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Altria Reports 2022 Fourth-Quarter and Full-Year Results; Provides 2023 Full-Year Earnings Guidance; Announces New $1 Billion Share Repurchase Program
RICHMOND, Va., February 01, 2023--(BUSINESS WIRE)--Altria Group, Inc. (NYSE: MO) today reports our 2022 fourth-quarter and full-year business results and provides our guidance for 2023 full-year adjusted diluted earnings per share (EPS).
"It was an exciting year for Altria as our businesses delivered strong financial performance, and we continued to strategically invest toward our Vision," said Billy Gifford, Altria’s Chief Executive Officer. "We generated strong adjusted diluted EPS growth of 5% and made meaningful progress in several areas of our smoke-free portfolio."
"Our plans for 2023 include a continuation of our strategy to balance earnings growth and shareholder returns with strategic investments toward our Vision. We expect to deliver 2023 full-year adjusted diluted EPS in a range of $4.98 to $5.13, representing a growth rate of 3% to 6% from a base of $4.84 in 2022."
Altria Headline Financials1
($ in millions, except per share data) | Q4 2022 | Change vs. | Full Year 2022 | Change vs. | |
Net revenues | $6,111 | (2.3)% | $25,096 | (3.5)% | |
Revenues net of excise taxes | $5,083 | (0.1)% | $20,688 | (2.0)% | |
Reported tax rate | 0.5% | (28.3) pp | 22.0% | (13.3) pp | |
Adjusted tax rate | 25.0% | (0.5) pp | 24.9% | (0.2) pp | |
Reported diluted EPS2 | $1.50 | 70.5% | $3.19 | 100%+ | |
Adjusted diluted EPS2 | $1.18 | 8.3% | $4.84 | 5.0% | |
1 "Adjusted" financial measures presented in this release exclude the impact of special items. See "Basis of Presentation" for more information.
2 "EPS" represents diluted earnings (losses) per share attributable to Altria.
As previously announced, a conference call with the investment community and news media will be webcast on February 1, 2023 at 9:00 a.m. Eastern Time. Access to the webcast is available at www.altria.com/webcasts.
Cash Returns to Shareholders and Capital Markets Activity
Share Repurchase Program
We completed our previously authorized $3.5 billion share repurchase program. In the fourth quarter, we repurchased 8.3 million shares at an average price of $45.09, for a total cost of $374 million. For the full year, we repurchased 38.1 million shares at an average price of $47.83, for a total cost of $1.8 billion.
Our Board of Directors (Board) authorized a new $1 billion share repurchase program, which we expect to complete by December 31, 2023. Share repurchases depend on marketplace conditions and other factors, and the program remains subject to the discretion of our Board.
Dividends
We paid dividends of $1.7 billion in the fourth quarter and $6.6 billion for the full year.
We maintain our long-term objective of a dividend payout ratio target of approximately 80% of our adjusted diluted EPS. Future dividend payments remain subject to the discretion of our Board.
Capital Markets Activity
We expect to retire approximately $1.3 billion of notes coming due later this month with available cash.
Macroeconomic and Geopolitical Conditions Impacting Our Businesses
Impact on Tobacco Business Operations
In 2022, our businesses were not materially impacted by increased costs resulting from global supply chain challenges and high inflation.
Impact on Adult Tobacco Consumers (ATCs)
In 2022, we believe high rates of inflation impacted ATC behaviors, discretionary income and spending. As a result, our businesses and the industry experienced elevated volume declines, and we observed accelerated share growth in discount cigarettes. Despite these factors, our leading tobacco brands remained resilient and we continued to observe significant brand loyalty in the tobacco space overall.
Philip Morris Capital Corporation Update
As of December 31, 2022, we completed the wind-down of Philip Morris Capital Corporation (PMCC) and no finance assets remain.
