Altria Group, Inc. Reports 2004 Second-Quarter Results.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Altria Group “Philip Morris” redirects here. For the racecar driver, see Philip Morris (autoracer). Altria Group, Inc. (NYSE: MO) (previously named Philip Morris Companies Inc. , Inc. (NYSE NYSE See: New York Stock Exchange : MO) --Diluted Earnings Per Share up 5.8% to $1.27 --Net Earnings up 7.8% to $2.6 Billion --Comparisons Affected by Items Detailed in Attached Reconciliation on Schedule 7 --Reaffirms Previously Disclosed Earnings Guidance of $4.50 to $4.60 Per Share for the Full Year 2004 Altria Group, Inc. (NYSE: MO) today announced second-quarter 2004 diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of were up 5.8% to $1.27, including $0.13 in charges for the previously announced food restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). at Kraft and for an agreement that Philip Morris International Philip Morris International, (PMI) based in Lausanne, Switzerland, held a 15.5% share of the international cigarette market in 2005. Its brands, led by Marlboro and L&M, are sold in over 160 countries around the world. (PMI See Private Mortgage Insurance. ) signed on July July: see month. 9 with the European Community European Community: see European Union. European Community (EC) Organization formed in 1967 with the merger of the European Economic Community, European Coal and Steel Community, and European Atomic Energy Community. and 10 member states. It also reflects the positive impact of $0.15 resulting from a lower overall effective tax rate due to the reversal of tax provisions, $0.05 due to favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. currency, and other items as detailed in the attached reconciliation on Schedule 7. Altria's reported diluted earnings per share of $1.20 in the second quarter a year ago included $0.06 in charges related to a Philip Morris USA Philip Morris USA is the United States tobacco division of Altria Group, Inc. General information On January 27, 2003, Philip Morris Companies Inc. changed its name to Altria Group, Inc. Even under this new name, Altria continues to own 100% of Philip Morris USA. settlement with tobacco growers Growers are the people, animals, plants, and various living creatures that assist in the growing of plants and other living creatures. More specifically, the term "growers" refers to individual people who put forth effort to grow plants for food and medicinal use, including the and initial charges for moving Philip Philip, tetrarch of Ituraea Philip, d. A.D. 34, tetrarch of Ituraea, son of Herod the Great. He was perhaps the ablest of the Herod dynasty. He is mentioned in the Gospel of St. Luke. Morris USA's headquarters to Richmond Richmond, cities, United States Richmond. 1 City (1990 pop. 87,425), Contra Costa co., W Calif., on San Pablo Bay, an inlet of San Francisco Bay; inc. 1905. , VA. "Second-quarter results were solid overall and were aided by strong currency and a favorable tax rate," said Louis C. Camilleri Louis C. Camilleri (b. 1955, Alexandria, Egypt) is the Chairman and CEO of Altria Group, the parent company of Philip Morris. Camilleri received a degree in economics and business administration from HEC Lausanne, the prestigious business school of the University of Lausanne , chairman and chief executive officer of Altria Group, Inc. "Our domestic and international tobacco businesses performed well and continued to implement effective strategies for long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. growth. Our domestic tobacco business continued its momentum, with a particularly strong increase in Marlboro's retail share. Our international tobacco business performed well, but continues to face challenges in France, Germany Germany (jûr`mənē), Ger. Deutschland, officially Federal Republic of Germany, republic (2005 est. pop. 82,431,000), 137,699 sq mi (356,733 sq km). and Italy Italy (ĭt`əlē), Ital. Italia, officially Italian Republic, republic (2005 est. pop. 58,103,000), 116,303 sq mi (301,225 sq km), S Europe. . Outside those difficult markets, PMI's performance is strong and growing, and I am confident that PMI can achieve its long-term growth targets." "Kraft's quarterly results reflect ongoing challenges, including high commodity costs," Mr. Camilleri Camilleri is a surname. People with Camilleri as a surname
n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op that Kraft will achieve better results in the second half and over the long term as it executes against its Sustainable Growth Plan." "Altria Group continues to project diluted earnings per share of $4.50 to $4.60 for the full year 2004," Mr. Camilleri said, "as the positive impact of the tax benefit in the second quarter will essentially offset the combined impact of revised earnings per share targets for Kraft and charges related to the international tobacco agreement with the European Community." The factors described in the Forward-Looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. and Cautionary Statements section of this release represent continuing risks to this projection. A conference call with members of the investment community will be Webcast at 9:00 a.m. Eastern Time on July 20, 2004. Access is available at www.altria.com. ALTRIA GROUP, INC. As described in "Note 14. Segment Reporting segment reporting A type of financial reporting in which the firm discloses information by identifiable industry segments. For example, Union Pacific Corporation reports revenues, income, assets, depreciation, and capital expenditures for each of four " of Altria Group, Inc.'s 2003 Annual Report, management reviews operating companies operating company A business that engages in transactions with outsiders. income, which is defined as operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. before corporate expenses and amortization of intangibles, to evaluate segment performance and allocate To reserve a resource such as memory or disk. See memory allocation. resources. Management believes it is appropriate to disclose this measure to help investors analyze business performance and trends. For a reconciliation of operating companies income to operating income, see the Condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. Statements of Earnings contained in this release. 