the positioning expect majority the secure contracted completed NJOY. have stores And to of in the we half fixture that chosen in be of

each expanded quarter consumables generate first To vapors X.X was the months, smokers in NJOY. that and from of at NJOY, tried and and share offers adoptions trial of promotional of saw retail grew share retail NJOY's in X points have of seen past signs and share early longer-term X.X the up points results. quarter, promising we have we in the sequentially,

limited number quarter, first believe higher a retail appeal the account, the one grew we we to share account once share the period. variety settling than of retained retail the these in product. percentage versus X example, promotions points try in of XX% speak In over reduced and year, over consumers the period, pre-promotion NJOY's X results the of promotional NJOY percentage Diving a trial gain We last accounts. Late the points offers pre-promotional tested into by during period.

is indicator metric and expansion. we inspecting smoker to also of in that other are devices, evaluate longer-term we and of measure believe an potential the leading adoption trial a its as One of stages of category believe early of We better share and important in it's the a variety e-vapor indicator NJOY metrics adoption. such retail vapor of a trial is of trial

convenience multi-outlet points XX.X the since share of first quarter devices of quarter the the of third X.X points, channel share was in an sequentially share XXXX, quarter, first share NJOY's points our X.X In ownership. and full and increase of

shipment Turning to volume and was shipments, approximately approximately shipment NJOY million XX.X consumables was volume device NJOY's units, million X units.

While we volume retail pipeline increased shipment quarter recall the anticipated was shipment wholesale included the in flat sequentially, and fourth essentially that quarter. demand support building at first volume to NJOY XXXX inventory

experience, and vaping broaden attributes brand which consumer retail, U.S. unique to tobacco exceptional at through millions age-verified NJOY adult affinity new and Moving summer; adult-only various improved new through emphasizes the activate NJOY awareness forward, a equity our infrastructure, positioning enjoys event NJOY's grow plan consumers to a that aims of this database, us which to allows of the channels. tobacco adult expects marketing to marketing and our campaign communicate

the PMTA continue submit for with the of will also We expect NJOY to second age-gated encouraging is early NJOY's ACE by quarter. filings that success end flavored Bluetooth technology NJOY products the the the broader of in marketplace, disposal and the threaten harm-reduction proliferation illicit of the products in opportunity States. lack context United FDA-authorized in where products e-vapor a of trends continued

lawmakers, relates believe other build to to awareness enforcement. marketplace approach is trade comprehensive to a we address enforcement, this and actively partners continue with issue, and state and we needed regulators, drive As that engage our to stakeholders federal and it

quarter. we but encouraging significant in saw actions ahead, the first There work is still some

quarter retailers to U.S. the The last warning XXX agency of of over illicit monetary In from related alone, refusals, all import continued wholesalers first in e-vapor Customs also collaboration XXX and FDA, to civil products. Border and manufacturers, and year. send during up letters issued the the levy Protection, penalties with

threat of are bring represent FDA's in progress, actions the they public health, about we inadequate. and not to of the scope change believe scale Illicit a wholly to we marketplace. approach fundamental signs believe markets enforcement is these or are needed While the

to address identified distributors the and direct the products, FDA's take enforcement of the program manufacturers, specific enforcement clear we to import illicit priorities. steps imposing prevention marketplace widespread agency enough on result, large focusing build they confusion in market, compliant a we illicit effective including about As more importers to and on believe the and a the liability can

to Earlier this solutions reinforcing e-vapor on a we our can recommendations collaboratively the in month, marketplace. commitment FDA, and restore highlighting the sent to that order these work letter

state have to We with are passed with work legislatures considering or FDA manufacturers they also compliant that that are continue legislation certify requirements. requiring to

against states And the As of X are it. ], April illicit that legal [ are enabling market. entities XX considering and XX seen legislation passed states have action we've increased such

voluntarily litigation earlier this relating products. challenges, unlawful As we've this year. initiated California in previously the the disclosed, Due dismissed sale litigation States to of some Court procedural we in we District United to

in of new for retailers We And month, in X sale a of against manufacturers, Elf products their February and of lawsuit Bar retailers subsequently X City the brick-and-mortar New Federal this XX the filed filed e-vapor part Court X in illicit products. York wholesalers illegal a against earlier California. online disposable lawsuit e-vapor

a We protect U.S. smokers correction tobacco continue needed in the opportunity the harm to the to category, promise for millions reduction believe strong of the in course e-vapor adult responsible is but a of

impactful the issues we some We've stakeholders. signs learned action, see progress like experience more to needs starting And are made. work this many of early be from to that while of require past complex