Environmental, Social and Governance (ESG)
Our Corporate Responsibility Focus Areas are: (i) reduce the harm of tobacco products, (ii) prevent underage use, (iii) protect the environment, (iv) drive responsibility through our value chain, (v) support our people and communities and (vi) engage and lead responsibly. Our corporate responsibility reports are available on the Corporate Responsibility section of www.altria.com.
Our responsibility efforts and recognitions from 2022 include the following:
We recently announced that we will conduct an equity and civil rights assessment (Assessment). The Assessment follows last year’s passage of a shareholder proposal recommending Altria commission a civil rights equity audit and seeks to address feedback received from recent robust shareholder engagement. We believe the Assessment will identify opportunities to accelerate progress toward our 2025 Corporate Responsibility focus area goals, enhance stakeholder alignment and promote transparency.
Continued to support efforts to reduce youth tobacco use. Today, underage use of conventional tobacco products is at the lowest levels in a generation. The 2022 Monitoring the Future (MTF) study estimates youth smoking rates to be 2.1%, a nearly 93% reduction from its 1997 peak of 28.3%. Prevalence of past 30-day nicotine vaping among youth is 13.8% in 2022 versus its 2019 peak of 18.1%. MTF surveys 8th, 10th and 12th graders. Rates reported are for 8th, 10th and 12th graders combined.
Continued to demonstrate environmental leadership with recognition from CDP Global, a non-profit that runs a global disclosure system on managing environmental impact, for addressing climate change (A-) and protecting water security (A-), and improved our rating for addressing the drivers of deforestation (B).
For the fourth consecutive year, we were chosen as one of the "Best-of-the-Best" Corporations for Inclusion by the National Business Inclusion Consortium. The Best-of-the-Best designation honors corporations for their commitment to America’s diverse employees and business owners.
2023 Full-Year Guidance
We expect our 2023 full-year adjusted diluted EPS to be in a range of $4.98 to $5.13, representing a growth rate of 3% to 6% from an adjusted diluted EPS base of $4.84 in 2022. While the 2023 full-year adjusted diluted EPS guidance accounts for a range of scenarios, the external environment remains dynamic. We will continue to monitor conditions related to (i) the economy, including the impact of high inflation, rising interest rates and global supply chain disruptions, (ii) ATC dynamics, including disposable income, purchasing patterns and adoption of smoke-free products, and (iii) regulatory and legislative developments.
Our 2023 full-year adjusted diluted EPS guidance range includes planned investments in support of our Vision, such as (i) continued smoke-free product research, development and regulatory preparation expenses, (ii) enhancement of our digital consumer engagement system and (iii) marketplace activities in support of our smoke-free products. The guidance range also includes lower expected net periodic benefit income due to market factors, including higher interest rates, and the impact of the 2022 completion of the PMCC wind-down.
We expect our 2023 full-year adjusted effective tax rate will be in a range of 24.5% to 25.5%. We also expect our 2023 capital expenditures to be between $175 million and $225 million and 2023 depreciation and amortization expenses of approximately $230 million.
Our full-year adjusted diluted EPS guidance range and full-year forecast for our adjusted effective tax rate exclude the impact of certain income and expense items that management believes are not part of underlying operations. These items may include, for example, loss on early extinguishment of debt, restructuring charges, asset impairment charges, acquisition-related and disposition-related costs, equity investment-related special items (including any changes in fair value of our equity investment recorded at fair value and any changes in the fair value of related warrants and preemptive rights), certain income tax items, charges associated with tobacco and health and certain other litigation items, and resolutions of certain non-participating manufacturer (NPM) adjustment disputes under the MSA (such dispute resolutions are referred to as NPM Adjustment Items). See Table 1 below for the income and expense items for the full-year 2022.
Our management cannot estimate on a forward-looking basis the impact of certain income and expense items, including those items noted in the preceding paragraph, on our reported diluted EPS or our reported effective tax rate because these items, which could be significant, may be unusual or infrequent, are difficult to predict and may be highly variable. As a result, we do not provide a corresponding U.S. generally accepted accounting principles (GAAP) measure for, or reconciliation to, our adjusted diluted EPS guidance or our adjusted effective tax rate forecast.