2004 Second-Quarter Results Net revenues for the second quarter 2004, as detailed in the attached reconciliation on Schedule 2, increased 10.5% versus the second quarter 2003 to $23.0 billion, due to increases from Altria's domestic and international tobacco businesses and North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. food business, and favorable currency of $946 million. Operating income decreased 6.6% to $3.9 billion, due primarily to the $250 million impact of the international tobacco agreement with the European Community and charges for asset impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. , exit and implementation costs related to the food business restructuring and the announced closure of PMI's Eger Eger, city, Hungary Eger (ĕ`gĕr), Ger. Erlau, city (1991 est. pop. 62,474), NE Hungary, on the Eger River. It is the commercial center of a wine-producing region and has food- and tobacco-processing plants. , Hungary Hungary, Hung. Magyarország, officially Republic of Hungary, republic (2005 est. pop. 10,007,000), 35,919 sq mi (93,030 sq km), central Europe. facility, and lower results from operations. Also affecting operating income comparisons were favorable currency of $144 million, the tobacco growers settlement in 2003 and other items described in the attached reconciliation of operating companies income on Schedule 3. Net earnings increased 7.8% to $2.6 billion, due primarily to favorable currency and a lower effective tax rate, partially offset by the previously mentioned charges and lower results from operations. The effective tax rate decreased from 35.2% in the second quarter of 2003 to 26.6% in the second quarter of 2004, reflecting the reversal of tax provisions that are no longer required due to tax events that occurred during the second quarter of 2004. On July 9, 2004, PMI entered into an agreement with the European Community and 10 member states of the European Union European Union (EU), name given since the ratification (Nov., 1993) of the Treaty of European Union, or Maastricht Treaty, to the European Community (EU) that provides for broad cooperation with European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. law enforcement agencies A law enforcement agency (LEA) is a term used to describe any agency which enforces the law. This may be a local or state police, federal agencies such as the Federal Bureau of Investigation (FBI) or the Drug Enforcement Administration (DEA). on anti-contraband and anti-counterfeit efforts. The agreement resolves all disputes between the parties relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc these issues. Under the terms of the agreement, PMI will make 13 payments over 12 years, including $250 million for the initial payment recorded as a pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta charge against its earnings in the second quarter of 2004. The agreement calls for additional payments of $150 million on the first anniversary of the agreement, $100 million on the second anniversary and $75 million each year thereafter for 10 years, each of which is to be adjusted based on certain variables, including PMI's market share in the EU in the year preceding payment. Because future additional payments are subject to these variables, PMI will record charges for them as an expense in cost of sales when product is shipped. During the third quarter of 2004, PMI will begin accruing for payments due on the first anniversary of the agreement. In the second quarter of 2004, Altria Group, Inc. declared a regular quarterly dividend of $0.68 per common share, which represents an annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. rate of $2.72 per common share. DOMESTIC TOBACCO 2004 Second-Quarter Results Philip Morris USA Inc., Altria Group, Inc.'s domestic tobacco business, delivered strong market share performance, with total retail share growing 1.3 share points to 49.8%, due to Marlboro's continued growth. Philip Morris USA's shipment volume increased 0.9% to 48.6 billion units, but remained essentially flat when adjusted for the timing of trade purchases surrounding sur·round tr.v. sur·round·ed, sur·round·ing, sur·rounds 1. To extend on all sides of simultaneously; encircle. 2. To enclose or confine on all sides so as to bar escape or outside communication. n. the July 4th holiday. Premium mix for Philip Morris USA improved by 0.3 percentage points to 91.5%. Operating companies income was up 19.6% to $1.2 billion, primarily reflecting the impact of pre-tax charges of $182 million in the second quarter of 2003 for the tobacco growers settlement, as well as higher volume and improved mix in the second quarter of 2004. The increase in Philip Morris USA's total retail share in the second quarter of 2004 was driven by a 1.8 share point gain in Marlboro. Retail share for both Parliament and Virginia Slims Virginia Slims cigarette trademark marketed to “independent women.” “You’ve come a long way, baby,” as slogan. [Trademarks: Crowley Trade, 630] See : Feminism declined slightly, while share for Basic remained stable, as shown in the following table:
Philip Morris USA Quarterly Retail Share(*)
----------------------------------------------
Q2 2004 Q2 2003 Change
---------- ---------- ----------
Marlboro 39.6% 37.8% + 1.8 pp
Parliament 1.6% 1.7% - 0.1 pp
Virginia Slims 2.3% 2.4% - 0.1 pp
Basic 4.2% 4.2% 0.0 pp
---------- ---------- ----------
Focus Brands 47.7% 46.1% + 1.6 pp
Other Philip Morris USA 2.1% 2.4% - 0.3 pp
---------- ---------- ----------
Total Philip Morris USA 49.8% 48.5% + 1.3 pp
(*)IRI/Capstone Total Retail Panel was developed to measure market
share in retail stores selling cigarettes. It is not designed to
capture Internet or direct mail sales.
Philip Morris USA's retail share of the premium segment increased 0.9 share points to 62% in the second quarter of 2004. Its share of the discount segment increased 0.4 share points to 16%, as Basic held share in this declining segment. During the second quarter, Philip Morris USA began shipping a new line extension, Virginia Slims Ultra Lights 120mm box, for national launch at retail in the third quarter and expanded Parliament Lights 100mm round corner box to national distribution. Marlboro Menthol menthol, white crystalline substance with a characteristic pungent odor. It is derived from the oil of the peppermint plant, Mentha piperita (see mint), or prepared synthetically from coal tar. 72mm, a new premium-priced cigarette launched in the first quarter, contributed to incremental Additional or increased growth, bulk, quantity, number, or value; enlarged. Incremental cost is additional or increased cost of an item or service apart from its actual cost. share growth for the Marlboro Menthol family in the second quarter. INTERNATIONAL TOBACCO 2004 Second-Quarter Results Shipment volume for Philip Morris International Inc. (PMI), Altria Group, Inc.'s international tobacco business, increased 2.8% to 192.7 billion units in the second