Altria

Not to be confused with Altera or Nutria.

Altria Group, Inc.

Type	Public S&P 500 Component
Traded as	NYSE: MO
Industry	Tobacco
Founded	1985
Founder(s)	Philip Morris, Kraft Foods, Nabisco Holdings Corporation
Headquarters	Henrico County, VA, US
Area served	Worldwide
Key people	Michael E. Szymanczyk (Chairman) & (CEO)
Products	Tobacco & Wine
Revenue	US$23.6 Billion (FY 2009)
Operating income	US$4.86 Billion (FY 2009)
Net income	US$3.21 Billion (FY 2009)
Total assets	US$36.7 Billion (FY 2009)
Total equity	US$4.07 Billion (FY 2009)
Employees	10,400 - March 2009
Website	Altria.com

Altria Group, Inc. (NYSE: MO) (previously named Philip Morris Companies Inc.) is based in Henrico County, Virginia, and is the parent company of Philip Morris USA, John Middleton, Inc., U.S. Smokeless Tobacco Company, Inc., Philip Morris Capital Corporation, and Chateau Ste. Michelle Wine Estates. It is one of the world's largest tobacco corporations. Philip Morris International was spun off in 2008. In addition, Altria Group, Inc. has a 28.7% economic and voting interest in one of the world's largest brewing companies, UK based SABMiller plc, where it has 3 seats on the 11-person board of directors. It is a component of the S&P 500 and was a component of the Dow Jones Industrial Average until February 19, 2008. The company has its headquarters in an unincorporated area within Henrico County, less than five miles west of the city limits of Richmond and less than ten miles from its downtown Richmond buildings.

On January 27, 2003, Philip Morris Companies Inc. changed its name to Altria Group, Inc. On March 30, 2007, a spin out of Kraft Foods subsidiary (publicly traded since 2001) was concluded through distribution of the remaining stake of shares (88.1%) to Altria shareholders. As a result, Altria no longer holds any interest in Kraft Foods. On March 28, 2008, a similar spin out of Philip Morris International was completed with 100% of shares being distributed to Altria shareholders.

On January 6, 2009, Altria Group, Inc. completed the acquisition of UST Inc., a moist smokeless tobacco manufacturer; UST owned Ste Michelle Wine Estates, a wine company.

History

Altria emerged out of Philip Morris. The onset of "rebranding" of Philip Morris Companies to Altria took place in 2003 (Philip Morris would later split, with PM USA remaining Altria's primary and only consistently held asset). Altria was created because Philip Morris wished to emphasize that its business portfolio had come to consist of more than Philip Morris USA and Philip Morris International; at the time, it owned an 84% stake in Kraft, although that business has since been spun off. The name "Altria" comes from the Latin word for "high" and was part of a trend of companies rebranding to names that previously did not exist, Accenture and Verizon being notable examples. The rebranding took place amidst social, legal and financially troubled circumstances. In 2003 Altria was ranked Fortune number 11, and has steadily declined since. In 2010 Altria Group (MO) ranked at Fortune number 137, whereas its former asset, Philip Morris International was ranked 94th.

In 2007, Altria began selling all its shares of Philip Morris International to Altria stockholders. The company also began a move to purchase cigar manufacturer John Middleton Co. from Bradford Holdings, Inc., which went into effect in 2008. After Philip Morris International spun off, the foreign Philip Morris companies halted the purchase of tobacco from America, which was a major factor associated with the closing of a newly renovated plant in North Carolina, approximately 50% reduction in manufacturing, large-scale layoffs and induced early retirements.

In 2008, Altria officially moved its headquarters to Richmond. With a few exceptions, all blue collar, white collar, and executive employees had long been based at one of several Philip Morris buildings in Richmond and the greater Richmond area. The move of white collar operations to Richmond had taken place after Philip Morris sold its downtown offices in New York City a decade earlier. Aside from the Philip Morris/Altria headquarters, some of their other buildings included the Philip Morris Center for Research and Technology in downtown Richmond, the Manufacturing Center in South Richmond, and the adjacent Operations Center which began shutting down in 2007-2008, as a result of the loss of demand from PMI member companies. The layoffs beginning in 2007 affected thousands of Altria, Altria Client Services, Philip Morris USA, and contracted employees in Richmond and North Carolina.

In 2009, Altria finalized its purchase of UST Inc., whose products included smokeless tobacco (made by U.S. Smokeless Tobacco Company) and wine (made by Ste. Michelle Wine Estates). This ended a short era of competition between the new Marlboro smokeless tobacco products such as snus, and those produced by UST Inc.

