2017 Q2 Form 10-Q Financial Statement

#000076418017000050 Filed on May 02, 2017

View on sec.gov

Income Statement

Concept 2017 Q2 2017 Q1 2016 Q1
Revenue $6.663B $6.083B $6.066B
YoY Change 2.18% 0.28% 4.51%
Cost Of Revenue $1.954B $1.813B $1.874B
YoY Change 1.56% -3.26% 4.28%
Gross Profit $3.114B $2.776B $2.656B
YoY Change 5.31% 4.52% 7.31%
Gross Profit Margin 46.74% 45.64% 43.79%
Selling, General & Admin $559.0M $532.0M $559.0M
YoY Change 2.38% -4.83% -8.36%
% of Gross Profit 17.95% 19.16% 21.05%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $52.00M $52.00M $49.00M
YoY Change 6.12% 6.12% 0.0%
% of Gross Profit 1.67% 1.87% 1.84%
Operating Expenses $559.0M $532.0M $559.0M
YoY Change 2.38% -4.83% -8.36%
Operating Profit $2.528B $2.239B $1.977B
YoY Change 4.9% 13.25% 6.01%
Interest Expense -$37.00M -$149.0M -$94.00M
YoY Change -129.84% 58.51% 25.33%
% of Operating Profit -1.46% -6.65% -4.75%
Other Income/Expense, Net $11.00M $8.000M
YoY Change
Pretax Income $2.910B $2.091B $1.883B
YoY Change 14.84% 11.05% 20.55%
Income Tax $920.0M $689.0M $665.0M
% Of Pretax Income 31.62% 32.95% 35.32%
Net Earnings $1.989B $1.401B $1.217B
YoY Change 20.33% 15.12% 19.55%
Net Earnings / Revenue 29.85% 23.03% 20.06%
Basic Earnings Per Share
Diluted Earnings Per Share $1.032M $722.5K $622.2K
COMMON SHARES
Basic Shares Outstanding 1.932B shares 1.939B shares 1.958B shares
Diluted Shares Outstanding

Balance Sheet

Concept 2017 Q2 2017 Q1 2016 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $2.255B $5.228B $3.815B
YoY Change 175.34% 37.04% 3.84%
Cash & Equivalents $2.255B $5.228B $3.815B
Short-Term Investments
Other Short-Term Assets $238.0M $141.0M $296.0M
YoY Change -52.5% -52.36% 86.16%
Inventory $1.999B $2.122B $2.108B
Prepaid Expenses
Receivables $119.0M $135.0M $104.0M
Other Receivables $0.00 $0.00 $1.175B
Total Short-Term Assets $4.611B $7.626B $7.498B
YoY Change 0.24% 1.71% 3.66%
LONG-TERM ASSETS
Property, Plant & Equipment $1.900B $1.923B $1.955B
YoY Change -3.16% -1.64% -0.86%
Goodwill $5.307B $5.307B $5.285B
YoY Change 0.42% 0.42% 0.0%
Intangibles $12.20B $12.20B $12.02B
YoY Change 1.24% 1.48% -0.17%
Long-Term Investments $18.22B $17.58B $5.743B
YoY Change 210.01% 206.09% -1.83%
Other Assets $505.0M $520.0M $394.0M
YoY Change 26.88% 31.98% -15.81%
Total Long-Term Assets $39.12B $38.55B $26.57B
YoY Change 46.37% 45.11% -1.53%
TOTAL ASSETS
Total Short-Term Assets $4.611B $7.626B $7.498B
Total Long-Term Assets $39.12B $38.55B $26.57B
Total Assets $43.73B $46.18B $34.06B
YoY Change 39.59% 35.56% -0.44%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $194.0M $235.0M $208.0M
YoY Change 0.52% 12.98% -24.09%
Accrued Expenses $4.104B $6.465B $6.705B
YoY Change -2.56% -3.58% 9.68%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due $4.000M
YoY Change -99.6%
Total Short-Term Liabilities $5.582B $8.300B $8.616B
YoY Change 1.27% -3.67% -3.14%
LONG-TERM LIABILITIES
Long-Term Debt $13.89B $13.88B $12.85B
YoY Change 8.18% 8.08% -0.43%
Other Long-Term Liabilities $394.0M $431.0M $417.0M
YoY Change -5.06% 3.36% -19.03%
Total Long-Term Liabilities $14.28B $14.32B $13.26B
YoY Change 7.76% 7.93% -1.14%
TOTAL LIABILITIES
Total Short-Term Liabilities $5.582B $8.300B $8.616B
Total Long-Term Liabilities $14.28B $14.32B $13.26B
Total Liabilities $31.27B $33.87B $31.28B
YoY Change 11.1% 8.3% -1.18%
SHAREHOLDERS EQUITY
Retained Earnings $37.94B $37.12B $27.37B
YoY Change 35.91% 35.65% 4.17%
Common Stock $6.863B $6.844B $6.753B
YoY Change 1.13% 1.35% 0.96%
Preferred Stock
YoY Change
Treasury Stock (at cost) $30.55B $29.50B $28.05B
YoY Change 8.24% 5.16% 2.06%
Treasury Stock Shares 885.2M shares 870.8M shares 849.3M shares
Shareholders Equity $12.42B $12.26B $2.745B
YoY Change
Total Liabilities & Shareholders Equity $43.73B $46.18B $34.06B
YoY Change 39.59% 35.56% -0.44%