quarter of 2004, but excluding the impact of acquisitions was essentially flat. Gains in many markets were offset by double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. volume declines in France, Germany and Japan, reflecting overall market declines, as well as the prior year timing of shipments in Japan ahead of a tax-driven price increase in July 2003. Operating companies income for PMI decreased 8.4% to $1.5 billion for the second quarter, due primarily to a $250 million pre-tax charge for the international tobacco cooperation agreement that PMI entered into with the European Community, as well as charges for asset impairment and exit costs related to the announced closure of PMI's Eger, Hungary facility, partially offset by favorable currency of $118 million, the impact of acquisitions and higher pricing. During the second quarter of 2004, PMI achieved widespread market share gains, including increases in the top income markets of Austria Austria (ô`strēə), Ger. Österreich [eastern march], officially Republic of Austria, federal republic (2005 est. pop. 8,185,000), 32,374 sq mi (83,849 sq km), central Europe. , Argentina Argentina (ärjəntē`nə, Span. ärhāntē`nä), officially Argentine Republic, republic (2005 est. pop. 39,538,000), 1,072,157 sq mi (2,776,889 sq km), S South America. , Belgium Belgium (bĕl`jəm), Du. België, Fr. La Belgique, officially Kingdom of Belgium, constitutional kingdom (2005 est. pop. 10,364,000), 11,781 sq mi (30,513 sq km), NW Europe. , France, Greece Greece, Gr. Hellas or Ellas, republic (2005 est. pop. 10,668,000), 50,944 sq mi (131,945 sq km), SE Europe. It occupies the southernmost part of the Balkan Peninsula and borders on the Ionian Sea in the west, on the Mediterranean Sea in the south, on , Japan, Mexico Mexico, city, Mexico Mexico or Mexico City, Span. Ciudad de México (Méjico), city (1990 pop. 8,236,960; 1991 met. area est. 20,899,000), central Mexico, capital and largest city of Mexico. , Poland Poland, Pol. Polska, officially Republic of Poland, republic (2005 est. pop. 38,635,000), 120,725 sq mi (312,677 sq km), central Europe. It borders on Germany in the west, on the Baltic Sea and the Kaliningrad region of Russia in the north, on Lithuania, , Russia Russia, officially the Russian Federation, Rus. Rossiya, republic (2005 est. pop. 143,420,000), 6,591,100 sq mi (17,070,949 sq km). , Saudi Arabia Saudi Arabia (sä  `dē ərā`bēə, sou`–, sô–), officially Kingdom of Saudi Arabia, kingdom (2005 est. pop. , Spain Spain, Span. España (āspä`nyä), officially Kingdom of Spain, constitutional monarchy (2005 est. pop. 40,341,000), 194,884 sq mi (504,750 sq km), including the Balearic and Canary islands, SW Europe. , Thailand Thailand (tī`lănd, –lənd), Thai Prathet Thai [land of the free], officially Kingdom of Thailand, constitutional monarchy (2005 est. pop. 65,444,000), 198,455 sq mi (514,000 sq km), Southeast Asia. , Turkey, the Ukraine Ukraine (y`krān, ykrān`), Ukr. Ukraina, republic (2005 est. pop. and the United Kingdom.Total Marlboro shipments were down 0.9% in the second quarter of 2004 versus the second quarter of 2003, due primarily to declines in France and Germany. In Japan, Marlboro volume was also down, reflecting a difficult comparison with the second quarter of 2003 when volume benefited from trade buying in Buying in has several meanings. In the securities market it refers to a process by which the buyer of securities, whose seller fails to deliver the securities contracted for, can 'buy in' the securities from a third party with the defaulting seller to make good. advance of the July 2003 tax increase. However, Marlboro volume was higher in many markets, most notably in Korea Korea (kôrē`ə, kə–), Korean Hanguk or Choson, region and historic country (85,049 sq mi/220,277 sq km), E Asia. , Mexico, Poland, the Philippines Philippines officially Republic of the Philippines Island country, western Pacific Ocean, on an archipelago off the southeast coast of Asia. Area: 122,121 sq mi (316,294 sq km). Population (2005 est.): 84,191,000. , Romania Romania (rōmān`ēə, –yə) or Rumania (r –), republic (v), 91,699 sq mi (237,500 sq km), SE Europe. , Russia, Saudi Arabia,
Serbia Serbia (sûr`bēə), Serbian Srbija (sŭr`bēä), officially Republic of Serbia, republic (1995 est. pop. , Spain, the Ukraine and the United Kingdom. Share gains for
Marlboro were achieved in the key markets of Argentina, Belgium, the
Czech Republic Czech Republic, Czech Česká Republika (2005 est. pop. 10,241,000), republic, 29,677 sq mi (78,864 sq km), central Europe. It is bordered by Slovakia on the east, Austria on the south, Germany on the west, and Poland on the north. , Japan, Mexico, Poland, Portugal Portugal (pôr`chəgəl), officially Portuguese Republic, republic (2005 est. pop. 10,566,000), 35,553 sq mi (92,082 sq km), SW Europe, on the western side of the Iberian Peninsula and including the Madeira Islands and the Azores in the , Russia, Spain, the
Ukraine and the United Kingdom.In Western Europe Western Europe The countries of western Europe, especially those that are allied with the United States and Canada in the North Atlantic Treaty Organization (established 1949 and usually known as NATO). , shipment volume decreased 7.3% for the second quarter of 2004, due mainly to continued total industry declines in France and Germany. Total market share in Western Europe was down 0.3 share points to 38.4%. In France, the total market declined 26.4%, due mainly to tax-driven price increases, and PMI's volume was down 19.8%. However, PMI's market share was up 0.5 points to 39.9%, driven by Basic and the Philip Morris brand and benefiting from the resilience resilience (r  ·zilˑ·yens),n of Marlboro. In Germany, the total cigarette market declined 20% in the second quarter due to the March tax-driven price increase and consumer down trading to low-priced tobacco products, particularly tobacco portions. PMI's volume in Germany was down 20.7%. At the end of April, PMI entered the tobacco portions segment in Germany under the Marlboro and Next brands and both are performing well, with an 8.1% total share of the tobacco portions segment in the second quarter. PMI's cigarette market share in Germany was down slightly to 37.2%, due to the growth of low-price trade brands. In Italy, shipments were up 2.6%, reflecting a low base in April 2003 due to trade purchases in advance of the March 2003 price increase and two additional selling days in the second quarter of 2004. PMI's share was down 3.3 points to 51.2% as Marlboro and Diana Diana, in Roman religion Diana (dīăn`ə), in Roman religion, goddess of the moon, forests, animals, and women in childbirth. She was