] XX.X of the the of ] [ [ industry tobacco X.X% nicotine oral over year-over-year oral the tobacco category. contributor grew [ X months. to increase turn oral the category. the now volume pouches nicotine pouches Oral XX% primary Oral in ] points share over and Let's were tobacco estimated represent past now

share increase million an during of XX%. share to Helix on! its approximately the the first of continued category grew to points quarter, growing [ tobacco XX [ its volume by cans X.X%. ] momentum oral at reported ], shipment on! X.X retail

introduced trade on! spring, that over broader premium program impressive Helix XX%. as new positioning in these increased results by of a retail XX% delivered visibility stores, of price for brand. on! the contracted secures creating This Helix

strategically to expect the on contribute accelerates. year. Helix category we for is which submit as making half following to growth. in is for the PMTA authorization, first brand the meaningfully of Helix on! continuing FDA we growth investing PLUS, will Helix' believe preparations it Upon behind its final also its this focus

to confident ability shareholders. and to with reduction aggressively dedicated tobacco the portfolio employees. in conditions to smoke-free Altria's the reductions way exciting U.S., create to continue am harm lead the We our our for benefit products talented and success society of consumers, in pursue and I in efforts harm tobacco our

representing progress deliver smoke-free and in mind, in our the a our strength full XXXX, rate EPS X.X% $X.XX, from base growth X% traditional in With $X.XX of to diluted a tobacco businesses of guidance to of XXXX. of reaffirm $X.XX adjusted our the range to year we

the I'll details to business to now Sal it turn environment more provide on and our results. over

Thank, Billy.

X.X%. earnings share diluted per by adjusted quarter First declined

the second two of we noted, diluted XXXX EPS will year, growth be to previously resulting we main adjusted expect As weighted the that factors. from half

the last year, not the this NJOY we the the to of brand. acquisition of that XXXX. we lapping impact year quarters the transaction relates first investments in half The of amortization are do of Since in the behind include X or on first timing June closed

of segment, the each the occur factor days smokable second in year. impact of is the the The shipping additional X which second in of half

ago. billion The Turning leadership delivered the X.X%. down segment over category. were from And realization net OCI robust long-standing smokeable operating a business company's quarter for quarter, margins products Marlboro our in in now price first year with maintained $X.X slightly income, cigarette its results. Adjusted to of XX.X% the adjusted

were higher the remainder pack the lower and manufacturing Year-over-year per for margin were than unit charges costs. year. higher the cost quarter. costs impacted were by partially Year-over-year higher some increases first These quarter elevated costs offset comparisons MSA settlement by expect we per SG&A the and in of manufacturing in

SG&A year to this expect also segment the We lower progresses. as costs from benefit

in estimate same volumes impacted by We movement trends continued the When disposable volume proliferation illicit negatively Total factors, X% and over industry have quarter. of been adjusted other consumer period. discretionary trade believe and that that inventory segment the by the pressures smokeable on income. reported and tobacco products by industry declined we XX% cigarette first adjusted volumes e-vapor for products declined

driven the share macroeconomic X.X the adult pressures results the points smokers. first in quarter. on At part discount by grew retail, these segment believe We were in

see competitive to priced in continue multiple the branded We including discount offerings discount activity segment, increased deep levels. discount at

increase Meanwhile, the of in Marlboro environment. to share XX.X%, position and segment. to share grew retaining X.X aspirational loyalty is of We continued share as segment resilience, in Marlboro in consumer its category believe a premium an profitable driving the challenging retail its Marlboro's premium XX% highly the outperformance points. of strong brand continues also the its its show

the reported In large to & cigars, X.X% Mild the segment. results, Black to cigar decreased by and machine-made in in segment continued remains financial cigar Middleton contribute smokable the highly first quarter. leader shipment volume products profitable

points percentage tobacco on! the and X.X that offset quarter movements, in more X.X% segment reported grew segment, adjusted trade decreased to oral [ adjusted Total first When OCI lower volumes adjusted segment Moving we XX.X%. OCI volume growth tobacco differences was than the quarter to first as by products expanded margins by shipment in inventory X%. X.X% estimate declined approximately ] products for calendar oral and volumes. by MST

points declined in brands, retail remain growth by leading and by tobacco smokeless share, segment share were products X.X tobacco Oral to remain moist brand. Copenhagen encouraged MST products percentage continued tobacco offset on!. We partially the the as oral performance as the on! grow declines of our our of