ALTRIA GROUP, INC.
See "Basis of Presentation" below for an explanation of financial measures and reporting segments discussed in this release.
Financial Performance
Fourth Quarter
Net revenues decreased 2.3% to $6.1 billion, primarily driven by lower net revenues in the smokeable products segment. Revenues net of excise taxes were essentially unchanged at $5.1 billion.
Reported diluted EPS increased 70.5% to $1.50, primarily driven by favorable income tax items, 2021 Cronos-related special items, higher reported operating companies income (OCI), 2021 ABI-related special items, fewer shares outstanding and favorable interest expense, partially offset by 2022 changes in the estimated fair value of our investment in JUUL (including the corresponding adjustment for a tax valuation allowance).
Adjusted diluted EPS increased 8.3% to $1.18, primarily driven by higher adjusted OCI, fewer shares outstanding and favorable interest expense.
Full Year
Net revenues decreased 3.5% to $25.1 billion, primarily driven by the sale of our former Ste. Michelle wine business in October 2021 and lower net revenues in the smokeable products segment. Revenues net of excise taxes decreased 2.0% to $20.7 billion.
Reported diluted EPS increased 100%+ to $3.19 primarily driven by lower reported losses from our investment in ABI (due primarily to a lower impairment of our investment in ABI), favorable income tax items, 2021 losses on early extinguishment of debt, lower losses from Cronos-related special items, higher reported OCI, fewer shares outstanding and favorable interest expense, partially offset by 2022 changes in the estimated fair value of our investment in JUUL (including the corresponding adjustment for a tax valuation allowance).
Adjusted diluted EPS increased 5.0% to $4.84, primarily driven by fewer shares outstanding, higher adjusted OCI and favorable interest expense.
Table 1 - Altria’s Adjusted Results | |||||||||||||||||
Fourth Quarter | Full Year | ||||||||||||||||
2022 | 2021 | Change | 2022 | 2021 | Change | ||||||||||||
Reported diluted EPS | $ | 1.50 | $ | 0.88 | 70.5 | % | $ | 3.19 | $ | 1.34 | 100 | %+ | |||||
NPM Adjustment Items | — | — | (0.03 | ) | (0.03 | ) | |||||||||||
Asset impairment, exit, implementation, acquisition and disposition-related costs | — | — | — | 0.05 | |||||||||||||
Tobacco and health and certain other litigation items | 0.01 | 0.02 | 0.05 | 0.07 | |||||||||||||
JUUL changes in fair value | 0.06 | — | 0.81 | — | |||||||||||||
ABI-related special items | — | 0.04 | 1.12 | 2.66 | |||||||||||||
Cronos-related special items | — | 0.15 | 0.10 | 0.25 | |||||||||||||
Loss on early extinguishment of debt | — | — | — | 0.27 | |||||||||||||
Income tax items | (0.39 | ) | — | (0.40 | ) | — | |||||||||||
Adjusted diluted EPS | $ | 1.18 | $ | 1.09 | 8.3 | % | $ | 4.84 | $ | 4.61 | 5.0 | % | |||||
Note: For details of pre-tax, tax and after-tax amounts, see Schedules 7 and 9.
Special Items
The EPS impact of the following special items is shown in Table 1 and Schedules 6, 7, 8 and 9.
NPM Adjustment Items
For the full-year 2022, we recorded pre-tax income of $68 million (or $0.03 per share) for NPM Adjustment Items and related interest, including $63 million recorded as a reduction to cost of sales in the smokeable products segment and $5 million recorded as interest income.
For the full-year 2021, we recorded pre-tax income of $76 million (or $0.03 per share) for NPM Adjustment Items and related interest, including $53 million recorded as a reduction to cost of sales in the smokeable products segment and $23 million recorded as interest income.