probably originally a forest goddess and a special patroness of women. remained under pressure from low-price competitive brands. However, PMI's market share has been stable on a sequential basis since March 2004. PMI launched L&M in Italy in May to establish a presence in the low-price segment and the brand is performing in line with expectations. In Spain, volume rose 6.2% and share increased 1.6 share points to 35.7%, driven by the strong performance of Marlboro and Chesterfield Chesterfield, city (1991 pop. 73,352) and district, Derbyshire, central England. An important industrial center, Chesterfield produces mining equipment, railroad cars, metal products, glass, and pottery. , and the launch of Next. In Central Europe Central Europe is the region lying between the variously and vaguely defined areas of Eastern and Western Europe. In addition, Northern, Southern and Southeastern Europe may variously delimit or overlap into Central Europe. , volume increased 13.9%, due mainly to gains in Greece and Serbia, which benefited from the impact of acquisitions, and an increase in Romania. These gains were partially offset by lower volume in Hungary and Poland, as well as declines in the Czech and Slovak Slo·vak also Slo·va·ki·an n. 1. a. A native or inhabitant of Slovakia. b. A person of Slovak descent. 2. The Slavic language of the Slovaks. adj. Republics. Volume excluding acquisitions was down 4.4%, due primarily to the declines in the Czech and Slovak Republics. In the Czech Republic, PMI's brands Petra Petra (pē`trə), ancient rock city, in present-day Jordan, known to the Arabs as Wadi Musa for the stream that flows through it. A narrow, winding pass between towering walls leads to the open plain upon which stood the ancient city. and Sparta Sparta (spär`tə), city of ancient Greece, capital of Laconia, on the Eurotas (Evrótas) River in the Peloponnesus. Spartan Society lost share to very low-price competitive brands. In the Slovak Republic, comparisons were affected by the timing of shipments in advance of the 2003 excise tax Excise Tax 1. An indirect tax charged on the sale of a particular good. 2. A penalty tax applied to ineligible transactions in retirement accounts. This penalty is assessed by and paid to the IRS. Notes: 1. increase and a lower total market due to an increase in illegal cigarette sales. In Eastern Europe Eastern Europe The countries of eastern Europe, especially those that were allied with the USSR in the Warsaw Pact, which was established in 1955 and dissolved in 1991. , the Middle East and Africa, volume grew 8.1%, due primarily to strength in Saudi Arabia, Turkey and the Ukraine, partially offset by lower volume in Russia. In Turkey, volume rose 22.0% and share grew 7.6 points to 39.3% due to the continued strong performance of L&M and Muratti The Muratti is an annual men's football match, inaugurated in 1905, between the Channel Islands of Guernsey, Jersey and Alderney, the prize for winning being a trophy called the Muratti Vase. . In the Ukraine, aided by higher sales of Marlboro, volume increased 26.7%. In Russia, although shipments were down 3.3% due to a reduction in distributor inventories during the quarter, retail sales were up and PMI's market share rose 1.5 share points to 26.1%, reflecting higher sales of Parliament, Marlboro, L&M, Next and Chesterfield. In Asia, volume advanced 1.5%, driven by strong performances in Korea, Malaysia Malaysia (məlā`zhə), independent federation (2005 est. pop. 23,953,000), 128,430 sq mi (332,633 sq km), Southeast Asia. The official capital and by far the largest city is Kuala Lumpur; Putrajaya is the adminstrative capital. , the Philippines and Thailand, partially offset by Japan. In Korea, volume increased 37.9%, benefiting from the growth of Lark One, Marlboro Ultra Lights and the recent launch of Elan (Emulated LAN) A virtual LAN in the ATM world. See LANE and virtual LAN. Elan - ["Top-down Programming with Elan", C.H.A. Koster, Ellis Horwood 1987]. , a premium-price slim cigarette. In the Philippines, volume was higher due to Marlboro's strong growth and the impact of acquired volume. In Japan, the total market declined 17.4% and PMI's volume was down 11.3%, due to the continued adverse impact of the July 2003 tax-driven price increases and a difficult comparison with last year when shipments benefited from trade buying in advance of the tax increase. PMI's share in Japan was up 0.7 share points to 24.4%, driven by Marlboro. In Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. , volume rose 0.7%, driven primarily by Mexico, partially offset by Argentina. In Mexico, shipments in the quarter benefited from higher trade purchasing in advance of a price increase in early July 2004. PMI's growth of 2.8 share points to 61.6% in Mexico reflects Marlboro's strong performance and the success of a recently launched B&H Lights Menthol line extension. In Argentina, the overall market was down 7.5% following the accumulated ac·cu·mu·late v. ac·cu·mu·lat·ed, ac·cu·mu·lat·ing, ac·cu·mu·lates v.tr. To gather or pile up; amass. See Synonyms at gather. v.intr. To mount up; increase. 44% price increases during the last 12 months. PMI's volume declined 6.8% in Argentina, while share was up 0.5 share points to 66.8% in the second quarter of 2004. In worldwide duty-free du·ty-free adj. 1. Exempt from customs duties: duty-free merchandise. 2. Of, relating to, or being a region or establishment in which imported goods are exempt from customs duties: , volume increased 16.6%, reflecting the global recovery in travel and a favorable comparison with last year's second quarter, which was depressed by the effects of SARS and the Iraq war Iraq War: see under Persian Gulf Wars. Iraq War or Second Persian Gulf War Brief conflict in 2003 between Iraq and a combined force of troops largely from the U.S. and Great Britain; and a subsequent U.S. . FOOD Yesterday, Kraft Foods Kraft Foods Inc. (NYSE: KFT) is the largest food and beverage company headquartered in North America and the second largest in the world after Nestlé SA. The Philip Morris Company (now known as Altria Group), a company that produces tobacco products, acquired Kraft for Inc. (Kraft) reported 2004 second-quarter results. Kraft's worldwide net revenues were up 4.6%, due to favorable currency of $237 million, volume/mix and net pricing. Kraft's worldwide total volume was up 3.6%, as ongoing volume growth of 3.9% (including 3.1 percentage points of growth from acquisitions) was partially offset by the impact of divestitures. Volume strength across many businesses was partially offset by challenges in categories impacted by low-carbohydrate diet Low-carbohydrate