March, capital received we to are to share repurchase expanded implemented representing our of billion our program, for These accelerated In which a we our share a investment shares under XX.X sold portion and XX% allocation. weighted outstanding in our average of in In Program. million repurchases the billion. quarter. $X.X ABI the repurchase reflected expanding we shares in Moving ASR $X.X program repurchase program, March,

the authorized program, the repurchase billion XX% representing the by Program by the ASR year-end. the to which expect completion currently We under shares ASR quarter. expect Program, anticipate remaining to remaining having of we complete second of the we of the end receive After $X share

for to ABI's equity Turning of the ]. results. down million $XXX financial quarter, X.X% recorded adjusted We earnings [

ABI equity ABI's accounting in and a our our quarter using method a of for we As share investment use reminder, of X report results lag. the

of share our represent earnings fourth quarter equity earnings. adjusted ABI's quarter first our Accordingly,

transaction, ABI a approximately billion. with ownership the tax of basis ABI $X.X Following X.X%, our of is approximately

We the continue financial a view to our ABI for goal investment, of and our remains the shareholders. to long-term value as investment stake maximize

notes activity. to billion X.Xx. quarter. $X.X as retired And capital and in of other debt-to-EBITDA first due approximately Turning XX, our came ratio March allocation $X.X of paid dividends in the billion was that We

and I to Billy With that, we'll up, wrap and be take happy will questions. your

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

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

Instructions] go from Please Our come first will ahead. with [Operator Kaufman Stanley. question Pamela Morgan

despite of ABI is raise the into of underlying your to considerations I share What ask the beginning incremental full-year to repurchase that? your weaker-than-expected guidance X% following went of plans about a to the an stock. the performance sale relative to your of reflection outlook wanted modest And it at year? your

really Thanks point. were the half revise up the for X.X the to happy point. percentage our We guidance We our the of took core end guidance read in take of able into the a confidence about top top full bottom by the to question. percentage be and that -- end up would I businesses. the guidance

products. our go business, with it flexibility but we as overall behind manage innovative investments tobacco year us But also, the make not provides throughout to only to our

reflects able transaction. of good we about the It So really accretion guidance. to provide ABI the the feel being

increasingly second second ] volume a to profit by is question the is given declines. operating your more And strategy my cigarette in been excess Okay. [ And to taking bit alternatives, is because And the has this reinvest profitability? backdrop? other Historically, considered sustainable to operating you maximize -- of philosophical. price becoming the behind volume have this declines need the you that approaches in magnitude do think strategy difficult maximizing and of changing of

right the Pamela, is look always we it like long the in investments profitability would segment. We little term our growth maximize over than appropriate It's strategy. to Marlboro and the bit but you that Yes. differently making did. strategies, at while I phrase a feel

from I impact you think rates. of about we've loads into when go pricing that, factors talked decisions, the about interest for consumer think strain, highlighted is under inflation certainly, about think both that you well we've as the and and our high when pricing, So that the cumulative as you economic debt

maximize price the term. profitability And to the feel the good it realization long We ]. had to we continue so was X.X% we're going about in quarter, over [

think it's consumer about step to retail. and felt back important think I what at the

And so think about X%. shy that, you of when was that just

consumer and there's So our But and we're is there. be still appropriate them. for under there make to competition out investments pressure, going

I look proven strong strategy. back be think through that's a to you if history,

from Herzog Bonnie Goldman next come Our will question with Sachs.

question Maybe a to bit follow-up Pamela. of a

bit, Just certainly I think one smokable in pack up I controllable per your thing quite cost was quarter saw in the up mid-teens. a were

about on think how for And touch could expectations of just dollar you growth drivers ultimately, that, back forward? honestly, in hoping So in and profit improved your should the then we the that moving smokable half.

end understand, flexibility trying year, I you to guess can you your of this Again, bit guys I'm Pamela profits high hit how trying was little much but to a to what of dollar of guidance mid- kind asking, just have. recover? if EPS the don't understand

follow all bit. Bonnie, Hopefully, If I'm that a going unpack little on it. to touch don't, I aspects I please question of up.