Asset Impairment, Exit, Implementation, Acquisition and Disposition-Related Costs
For the full-year 2021, we recorded pre-tax charges of $120 million (or $0.05 per share), due primarily to charges associated with the sale of our former Ste. Michelle wine business and acquisition-related costs for the settlement of an arbitration related to the 2019 on! transaction.
Tobacco and Health and Certain Other Litigation Items
In the fourth quarter and for full-year 2022, we recorded pre-tax charges of $30 million (or $0.01 per share) and $131 million (or $0.05 per share), respectively, for tobacco and health and certain other litigation items and related interest costs.
In the fourth quarter and for full-year 2021, we recorded pre-tax charges of $34 million (or $0.02 per share) and $182 million (or $0.07 per share), respectively, for tobacco and health and certain other litigation items and related interest costs.
JUUL Changes in Fair Value
We recorded non-cash, pre-tax unrealized (income) losses from investments in equity securities as a result of changes in the estimated fair value of our investment in JUUL consisting of the following:
Fourth Quarter | Full Year | ||||||||||||
($ in millions, except per share data) | 2022 | 2021 | 2022 | 2021 | |||||||||
(Income) losses from investments in equity securities | $ | 100 | $ | — | $ | 1,455 | $ | — | |||||
Losses per share | $ | 0.06 | $ | — | $ | 0.81 | $ | — | |||||
We recorded corresponding adjustments to the JUUL tax valuation allowance in 2022. As of December 31, 2022, the estimated fair value of our investment in JUUL was $250 million.
ABI-Related Special Items
In the fourth quarter of 2021, equity earnings from ABI included net pre-tax charges of $92 million (or $0.04 per share), substantially all of which related to ABI’s mark-to-market losses on certain ABI financial instruments associated with share commitments.
For the full-year 2022 and 2021, equity earnings from ABI included net pre-tax losses of $2.5 billion (or $1.12 per share) and $6.2 billion (or $2.66 per share), respectively, substantially all of which related to impairments of our investment in ABI.
The ABI-related special items above include our respective share of the amounts recorded by ABI and additional adjustments related to (i) conversion from international financial reporting standards to GAAP and (ii) adjustments to our investment required under the equity method of accounting.
Cronos-Related Special Items
We recorded net pre-tax expense consisting of the following:
Fourth Quarter | Full Year | ||||||||||||
($ in millions, except per share data) | 2022 | 2021 | 2022 | 2021 | |||||||||
Loss on Cronos-related financial instruments 1 | $ | 1 | $ | 20 | $ | 15 | $ | 148 | |||||
(Income) losses from investments in equity securities 2 | 5 | 246 | 171 | 318 | |||||||||
Total Cronos-related special items - (income) expense | $ | 6 | $ | 266 | $ | 186 | $ | 466 | |||||
Losses per share | $ | — | $ | 0.15 | $ | 0.10 | $ | 0.25 | |||||
1 Amounts are related to the non-cash change in the fair value of the warrant (which we irrevocably abandoned in the fourth quarter of 2022) and certain anti-dilution protections.
2 Amounts include our share of special items recorded by Cronos and additional adjustments, if required under the equity method of accounting, related to our investment in Cronos including the $107 million and $205 million non-cash, pre-tax impairment of our investment in Cronos for the years ended 2022 and 2021, respectively.
We recorded corresponding adjustments to the Cronos tax valuation allowance in 2022 and 2021 relating to the special items.
Loss on Early Extinguishment of Debt
For the full-year 2021, we recorded pre-tax losses on early extinguishment of debt of $649 million (or $0.27 per share).
Income Tax Items
In the fourth quarter and for full-year 2022, we recorded tax items of $696 million (or $0.39 per share) and $729 million (or $0.40 per share), respectively, due primarily to the release of valuation allowances on deferred tax assets related to a portion of our investment in JUUL and our Cronos warrant (which we irrevocably abandoned in the fourth quarter of 2022) due to the anticipated ability to utilize these losses.
SMOKEABLE PRODUCTS
Revenues and OCI
Fourth Quarter
Net revenues decreased 2.4%, primarily driven by lower shipment volume, partially offset by higher pricing and lower promotional investments. Revenues net of excise taxes were essentially unchanged.