Cashflow Statement

Concept 2017 Q2 2017 Q1 2016 Q1
OPERATING ACTIVITIES
Net Income $1.989B $1.401B $1.217B
YoY Change 20.33% 15.12% 19.55%
Depreciation, Depletion And Amortization $52.00M $52.00M $49.00M
YoY Change 6.12% 6.12% 0.0%
Cash From Operating Activities -$727.0M $2.675B $2.718B
YoY Change -55.4% -1.58% 8.81%
INVESTING ACTIVITIES
Capital Expenditures -$58.00M $33.00M $26.00M
YoY Change 13.73% 26.92% -45.83%
Acquisitions
YoY Change
Other Investing Activities $42.00M $199.0M -$4.000M
YoY Change -191.3% -5075.0%
Cash From Investing Activities -$16.00M -$230.0M $34.00M
YoY Change -83.51% -776.47% -65.66%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net $551.0M $168.0M
YoY Change 227.98% -12.5%
Debt Paid & Issued, Net $0.00
YoY Change -100.0%
Cash From Financing Activities -2.240B -$1.776B -$1.306B
YoY Change 76.52% 35.99% -41.8%
NET CHANGE
Cash From Operating Activities -727.0M $2.675B $2.718B
Cash From Investing Activities -16.00M -$230.0M $34.00M
Cash From Financing Activities -2.240B -$1.776B -$1.306B
Net Change In Cash -2.983B $669.0M $1.446B
YoY Change -0.43% -53.73% 309.63%
FREE CASH FLOW
Cash From Operating Activities -$727.0M $2.675B $2.718B
Capital Expenditures -$58.00M $33.00M $26.00M
Free Cash Flow -$669.0M $2.642B $2.692B
YoY Change -57.63% -1.86% 9.88%