diets or low-carb diets are nutritional programs that advocate restricted carbohydrate consumption, based on research that ties consumption of certain carbohydrates with increased blood insulin levels, and overexposure to insulin with metabolic syndrome (the trends, and softness in some Western European markets, particularly France and the Nordic region. Operating income declined 23.7% to $1.2 billion, as higher commodity costs, increased marketing investment, asset impairment, exit and implementation costs for the previously announced restructuring program of $138 million, and increased benefit costs and restricted stock expense were partially offset by restructuring savings, favorable currency of $26 million and all other operations. During the quarter, Kraft began successfully integrating the acquisition of Veryfine Veryfine is a juice beverage brand currently owned by Kraft Foods North America, a division of Kraft Foods Global, Inc. Products Inc., the manufacturer of Fruit2O Fruit2o, manufactured by Kraft, is a lightly flavored, non-carbonated water beverage introduced in 1999. Fruit2o was introduced to compete not only with the bottled water market but also with the soft drink market. flavored water and Veryfine juices and juice drinks. It also announced an agreement with Tazo
Tazo Tea Company is a tea manufacturer and distributor based in Portland, Oregon, known for their "New age" style marketing and product labeling. Tea Company, a wholly-owned subsidiary of Starbucks Corporation, to license the Tazo line of tea products, including hot tea and bottled ready-to-drink iced and juice flavored teas, for sale in multiple channels across the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . In addition, Kraft announced an alliance with Dr. Arthur Arthur, king of Britain: see Arthurian legend. Arthur king and hero of Scotland, Wales, and England. [Arthurian Legend: Parrinder, 28] See : Heroism Agatston to use the South Beach Diet trademark to promote certain Kraft products. NORTH AMERICAN FOOD 2004 Second-Quarter Results For the second quarter of 2004, Kraft North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. Commercial net revenues grew 3.7%, as higher volumes including acquisitions, commodity-driven pricing on cheese, meats and foodservice The foodservice (or food service) industry (US English; catering industry in British English) encompasses those places, institutions, and companies responsible for any meal eaten away from home. , and favorable currency of $40 million were partially offset by increased promotional spending. Volume was up 4.9% (including 3.8 percentage points of growth from acquisitions). Solid growth in categories with increased marketing investment including cheese, coffee, cold cuts and salted snacks was partially offset by declines in categories facing challenges from low-carbohydrate diet trends, including cereals and confections. Operating companies income declined 20.7% to $1.1 billion due to higher commodity costs net of pricing, increased marketing investment, higher benefit costs and exit and implementation costs for the restructuring program of $48 million, partially offset by the contribution from volume growth and favorable currency of $7 million. INTERNATIONAL FOOD 2004 Second-Quarter Results For the second quarter of 2004, net revenues for Kraft International Commercial grew 6.8% as favorable currency of $197 million and volume gains from acquisitions were partially offset by the impact of divestitures and increased promotional spending in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). . Volume was
down 0.2% due to divestitures, while volume from ongoing businesses was
up 1.1%, benefiting from tack-on acquisitions, which accounted for 1.3
percentage points of growth. Overall developing market growth was solid,
with gains in Argentina, Brazil Brazil (brəzĭl`), Port. Brasil, officially Federative Republic of Brazil, republic (2005 est. pop. 186,113,000), 3,286,470 sq mi (8,511,965 sq km), E South America. , China and Puerto Rico Puerto Rico (pwār`tō rē`kō), island (2005 est. pop. 3,917,000), 3,508 sq mi (9,086 sq km), West Indies, c.1,000 mi (1,610 km) SE of Miami, Fla. , partially offset
by a double-digit decline in beverages in Mexico and weakness in Russia.
Operating companies income decreased 33.6% to $225 million, as exit
costs for the restructuring program of $90 million, higher marketing
investment, increased product costs, unfavorable mix and the impact of
divestitures were partially offset by favorable currency of $19 million.FINANCIAL SERVICES The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. 2004 Second-Quarter Results Operating companies income for Philip Morris Capital Corporation (PMCC PMCC Product Moment Correlation Coefficient PMCC Postmark Collectors Club PMCC Professional Military Comptroller Course PMCC Packet Mode Channel Connect PMCC Project Management Core Competency PMCC Pensky-Martens Closed Cup test ) increased 52.4% to $125 million for the second quarter of 2004, due primarily to $84 million of gains on the sale of assets, partially offset by lower lease portfolio revenues as a result of PMCC's shift in strategic direction announced in 2003. Altria Group, Inc. Profile Altria Group, Inc. is the parent company of Kraft Foods Inc., with 84.9% ownership of outstanding Kraft common shares, Philip Morris International Inc., Philip Morris USA Inc. and Philip Morris Capital Corporation. In addition, Altria Group, Inc. has a 36% economic interest in SABMiller SABMiller (South African Breweries - Miller) (LSE: SAB, JSE: SAB,Official site) is one of the world’s largest brewers, with brewing interests and distribution agreements in over 60 countries across six continents. plc. The brand portfolio of Altria Group, Inc.'s consumer packaged goods Noun 1. packaged goods - groceries that are packaged for sale foodstuff, grocery - (usually plural) consumer goods sold by a grocer plural, plural form - the form of a word that is used to denote more than one companies includes such well-known names as Kraft, Jacobs, L&M, Marlboro, Maxwell House Maxwell House is a brand of coffee manufactured by a like-named division of Kraft Foods. It is named in honor of the Maxwell House Hotel in Nashville, Tennessee. For many years until the late 1980s it was the largest-selling coffee in the U.S. and is currently (ca. , Nabisco, Oreo, Oscar Mayer Oscar Mayer is an American meat and cold cut production company, now owned by Kraft Foods, known for its hot dogs, bologna, bacon and Lunchables products. German immigrant Oscar Ferdinand Mayer , Parliament, Philadelphia, Post and Virginia Slims. Altria