Reported OCI increased 3.3%, primarily driven by higher pricing, lower promotional investments and lower per unit settlement charges, partially offset by lower shipment volume and higher costs (including higher tobacco and health and certain other litigation items).
Adjusted OCI increased 4.0%, primarily driven by higher pricing, lower promotional investments and lower per unit settlement charges, partially offset by lower shipment volume and higher costs. Adjusted OCI margins increased by 2.2 percentage points to 58.4%.
Full Year
Net revenues decreased 1.7%, primarily driven by lower shipment volume, partially offset by higher pricing and lower promotional investments. Revenues net of excise taxes increased 0.4%.
Reported and adjusted OCI increased 2.8% and 2.9%, respectively, primarily driven by higher pricing and lower promotional investments, partially offset by lower shipment volume, higher costs and higher per unit settlement charges. Adjusted OCI margins increased by 1.4 percentage points to 59%.
Table 2 - Smokeable Products: Revenues and OCI ($ in millions) | |||||||||||||||||
Fourth Quarter | Full Year | ||||||||||||||||
2022 | 2021 | Change | 2022 | 2021 | Change | ||||||||||||
Net revenues | $ | 5,456 | $ | 5,591 | (2.4 | )% | $ | 22,476 | $ | 22,866 | (1.7 | )% | |||||
Excise taxes | (1,000 | ) | (1,134 | ) | (4,289 | ) | (4,754 | ) | |||||||||
Revenues net of excise taxes | $ | 4,456 | $ | 4,457 | — | % | $ | 18,187 | $ | 18,112 | 0.4 | % | |||||
Reported OCI | $ | 2,576 | $ | 2,493 | 3.3 | % | $ | 10,688 | $ | 10,394 | 2.8 | % | |||||
NPM Adjustment Items | (3 | ) | — | (63 | ) | (53 | ) | ||||||||||
Tobacco and health and certain other litigation items | 30 | 11 | 101 | 83 | |||||||||||||
Adjusted OCI | $ | 2,603 | $ | 2,504 | 4.0 | % | $ | 10,726 | $ | 10,424 | 2.9 | % | |||||
Adjusted OCI margins 1 | 58.4 | % | 56.2 | % | 2.2 pp | 59.0 | % | 57.6 | % | 1.4 pp | |||||||
1 Adjusted OCI margins are calculated as adjusted OCI divided by revenues net of excise taxes.
Shipment Volume
Fourth Quarter
Smokeable products segment reported domestic cigarette shipment volume decreased 12.1%, primarily driven by the industry’s decline rate and retail share losses (both of which were impacted by macroeconomic pressures on ATC disposable income) and calendar differences.
When adjusted for calendar differences, smokeable products segment domestic cigarette shipment volume decreased by an estimated 11%.
When adjusted for trade inventory movements, calendar differences and other factors, total estimated domestic cigarette industry volume decreased by an estimated 9%.
Reported cigar shipment volume decreased 3.8%, primarily driven by macroeconomic pressures on ATC disposable income, trade inventory movements and other factors.
Full Year
Smokeable products segment reported domestic cigarette shipment volume decreased 9.7%, primarily driven by the industry’s decline rate and retail share losses (both of which were impacted by macroeconomic pressures on ATC disposable income) and calendar differences, partially offset by trade inventory movements.
When adjusted for calendar differences and trade inventory movements, smokeable products segment domestic cigarette shipment volume decreased by an estimated 9.5%.
When adjusted for trade inventory movements, calendar differences and other factors, total estimated domestic cigarette industry volume decreased by an estimated 8%.
Reported cigar shipment volume decreased 4.0%, primarily driven by macroeconomic pressures on ATC disposable income, trade inventory movements and other factors.