Holdings

Altria Group, Inc. owns 100 percent of Philip Morris USA, John Middleton, Inc. and Philip Morris Capital Corporation. It also owns 28.7% of SABMiller PLC.

Before the recent restructuring, the net revenue (and operating income) of Altria Group, Inc. came predominantly from its tobacco business, as is shown in the following table. Altria's share of SABMiller's revenue and profits is not included in the table below because its holding is too small to be consolidated in the group accounts.

Activity	Net revenue in 2006 (millions USD)	Net revenue in 2006 (%)	Operating income in 2006 (millions USD)	Operating income in 2006 (%)
USA tobacco	18,474	18.2%	4,812	26.5%
International tobacco	48,260	47.6%	8,458	46.5%
North American food	23,118	22.8%	3,753	20.7%
International food	11,238	11.1%	964	5.3%
Financial services	317	0.3%	176	1.0%
Total	101,407	100%	18,163	100%

Brands

Tobacco

Philip Morris International brands:

• Alpine
• Assos
• Basic
• Benson & Hedges (American Version)
• Best
• Bristol
• Bond Street
• Boston
• Bucks
• Cambridge
• Chesterfield
• Classic
• Collector's Choice
• Commander
• Diana
• Delicados
• English Ovals
• f6
• Lark
• Long Beach
• L&M
• Marlboro
• Merit
• Muratti
• Multifilter
• Morven Gold
• Next
• Optima
• Parliament
• Peter Jackson
• Philip Morris
• Players
• Petra
• Red & White
• Saratoga
• SG
• Sparta
• Start
• Sampoerna (a brand of Indonesian kreteks)
• Virginia Slims

Wine

• Chateau Ste Michelle
• Columbia Crest
• Stag's Leap Wine Cellars
• Conn Creek
• Red Diamond
• Snoqualmie
• Spring Valley
• Villa Mt Eden
• Erath
• Col Solare
• Northstar
• Villa Antinori
• Tormaresca
• Tignanello
• Antica Napa Valley
• Solaia
• Santa Cristina
• Haras di Pirque
• La Bracessca
• Montenisa
• Hawk Crest
• Fourteen Hands
• Champagne Nicolas Feuillatte
• Palmes d'Or
• Domaine Ste Michelle

Corporate governance

Board of directors

Current members of the board of directors of Altria Group are:

• Michael E. Szymanczyk - Chairman and Chief Executive Officer, Altria Group, Inc.
• Martin J. Barrington - Chief Executive Officer, Altria Group, Inc.
• Craig A. Johnson - President and Chief Executive Officer, Ste. Michelle Wine Estates Ltd.
• David R. Beran - Executive Vice President and Chief Financial Officer, Altria Group, Inc.
• Murray R. Garnick - Senior Vice President of Litigation, Altria Client Services Inc.
• William F. Gifford - President and Chief Executive Officer, Philip Morris USA
• Craig A. Johnson - Executive Vice President, Altria Group, Inc.
• Denise F. Keane - Executive Vice President and General Counsel, Altria Group, Inc.
• Nancy B. Lund - Senior Vice President of Marketing, Altria Client Services Inc.
• John J. Mulligan - President, Philip Morris Capital Corporation
• John R. Nelson - Executive Vice President and Chief Technology Officer, Altria Group, Inc.
• Peter P. Paoli - President and Chief Executive Officer, U.S. Smokeless Tobacco Company
• Craig G. Schwartz - President and Chief Executive Officer, John Middleton Co.
• Howard A. Willard III - Executive Vice President of Strategy and Business Development, Altria Group, Inc.

Headquarters

Prior to being based in Virginia, Philip Morris had its headquarters in Midtown Manhattan, New York City. In 2003 Philip Morris announced that it would move its headquarters to Virginia. The company said that it planned to keep around 750 employees in its former headquarters. Brendan McCormick, a spokesperson for Philip Morris, said that the company estimated that the move would save the company over $60 million each year. The company now has its head offices in an unincorporated area of Henrico County, Virginia, in Richmond.

Political influence

According to the Center for Public Integrity, Altria spent around $101 million on lobbying the United States government between 1998 and 2004, making it the second most active organization in the nation.

Altria also funded astroturf organisations such as The Advancement of Sound Science Coalition which lobbied against the scientific consensus on anthropogenic climate change.

See also

• Tobacco industry
• Philip Morris USA
• Master Settlement Agreement

External links

• Official website