Group, Inc. recorded 2003 net revenues of $81.8 billion. Trademarks and service marks mentioned in this release are the registered property of, or licensed by, the subsidiaries of Altria Group, Inc. Forward-Looking and Cautionary Statements This press release contains projections of future results and other forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that involve a number of risks and uncertainties and are made pursuant to the Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. The following important factors could cause actual results and outcomes to differ materially from those contained in such forward-looking statements. Altria Group, Inc.'s consumer products subsidiaries are subject to changing prices for raw materials; intense price competition; changes in consumer preferences and demand for their products; fluctuations in levels of customer inventories; the effects of foreign economies and local economic and market conditions; and unfavorable currency movements. Their results are dependent upon their continued ability to promote brand equity successfully; to anticipate and respond to new consumer trends; to develop new products and markets and to broaden brand portfolios in order to compete effectively with lower-priced products; to improve productivity; and to respond effectively to changing prices for their raw materials. Altria Group, Inc.'s tobacco subsidiaries (Philip Morris USA and Philip Morris International) continue to be subject to litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. , including risks associated with adverse jury and judicial determinations, courts reaching conclusions at variance var·i·ance n. 1. a. The act of varying. b. The state or quality of being variant or variable; a variation. c. A difference between what is expected and what actually occurs. 2. with the company's understanding of applicable law, bonding requirements and the absence of adequate appellate Relating to appeals; reviews by superior courts of decisions of inferior courts or administrative agencies and other proceedings. remedies to get timely relief from any of the foregoing; price disparities and changes in price disparities between premium and lowest-price brands; legislation, including actual and potential excise tax increases; increasing marketing and regulatory restrictions; the effects of price increases related to excise tax increases and concluded tobacco litigation settlements on consumption rates and consumer preferences within price segments; health concerns relating to the use of tobacco products and exposure to environmental tobacco smoke environmental tobacco smoke (ETS/passive smoke), n the gaseous by-product of burning tobacco products, including but not limited to commercially manufactured cigarettes and cigars; contains toxic elements harmful to the health of adults and children ; governmental regulation; privately imposed smoking restrictions; and governmental and grand jury investigations. Altria Group, Inc.'s consumer products subsidiaries are subject to other risks detailed from time to time in its publicly filed documents, including its Quarterly Report on Form 10-Q Form 10-Q See 10-Q. for the period ended March 31, 2004. Altria Group, Inc. cautions that the foregoing list of important factors is not complete and does not undertake to update any forward-looking statements that it may make.
ALTRIA GROUP, INC. Schedule 1
and Subsidiaries
Condensed Statements of Earnings
For the Quarters Ended June 30,
(in millions, except per share data)
2004 2003 % Change
---------------------------
Net revenues $ 23,008 $20,831 10.5 %
Cost of sales 8,636 7,991 8.1 %
Excise taxes on products (*) 6,563 5,344 22.8 %
-----------------
Gross profit 7,809 7,496 4.2 %
Marketing, administration and research
costs 3,304 2,928
Domestic tobacco legal settlement - 182
Domestic tobacco headquarters relocation
charges 10 9
International tobacco EC agreement 250 -
Asset impairment and exit costs 152 -
-----------------
Operating companies income 4,093 4,377 (6.5)%
Amortization of intangibles 5 3
General corporate expenses 164 183
Asset impairment and exit costs 8 -
-----------------
Operating income 3,916 4,191 (6.6)%
Interest and other debt expense, net 297 263
-----------------
Earnings before income taxes and minority
interest 3,619 3,928 (7.9)%
Provision for income taxes 963 1,382 (30.3)%
-----------------
Earnings before minority interest 2,656 2,546 4.3 %
Minority interest in earnings and other,
net 29 109
-----------------
Net earnings $ 2,627 $ 2,437 7.8 %
=================
Basic earnings per share (**) $ 1.28 $ 1.20 6.7 %
=================
Diluted earnings per share (**) $ 1.27 $ 1.20 5.8 %
=================
Weighted average number of
shares outstanding - Basic 2,047 2,023 1.2 %
- Diluted 2,062 2,029 1.6 %
(*) The detail of excise taxes on products sold is as follows:
2004 2003
-----------------
Domestic tobacco $ 958 $ 951
International tobacco 5,605 4,393
-------- -------
Total excise taxes $ 6,563 $ 5,344
======== =======
(**) Basic and diluted earnings per share are computed for each of the
periods presented. Accordingly, the sum of the quarterly earnings per
share amounts may not agree to the year-to-date amounts.
ALTRIA GROUP, INC. Schedule 2
and Subsidiaries
Selected Financial Data by Business Segment
For the Quarters Ended June 30,
(in millions)
North
Domestic International American International
tobacco tobacco food food
---------------------------------------------------
2004 Net Revenues $ 4,582 $ 10,064 $ 5,697 $ 2,508
2003 Net Revenues 4,498 8,388 5,493 2,348
% Change 1.9% 20.0% 3.7% 6.8%
Reconciliation:
---------------
2003 Net Revenues $ 4,498 $ 8,388 $ 5,493 $ 2,348
Divested businesses
- 2004 - - - -
Divested businesses
- 2003 - - - (33)
Currency - 709 40 197
Operations 84 967 164 (4)
---------------------------------------------------
2004 Net Revenues $ 4,582 $ 10,064 $ 5,697 $ 2,508
===================================================
Financial
services Total
--------------------------
2004 Net Revenues $ 157 $ 23,008
2003 Net Revenues 104 20,831
% Change 51.0% 10.5%
Reconciliation:
---------------
2003 Net Revenues $ 104 $ 20,831
Divested businesses -
2004 - -
Divested businesses -
2003 - (33)
Currency - 946
Operations 53 1,264
--------------------------
2004 Net Revenues $ 157 $ 23,008
==========================
Note: The detail of excise taxes on products sold is as follows:
2004 2003
--------------------------
Domestic tobacco $ 958 $ 951
International
tobacco 5,605 4,393
--------------------------
Total excise taxes $ 6,563 $ 5,344
==========================
Currency increased international tobacco excise taxes by $412 million.