Table 3 - Smokeable Products: Reported Shipment Volume (sticks in millions) | |||||||||||||
Fourth Quarter | Full Year | ||||||||||||
2022 | 2021 | Change | 2022 | 2021 | Change | ||||||||
Cigarettes: | |||||||||||||
Marlboro | 17,597 | 19,848 | (11.3 | )% | 75,406 | 82,970 | (9.1 | )% | |||||
Other premium | 915 | 1,036 | (11.7 | )% | 3,866 | 4,216 | (8.3 | )% | |||||
Discount | 1,195 | 1,539 | (22.4 | )% | 5,406 | 6,607 | (18.2 | )% | |||||
Total cigarettes | 19,707 | 22,423 | (12.1 | )% | 84,678 | 93,793 | (9.7 | )% | |||||
Cigars: | |||||||||||||
Black & Mild | 424 | 440 | (3.6 | )% | 1,727 | 1,796 | (3.8 | )% | |||||
Other | 1 | 2 | (50.0 | )% | 4 | 7 | (42.9 | )% | |||||
Total cigars | 425 | 442 | (3.8 | )% | 1,731 | 1,803 | (4.0 | )% | |||||
Total smokeable products | 20,132 | 22,865 | (12.0 | )% | 86,409 | 95,596 | (9.6 | )% | |||||
Note: Cigarettes volume includes units sold as well as promotional units but excludes units sold for distribution to Puerto Rico, U.S. Territories to overseas military and by Philip Morris Duty Free Inc., none of which, individually or in the aggregate, is material to our smokeable products segment.
Retail Share and Brand Activity
Fourth Quarter
Marlboro retail share of the total cigarette category was 42.2%, a decrease of 0.4 share points, primarily due to increased macroeconomic pressures on ATC disposable income and increased competitive activity. However, Marlboro share of the premium segment was 58.4%, an increase of 0.7 share points versus the prior year and was flat sequentially.
The cigarette industry discount retail share increased 1.7 share points to 27.8%, primarily due to the ATC factors mentioned above.
Full Year
Marlboro retail share of the total cigarette category was 42.5%, a decrease of 0.4 share points, primarily due to increased macroeconomic pressures on ATC disposable income and increased competitive activity. However, Marlboro share of the premium segment grew to 58.2%, an increase of 0.5 share points.
The cigarette industry discount retail share increased 1.4 share points to 26.9%, primarily due to the ATC factors mentioned above.
Table 4 - Smokeable Products: Cigarettes Retail Share (percent) | |||||||||||||
Fourth Quarter | Full Year | ||||||||||||
2022 | 2021 | Percentage | 2022 | 2021 | Percentage | ||||||||
Cigarettes: | |||||||||||||
Marlboro | 42.2 | % | 42.6 | % | (0.4 | ) | 42.5 | % | 42.9 | % | (0.4 | ) | |
Other premium | 2.3 | 2.3 | — | 2.3 | 2.3 | — | |||||||
Discount | 2.9 | 3.3 | (0.4 | ) | 3.1 | 3.5 | (0.4 | ) | |||||
Total cigarettes | 47.4 | % | 48.2 | % | (0.8 | ) | 47.9 | % | 48.7 | % | (0.8 | ) | |
Note: Retail share results for cigarettes are based on data from IRI/MSAi, a tracking service that uses a sample of stores and certain wholesale shipments to project market share and depict share trends. This service tracks sales in the food, drug, mass merchandisers, convenience, military, dollar store and club trade classes. For other trade classes selling cigarettes, retail share is based on shipments from wholesalers to retailers (STARS). This service is not designed to capture sales through other channels, including the internet, direct mail and some illicitly tax-advantaged outlets. It is IRI’s standard practice to periodically refresh its services, which could restate retail share results that were previously released in this service.
ORAL TOBACCO PRODUCTS
Revenues and OCI
Fourth Quarter
Net revenues decreased 4.7%, primarily driven by higher promotional investments in on!, lower shipment volume and a higher percentage of on! shipment volume relative to MST versus the prior year (mix change), partially offset by higher pricing. Revenues net of excise taxes decreased 4.0%.