to really the first As quarter, of I will we about point we think quarter the It's year. opening would comparisons rest out. impact the in level then first talked remarks, at think there's higher I year prior that impact a of items couple about our a that

related if to A past, couple within accrual accounting the you complex is you MSA. We've MSA the adjustments think pack. you've adjustments past. cost And things in about. adjustments There's as a of the seen per of the inflation. when adjustments, in develop lot you for variables. will, like It's calculation a seen One

really to quarter, did adjustment. an This was we specific make It profits. industry

of lower Specifically, than had major our one profits anticipated. competitors

in ] cost to deep for the do get methodology. [ the but into then account side, And on the too LIFO accounting, we not inventory

the it it in a will first higher P&L does the you P&L, of the when quarter the year. in than So inventory, it revalue level the remainder impacts at impact and the

broader To premium our of segment the the margins the continue performance question, stable performance very you really to And to where feel in segment. of happy we're products confident your grow category. in the ability we that growth the of share Marlboro, performance cigarette within smokable saw and segment, with

that's guess mentioned. helpful. a hearing like correctly, I'm really it's you maybe the I of guess you I one-off And if Okay. more that But timing

and those controllable dollar moving part growth? in help the the if So just the that going as to to forward profit moderate, cost, think half, of back drive that's confidence you have? the about honestly, we especially Is

Yes. did finally, And throughout first point the in The segment year-over-year me smokeable benefit it quarter. year. from out, from then was that will also SG&A benefit increase continue to higher products costs let the the lower that -- and

about good forward. So going segment, we smokable the feel again, very products

maybe then or question helps. my on No, next final question that And pricing. is

talking You and increases so year, [ far guys pricing. about have this am taken ] cig I X

sounds your be reasonable, but peers strength. ] or typical pressure to cadence, the don't [ quarterly frequency on follow your of that given following cig to which terms volumes, seems seem So unrelenting in

And of to how And gaps, and I especially that asking guess I'm I'm you to the concerned continuing seems are we're the pressures be price much about they've how asking widened? which seeing, accelerate. because light in down-trading

as the that illicit think kind cetera, proliferation manage down-trading? about et ability and should of gaps, e-cigs. of we How guys your continued price called And you out, to and these

of it smokeless tobacco the over be growth in the standpoint step a data appreciate being pricing not what management, how started talk I I you time, question, from analytics, But Yes, made see investments revenue benefit really performed to back you careful cigarettes. traditional think able I'd at of it's you to about when I and we look Bonnie. in where the over to is and think we decisions. future brought bring moist

about see of of growing brand. we in Marlboro, little Yes, it is and consumer think shows think strength feel Marlboro economic of tools the you history, under a the have back you good down you I But that the within that is see I performance You trading. see the when steady if occur that and share We pressure. bit premium. of overall through share look

you From price from e-vapor. illicit decline macroeconomic on holding a for try in you standpoint the point, and the a of to the we really of And elasticity it's proliferation provide decomposition. secular the pressures volume, to see your steady,

regulatory standpoint, need consumer illicit we enforcement at is so from overall really the against looking a environment smoke-free demanding And products. and is that authorizing an effective to see products and e-vapor is that both

with next question from Baig comes UBS. Our Faham

X% me, to of for other some decline A still I end bottom the the division. you outlook? of just further questions and volume rest you both minus remains from higher? costs on want allows your of SG&A the EPS have reduce the the hit couple to at whether understand year, if that still pricing words, smokables industry raise room to In

question on And second growth can is please? cigarette had whether the of in what of estimate you might this category and QX, in the have vapor QX, share your volumes impact the

Yes. your I appreciate question.

from the look, we standpoint outcomes guidance, range of what very a guidance think of through could year. we good the have about reaffirmed the a I run out as marketplace. of We the progress that in guidance feel and that be scenarios we

you the illicit from of think vast grow, that e-vapor, that believe e-vapor the e-vapor coming continues about majority I disposable overall we category think to the with when products.