ALTRIA GROUP, INC. Schedule 3
and Subsidiaries
Selected Financial Data by Business Segment
For the Quarters Ended June 30,
(in millions)
North
Domestic International American International
tobacco tobacco food food
---------------------------------------------------
2004 Operating
Companies Income $ 1,212 $ 1,468 $ 1,063 $ 225
2003 Operating
Companies Income 1,013 1,603 1,340 339
% Change 19.6% (8.4)% (20.7)% (33.6)%
Reconciliation:
---------------
2003 Operating
Companies Income $ 1,013 $ 1,603 $ 1,340 $ 339
Divested businesses
- 2004 - - - -
Divested businesses
- 2003 - - - (7)
Domestic tobacco
legal settlement
- 2003 182 - - -
Domestic tobacco
headquarters
relocation charges
- 2004 (10) - - -
Domestic tobacco
headquarters
relocation charges
- 2003 9 - - -
International
tobacco EC
agreement - 2004 - (250) - -
Asset impairment
and exit costs
- 2004 - (23) (39) (90)
Implementation
costs - 2004 - - (9) -
Currency - 118 7 19
Operations 18 20 (236) (36)
---------------------------------------------------
2004 Operating
Companies Income $ 1,212 $ 1,468 $ 1,063 $ 225
===================================================
Financial
services Total
--------------------------
2004 Operating
Companies Income $ 125 $ 4,093
2003 Operating
Companies Income 82 4,377
% Change 52.4% (6.5)%
Reconciliation:
---------------
2003 Operating
Companies Income $ 82 $ 4,377
Divested businesses
- 2004 - -
Divested businesses
- 2003 - (7)
Domestic tobacco
legal settlement
- 2003 - 182
Domestic tobacco
headquarters
relocation charges
- 2004 - (10)
Domestic tobacco
headquarters
relocation charges
- 2003 - 9
International
tobacco EC
agreement
- 2004 - (250)
Asset impairment
and exit costs
- 2004 - (152)
Implementation
costs - 2004 - (9)
Currency - 144
Operations 43 (191)
--------------------------
2004 Operating
Companies Income $ 125 $ 4,093
==========================
ALTRIA GROUP, INC. Schedule 4
and Subsidiaries
Condensed Statements of Earnings
For the Six Months Ended June 30,
(in millions, except per share data)
2004 2003 % Change
--------------------------------
Net revenues $ 44,847 $ 40,202 11.6 %
Cost of sales 16,720 15,556 7.5 %
Excise taxes on products (*) 12,880 10,231 25.9 %
---------------------
Gross profit 15,247 14,415 5.8 %
Marketing, administration and research
costs 6,511 5,798
Domestic tobacco legal settlement - 182
Domestic tobacco headquarters
relocation charges 20 9
International tobacco EC agreement 250 -
Asset impairment and exit costs 461 -
---------------------
Operating companies income 8,005 8,426 (5.0)%
Amortization of intangibles 9 5
General corporate expenses 328 366
Asset impairment and exit costs 24 -
---------------------
Operating income 7,644 8,055 (5.1)%
Interest and other debt expense, net 597 546
---------------------
Earnings before income taxes and
minority interest 7,047 7,509 (6.2)%
Provision for income taxes 2,149 2,643 (18.7)%
---------------------
Earnings before minority interest 4,898 4,866 0.7 %
Minority interest in earnings, net 77 243
---------------------
Net earnings $ 4,821 $ 4,623 4.3 %
=====================
Basic earnings per share (**) $ 2.36 $ 2.28 3.5 %
=====================
Diluted earnings per share (**) $ 2.34 $ 2.27 3.1 %
=====================
Weighted average number of
shares outstanding - Basic 2,044 2,027 0.8 %
- Diluted 2,061 2,035 1.3 %
(*) The detail of excise taxes on products sold is as follows:
2004 2003
---------------------
Domestic tobacco $ 1,810 $ 1,817
International tobacco 11,070 8,414
---------------------
Total excise taxes $ 12,880 $ 10,231
=====================
(**) Basic and diluted earnings per share are computed for each of the
periods presented. Accordingly, the sum of the quarterly earnings per
share amounts may not agree to the year-to-date amounts.
ALTRIA GROUP, INC. Schedule 5
and Subsidiaries
Selected Financial Data by Business Segment
For the Six Months Ended June 30,
(in millions)
North
Domestic International American International
tobacco tobacco food food
---------------------------------------------------
2004 Net Revenues $ 8,586 $ 20,107 $ 11,096 $ 4,802
2003 Net Revenues 8,315 16,467 10,759 4,441
% Change 3.3% 22.1% 3.1% 8.1%
Reconciliation:
---------------
2003 Net Revenues $ 8,315 $ 16,467 $ 10,759 $ 4,441
Divested businesses
- 2004 - - - -
Divested businesses
- 2003 - - - (64)
Currency - 1,701 112 431
Operations 271 1,939 225 (6)
---------------------------------------------------
2004 Net Revenues $ 8,586 $ 20,107 $ 11,096 $ 4,802
===================================================
Financial
services Total
--------------------------
2004 Net Revenues $ 256 $ 44,847
2003 Net Revenues 220 40,202
% Change 16.4% 11.6%
Reconciliation:
---------------
2003 Net Revenues $ 220 $ 40,202
Divested businesses
- 2004 - -
Divested businesses
- 2003 - (64)
Currency - 2,244
Operations 36 2,465
--------- -----------
2004 Net Revenues $ 256 $ 44,847
========= ===========
Note: The detail of excise taxes on products sold is as follows:
2004 2003
--------------------------
Domestic tobacco $ 1,810 $ 1,817
International
tobacco 11,070 8,414
--------------------------
Total excise taxes $ 12,880 $ 10,231
==========================
Currency increased international tobacco excise taxes by $998 million.