Reported and adjusted OCI decreased 5.1%, primarily driven by higher promotional investments in on!, lower shipment volume and mix change, partially offset by higher pricing. Adjusted OCI margins declined by 0.7 percentage points to 61.3%.
Full Year
Net revenues decreased 1.1%, primarily driven by higher promotional investments in on!, lower shipment volume and mix change, partially offset by higher pricing. Revenues net of excise taxes decreased 0.6%.
Reported OCI decreased 1.6%, primarily driven by higher promotional investments in on!, lower shipment volume, mix change and higher costs, partially offset by higher pricing and 2021 acquisition-related costs.
Adjusted OCI decreased 3.8%, primarily driven by higher promotional investments in on!, lower shipment volume, mix change and higher costs, partially offset by higher pricing. Adjusted OCI margins declined by 2.2 percentage points to 66.3%.
Table 5 - Oral Tobacco Products: Revenues and OCI ($ in millions) | |||||||||||||||||
Fourth Quarter | Full Year | ||||||||||||||||
2022 | 2021 | Change | 2022 | 2021 | Change | ||||||||||||
Net revenues | $ | 632 | $ | 663 | (4.7 | )% | $ | 2,580 | $ | 2,608 | (1.1 | )% | |||||
Excise taxes | (28 | ) | (34 | ) | (119 | ) | (132 | ) | |||||||||
Revenues net of excise taxes | $ | 604 | $ | 629 | (4.0 | )% | $ | 2,461 | $ | 2,476 | (0.6 | )% | |||||
Reported OCI | $ | 370 | $ | 390 | (5.1 | )% | $ | 1,632 | $ | 1,659 | (1.6 | )% | |||||
Asset impairment, exit, implementation, acquisition and disposition-related costs | — | — | — | 37 | |||||||||||||
Adjusted OCI | $ | 370 | $ | 390 | (5.1 | )% | $ | 1,632 | $ | 1,696 | (3.8 | )% | |||||
Adjusted OCI margins 1 | 61.3 | % | 62.0 | % | (0.7) pp | 66.3 | % | 68.5 | % | (2.2) pp | |||||||
1 Adjusted OCI margins are calculated as adjusted OCI divided by revenues net of excise taxes.
Shipment Volume
Fourth Quarter
Oral tobacco products segment reported domestic shipment volume decreased 4.3%, primarily driven by retail share losses, calendar differences and other factors, partially offset by the industry’s growth rate and trade inventory movements. When adjusted for calendar differences and trade inventory movements, oral tobacco products segment shipment volume decreased by an estimated 3.5%.
Full Year
Oral tobacco products segment reported domestic shipment volume decreased 2.4%, primarily driven by retail share losses, trade inventory movements and calendar differences, partially offset by the industry’s growth rate and other factors. When adjusted for trade inventory movements and calendar differences, oral tobacco products segment shipment volume decreased by an estimated 2%.
Total oral tobacco industry volume increased by an estimated 1% for the six months ended December 31, 2022, primarily driven by growth in oral nicotine pouches, partially offset by declines in MST volumes (which includes the impact of macroeconomic pressures on ATC disposable income).
Table 6 - Oral Tobacco Products: Reported Shipment Volume (cans and packs in millions) | |||||||||||||
Fourth Quarter | Full Year | ||||||||||||
2022 | 2021 | Change | 2022 | 2021 | Change | ||||||||
Copenhagen | 114.1 | 125.2 | (8.9 | )% | 470.6 | 503.6 | (6.6 | )% | |||||
Skoal | 43.3 | 49.2 | (12.0 | )% | 179.4 | 197.4 | (9.1 | )% | |||||
on! | 22.9 | 13.8 | 65.9 | % | 82.5 | 48.4 | 70.5 | % | |||||
Other | 16.8 | 17.8 | (5.6 | )% | 68.1 | 70.9 | (3.9 | )% | |||||
Total oral tobacco products | 197.1 | ||||||||||||