While being there, the normal goes filling as distribution information our the it of it we illicit started chain. of gaps, some around nature

in and to, fully consumers those a thing converted saw our cigarettes can think step-up growth and now just e-vapor. engaged are XX that the that the million shy of point both included a [ I those metrics, moving best quarterly XX-month still I and are and on the of ] with you using engaged you consumers this we

X.X nature those wide fill try but a good range. read going X.X. then it's category we'll feel to gaps of We to range, it to provide updates in impact looking about to as we're estimate fill illicit. I appropriate. and the the the illicit gaps continue being e-vapor of that the a again, cigarette those that decomposition, the bit as information get those And is information And for to a range on marketplace, we of know

Smith Our Stifel. comes from Matt with next question

Can are quarter consumer? And in the pricing talk you you of lapping economic with on the in the behind reacceleration the about a factors now brand combustible fourth was on above pack, that's the the response stronger in the price in There to realization X.X%, pressure quarter. some up the the Marlboro price per in investments response the -- to X.X% in stepped-up pressure realization? business the

Yes.

longer from standpoint, look think to I a you encourage at term. would realization I price the over

well we it's as referred I as to you we're highlighted through the on of pockets. some pressure seeing, there in menthol we exactly XXXX, think investments wanted make, the of segment We to. are what as both discount some progressed Marlboro

important we're the that on it's price think price show to down level. gap managing at I national that store a we remember basis, gap that

see So side one you different the can city to go other gaps stores. in price the from and of

Marlboro able to experienced to it strength with I And quarter. we so point, the price realization the you being mine think in and data, strong that your see of the

shifting we impact And in in my the think R&D costs through XXXX? The the question, second the is that to Should addition R&D meaningful from given phasing shift, EPS did shift to weighted the to profitability unique higher all growth smokable growth smokeable? weighted overall spending half to the second the Can about other talk quarter, first in you segments. half? company that the seem the that of second of

at products, segment in in are towards and correct the a you -- don't but Matt, seeing innovative the know, don't those shift that you part the costs we that's level, lower within talked guide R&D we as spending are will Bonnie. the to with benefit continue smokable SG&A segment progresses. from segment about SG&A year as of I earlier smokeable benefit the The you

question Gaurav will Jain with Barclays. come from next our And

me. Two questions from

So one pricing. is on retail

saying in XXX is QX, you And [ was [ think ]. QX, in it ]. I it XXX are

the have share nicotine in oral that pouches? stem So seen on! have promotions loss you up on stepped to you

to Gaurav, in segment. the that data stepped both to see smokeless mentioned say standpoint. from the bring over Really, see investments from and that the able a you what have, that any happening, nicotine tobacco pouch -- we you smokeable share up segment for purposes the wouldn't moist analytics, I advanced we I being

going promotions you're time. have to pulse through so And

is still space. to the in there choices those converted with goal both trial, keep but are the different consumer real that induce brand, from competitive engaged and making The the nicotine

on And the growth going term, back we retail volume with so that price to basis. variability step long short-term a I think it's important and significant over experienced But see see the to year-over-year. you're

question ABI's on stake. Sure. is second And my

that tax remaining stake a highlighting has you're $X.X basis. billion the So

So of your just ] XXXX. expire sort X tranche, losses JUUL [ March in

So a be expecting from years? the the fair rest next stake would we progressive in the exit X of over

your don't, to I question, sure want follow I'm please make Gaurav, if answering I up.

You shares. just are our right that related we provided allocation basis. consider executed what $XXX shares was both than mix liability transaction we variables we were the with a is investment less you we that you analysis. with earlier restricted year, And unrestricted the million. this that to of new tax ABI many is capital shared sold of tax and the the we the one and And that The tax

JUUL losses is that sorry, I'm losses. [ related the expectation ABI that Our we future to in -- ] can offset

JUUL losses, remind you we tax [ The just other reserve about tax that over call ] cash for you that I'll took it, -- is for about if on as the P&L. fully ordinary losses half; just let's we thing think the purposes, but half,

the to the get continue hear feedback hope IRS. year to We progresses. to wait more from We as

Please next Callum Our Elliott question ahead. from Bernstein. go with comes

the sounds and us impressive are But NJOY, On kind different show nice the from called in improvement. share a data which candidate slightly of and past that do also XX for me. retail see sales it double the questions gain, few we of months. basis of down digits points this Couple brand the for this can you

from in market of decline the I is, else guess my share going sort something the that's Or that despite there gain? products ongoing impacting cause is So in products to this legal deterioration, question this the illicit is heavy pressure the just category? on

Yes.