ALTRIA GROUP, INC. Schedule 6
and Subsidiaries
Selected Financial Data by Business Segment
For the Six Months Ended June 30,
(in millions)
North
Domestic International American International
tobacco tobacco food food
---------------------------------------------------
2004 Operating
Companies Income $ 2,182 $ 3,303 $ 1,909 $ 416
2003 Operating
Companies Income 1,755 3,293 2,613 600
% Change 24.3% 0.3% (26.9)% (30.7)%
Reconciliation:
-------------------
2003 Operating
Companies Income $ 1,755 $ 3,293 $ 2,613 $ 600
Divested businesses
- 2004 - - - -
Divested businesses
- 2003 - - - (12)
Domestic tobacco
legal settlement
- 2003 182 - - -
Domestic tobacco
headquarters
relocation charges
- 2004 (20) - - -
Domestic tobacco
headquarters
relocation charges
- 2003 9 - - -
International
tobacco EC
agreement - 2004 - (250) - -
Asset impairment
and exit costs
- 2004 (1) (23) (301) (136)
Implementation
costs - 2004 - - (9) (1)
Currency - 361 18 43
Operations 257 (78) (412) (78)
---------------------------------------------------
2004 Operating
Companies Income $ 2,182 $ 3,303 $ 1,909 $ 416
===================================================
Financial
services Total
--------------------------
2004 Operating
Companies Income $ 195 $ 8,005
2003 Operating
Companies Income 165 8,426
% Change 18.2% (5.0)%
Reconciliation:
---------------
2003 Operating
Companies Income $ 165 $ 8,426
Divested businesses
- 2004 - -
Divested businesses
- 2003 - (12)
Domestic tobacco
legal settlement
- 2003 - 182
Domestic tobacco
headquarters
relocation charges
- 2004 - (20)
Domestic tobacco
headquarters
relocation charges
- 2003 - 9
International
tobacco EC
agreement - 2004 - (250)
Asset impairment
and exit costs
- 2004 - (461)
Implementation
costs - 2004 - (10)
Currency - 422
Operations 30 (281)
--------------------------
2004 Operating
Companies Income $ 195 $ 8,005
==========================
ALTRIA GROUP, INC. Schedule 7
and Subsidiaries
Net Earnings and Diluted Earnings Per Share
For the Quarters Ended June 30,
($ in millions, except per share data)
Net Diluted
Earnings E.P.S. (*)
------------ ------------
2004 $ 2,627 $ 1.27
2003 $ 2,437 $ 1.20
% Change 7.8 % 5.8 %
Reconciliation:
---------------
2003 Reported $ 2,437 $ 1.20
2003 Domestic tobacco legal settlement 118 0.06
2003 Domestic tobacco headquarters
relocation charges 6 -
------------ ------------
124 0.06
------------ ------------
2004 Domestic tobacco headquarters
relocation charges (6) -
2004 International tobacco EC agreement (161) (0.08)
2004 Corporate asset impairment and
exit costs (5) -
2004 Asset impairment, exit and
implementation costs, net of
minority interest impact (89) (0.05)
------------ ------------
(261) (0.13)
------------ ------------
Currency 93 0.05
Change in shares - (0.02)
Change in tax rate 308 0.15
Operations (74) (0.04)
------------ ------------
2004 Reported $ 2,627 $ 1.27
============ ============
(*) Basic and diluted earnings per share are computed for each of the
periods presented. Accordingly, the sum of the quarterly earnings per
share amounts may not agree to the year-to-date amounts.
ALTRIA GROUP, INC. Schedule 8
and Subsidiaries
Net Earnings and Diluted Earnings Per Share
For the Six Months Ended June 30,
($ in millions, except per share data)
Net Diluted
Earnings E.P.S. (*)
------------ ------------
2004 $ 4,821 $ 2.34
2003 $ 4,623 $ 2.27
% Change 4.3 % 3.1 %
Reconciliation:
---------------
2003 Reported $ 4,623 $ 2.27
2003 Domestic tobacco legal settlement 118 0.06
2003 Domestic tobacco headquarters
relocation charges 6 -
------------ ------------
124 0.06
------------ ------------
2004 Domestic tobacco headquarters
relocation charges (13) (0.01)
2004 International tobacco EC agreement (161) (0.08)
2004 Corporate asset impairment and exit
costs (15) (0.01)
2004 Asset impairment, exit and
implementation costs, net of
minority interest impact (259) (0.12)
------------ ------------
(448) (0.22)
------------ ------------
Currency 273 0.13
Change in shares - (0.03)
Change in tax rate 331 0.16
Operations (82) (0.03)
------------ ------------
2004 Reported $ 4,821 $ 2.34
============ ============
(*) Basic and diluted earnings per share are computed for each of the
periods presented. Accordingly, the sum of the quarterly earnings per
share amounts may not agree to the year-to-date amounts.
ALTRIA GROUP, INC. Schedule 9
and Subsidiaries
Condensed Balance Sheets
(in millions, except ratios)
June 30, December 31,
2004 2003
-------------- --------------
Assets
------
Cash and cash equivalents $ 5,031 $ 3,777
All other current assets 17,116 17,605
Property, plant and equipment, net 15,773 16,067
Goodwill 28,316 27,742
Other intangible assets, net 11,442 11,803
Other assets 12,047 10,641
-------------- --------------
Total consumer products assets 89,725 87,635
Total financial services assets 8,196 8,540
-------------- --------------
Total assets $ 97,921 $ 96,175
============== ==============
Liabilities and Stockholders' Equity
------------------------------------
Short-term borrowings $ 2,576 $ 1,715
Current portion of long-term debt 1,749 1,661
Accrued settlement charges 2,338 3,530
All other current liabilities 14,391 14,487
Long-term debt 18,488 18,953
Deferred income taxes 7,479 7,295
Other long-term liabilities 14,830 15,137
-------------- --------------
Total consumer products liabilities 61,851 62,778
Total financial services liabilities 8,295 8,320
-------------- --------------
Total liabilities 70,146 71,098
Total stockholders' equity 27,775 25,077
-------------- --------------
Total liabilities and
stockholders' equity $ 97,921 $ 96,175
============== ==============
Total consumer products debt $ 22,813 $ 22,329
Debt/equity ratio - consumer products 0.82 0.89
Total debt $ 24,884 $ 24,539
Total debt/equity ratio 0.90 0.98
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