RICHMOND, Va. (AP) — Altria’s fourth-quarter revenue improved thanks partly to higher tobacco product pricing, and the company announced a plan to reduce costs that includes job eliminations.
The owner of Philip Morris USA, the nation’s largest cigarette maker, said Thursday that its productivity plan will trim spending on certain selling, general and administrative infrastructure and create a leaner company.
It expects about $300 million in annual savings by 2017’s end. Restructuring charges are anticipated to be approximately $140 million, or 5 cents per share, with most of the charges expected to be recorded in 2016’s first quarter. Altria said the charges include about $120 million in employee separation costs.
Altria earned $1.25 billion, or 64 cents per share, for the period ended Dec. 31. A year earlier the company earned $1.24 billion, or 63 cents per share.
Stripping out certain items, earnings were 67 cents per share.
The results missed Wall Street expectations. The average estimate of four analysts surveyed by Zacks Investment Research was for earnings of 68 cents per share.
Revenue, excluding excise taxes, increased to $4.79 billion from $4.61 billion.
Cigarette shipment volume fell 2.6 percent, while cigar shipment volume climbed 6 percent.
For the year, Altria Group Inc. reported an adjusted profit of $2.80 per share. Revenue, excluding excise taxes, totaled $18.85 billion.
Going forward, the company anticipates a 2016 adjusted profit in a range of $3 to $3.05 per share. Analysts polled by FactSet expect $3.05 per share.
Elements of this story were generated by Automated Insights using data from Zacks Investment Research.