that what marketplace. is the segment specifically you grow, in while shrink to to you think pod the Callum, in vapes the continue pod, the exactly disposable, what is that's out, illicit marketplace, replaceable continue see capsules, are overall the pointed I

on question oral second Okay. And tobacco. then is my

You touched think, a with, upon bit just little I but on Faham's this earlier question, that. building

got some release, on declining now the on on basis PMI, numbers I've total from and an your of slightly. XX% based oral XX% is XX% I think your based numbers in growing and share, volumes share apples-to-apples year-on-year. Zyn at

seems, are to position be guys a on leadership whole. cusp losing tobacco you So the in now that your it clear, all as of

So change be your leadership about Can I my losing maybe question this position how to mindset free going you're come sense does a guess you in is, in category? the to from slightly mindset come you've through the years to the at past maybe had this challenger from Zyn? of pressure relative sort defensive this necessarily a that mindset several slightly over more

Yes.

about aspiration Brian think oral Copenhagen, there you behind when overall profitability investments think really I making and the ] category, balancing MST tobacco in which while appropriate the to investments the maximize strategy is [ is of on!. in

saw quarter, price. volume, in share overall in increase retail space, growth of and pleased the with significant tobacco growth we to first the certainly the on! in oil the continues Copenhagen in [ in we ] be and the space leader results MST are in the the the

well application will the authorized. in And with feel the on! then behind the that, being able to very the perform once PLUS, like which marketplace we FDA file for

next [Operator Wall Maloney comes Instructions] with Journal. Street from question Our Jennifer

First, I wanted to under ask about pressure. consumers

to? be call were you that? said You by that investments them. do referring you going this make to are you of there you tell What on kind appropriate mean and investments Could what for

can the it's really, store it's town. different analytics price marketplace. that or they're I in gap a appropriately economic consumer When that across and really highlighted resources data we and those be that facing. situation city the pressure being store in promotions think Yes, a than seeing Jennifer, the earlier, the about a mining dial And for the data able around received, and you to

in so us there really that marketplace through continue time. to for consumer. the And the it's to It retail promotions adjust be about allows we

having place with engage having Marlboro, gauge, Black, Another can pressure. the they place a would for a they're to that under wants that be to example Marlboro when consumer academic continue even

promotional and lower-priced Marlboro the of when some you your to also both activity, would brands? that And brand apply say

the it us the of be small the brand, as It pool. take but to think And When a you with them of Marlboro one the Marlboro and for entire engage continue Black we look portfolio, mentioned a we there portfolio. across family, gives look portfolio consumer. place like to just I Marlboro and allows the across big RGM the segment to

at XXXX, to or do the you moderate? continue on rest expect consumers of to lower-income out pressures Looking

Yes.

the about I at socioeconomic status, think when you been think impacted. of end being the lower the they've consumer

as increase and as the that spend bit, has through slowed inflation the coupled impacted time consumers. in our for impact rates inflation debt has increasing of interest it's that, down While cumulative And a on discretionary well levels. market still increased total purchase, it's with their

One more oral question tobacco. modern on

So Skoal share Copenhagen Zyn. Zyn tobacco seems and losses is taking in it on!, share like from share at and traditional to performance on! and the up looking catching isn't in oral the significant also

your then and So what's the modern strategy that specifically tobacco category for oral overall for subcategory? oral

Yes.

strategy the oral -- You may have tobacco and investments our appropriate is the product the in overall profitability heard the in mention in on! maximize me marketplace. the earlier, making while term investments in to long in over Copenhagen

them enjoying moving social products move smokeless their that think think in nicotine that about consumer you in when of avoid nature, to things the to [ to their I product. to relation And first from allows it, intuitive MST They're the some used nicotine is in mouth. ] putting pouch over. nicotine spitting moist the it's of friction, to

on!, feel versus we very good. about When you the think Zyn

PLUS remarks, we we the positioning which good going feel pipeline we're end you the about we'll in at -- PMTAs following feel through on! better retail. with in have about feel think as to our and the quarter. FDA, progress follow, this We product, like and the we existing we great of be I that saw to highlighted

to your losing Skoal would rather that of oral from say on! those to be goal fair So it modern than who to would those are them folks possible as capture as be Copenhagen many Zyn? capture folks moving with to to and

That would be correct.

questions to no appears call at further time. for Mac closing the to like remarks. there Livingston And to would turn this any back be I

you today. call the joining all day. much. for a Thanks Thanks great Hope so have

disconnect may any at your call. for today's participation, concludes And you time. this you and Thank