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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;text-decoration:underline;">Recent Accounting Guidance Not Yet Adopted:</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The following table provides a description of the recently issued accounting guidance applicable to, but not yet adopted by, Altria Group, Inc.:</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="4" rowspan="1"></td></tr><tr><td style="width:18%;" rowspan="1" colspan="1"></td><td style="width:23%;" rowspan="1" colspan="1"></td><td style="width:21%;" rowspan="1" colspan="1"></td><td style="width:38%;" rowspan="1" colspan="1"></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Standards</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Description</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Effective Date for </font></div><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Public Entity</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Effect on financial statements </font></div></td></tr><tr><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">ASU Nos. 2014-09; 2015-14; 2016-08; 2016-10; 2016-12; 2016-20 </font></div><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-style:italic;">Revenue from Contracts with Customers (Topic 606)</font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance establishes principles for reporting information about the nature, amount, timing, and uncertainty of revenue and cash flows arising from an entity&#8217;s contracts with customers. </font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted only as of annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period.</font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The adoption of this guidance is not expected to have a material impact on the amount or timing of revenue recognized on Altria Group, Inc.&#8217;s financial statements based on current contracts with customers. The guidance will result in expanded footnote disclosures. Altria Group, Inc. plans to retrospectively adopt this guidance by the first quarter of 2018.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">ASU No. 2016-01</font></div><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-style:italic;">Recognition and Measurement of Financial Assets and Financial Liabilities (Subtopic 825-10)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. </font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption of the guidance is not permitted, except for a certain provision of the guidance. </font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The adoption of this guidance is not expected to have a material impact on Altria Group, Inc.&#8217;s consolidated financial statements.</font></div></td></tr><tr><td style="vertical-align:top;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">ASU No. 2016-02</font></div><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-style:italic;">Leases (Topic 842)</font></div></td><td style="vertical-align:top;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance increases transparency and comparability among organizations by requiring entities to recognize lease assets and lease liabilities on the balance sheet and disclose key information about leasing arrangements. </font></div></td><td style="vertical-align:top;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance is effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period. Early adoption is permitted.</font></div></td><td style="vertical-align:top;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Altria Group, Inc. is in the process of evaluating the impact of this guidance on its consolidated financial statements and related disclosures, including identifying and analyzing all contracts that contain a lease. As a lessor, PMCC maintains a portfolio of finance assets, substantially all of which are leveraged leases, the accounting of which will be unchanged under the new guidance and is not expected to change unless there is a contract modification to an existing lease. As a lessee, Altria Group, Inc.&#8217;s various leases under existing guidance are classified as operating leases that are not recorded on the balance sheet but are recorded in the statement of earnings as expense is incurred. Upon adoption of the new guidance, Altria Group, Inc. will be required to record substantially all leases on the balance sheet as a right-of-use asset and a lease liability. The timing of expense recognition and classification in the statement of earnings could change based on the classification of leases as either operating or financing.</font></div></td></tr><tr><td style="vertical-align:top;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">ASU No. 2016-13</font><font style="font-family:inherit;font-size:9pt;font-style:italic;">&#160;Measurement of Credit Losses on Financial Instruments</font><font style="font-family:inherit;font-size:9pt;color:#505050;">&#160;</font><font style="font-family:inherit;font-size:9pt;font-style:italic;">(Topic 326)</font></div><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br clear="none"/></font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance replaces the current incurred loss impairment methodology for recognizing credit losses for financial assets with a methodology that reflects the entity&#8217;s current estimate of all expected credit losses and requires consideration of a broader range of reasonable and supportable information for estimating credit losses. </font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance is effective for annual reporting periods beginning after December 15, 2019, including interim periods within that reporting period. Early adoption is permitted only as of annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period.</font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="padding-top:2px;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Altria Group, Inc. is in the process of evaluating the impact of this guidance on its consolidated financial statements and related disclosures. Altria Group, Inc.&#8217;s financial assets that are within the scope of the new guidance are approximately 2% of Altria Group, Inc.&#8217;s total assets at March 31, 2017.</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="overflow:hidden;height:8px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="overflow:hidden;height:8px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="overflow:hidden;height:8px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="overflow:hidden;height:8px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="overflow:hidden;height:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="overflow:hidden;height:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="overflow:hidden;height:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="overflow:hidden;height:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr></table></div><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="4" rowspan="1"></td></tr><tr><td style="width:18%;" rowspan="1" colspan="1"></td><td style="width:23%;" rowspan="1" colspan="1"></td><td style="width:21%;" rowspan="1" colspan="1"></td><td style="width:38%;" rowspan="1" colspan="1"></td></tr><tr><td style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Standards</font></div></td><td style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Description</font></div></td><td style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Effective Date for </font></div><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Public Entity</font></div></td><td style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;" rowspan="1" colspan="1"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Effect on financial statements </font></div></td></tr><tr><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">ASU No. 2016-15 </font><font style="font-family:inherit;font-size:9pt;font-style:italic;">Classification of Certain Cash Receipts and Cash Payments (Topic 230)</font></div><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br clear="none"/></font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance addresses how eight specific cash flow issues are to be presented and classified in the statement of cash flows. </font></div><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br clear="none"/></font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance is effective for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period.</font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Altria Group, Inc. is in the process of evaluating the impact of this guidance on its consolidated financial statements and related disclosures. </font></div><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br clear="none"/></font></div></td></tr><tr><td style="vertical-align:top;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="padding-top:2px;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">ASU No. 2016-18 </font><font style="font-family:inherit;font-size:9pt;font-style:italic;">Restricted Cash</font></div><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-style:italic;">(Topic 230)</font></div><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br clear="none"/></font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents and amounts generally described as restricted cash and restricted cash equivalents.</font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="padding-top:2px;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance is effective for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period.</font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="padding-top:2px;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Altria Group, Inc. is in the process of evaluating the impact of this guidance on its consolidated financial statements and related disclosures.</font></div><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br clear="none"/></font></div></td></tr><tr><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">ASU No. 2017-07 </font><font style="font-family:inherit;font-size:9pt;font-style:italic;">Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (Topic 715)</font></div><div style="font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br clear="none"/></font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance requires an employer to report the service cost component of net periodic pension cost and net periodic postretirement benefit cost in the same line item or items as other compensation costs arising from services rendered by employees during the period. The other components of net periodic pension cost and net periodic postretirement benefit cost are required to be presented in the statement of earnings separately from the service cost component and outside the subtotal of operating income. Additionally, only the service cost component is eligible for capitalization.</font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The guidance is effective for annual periods beginning after December 15, 2017 and interim periods within that reporting period. Early adoption is permitted only as of the beginning of an annual period for which financial statements have not been issued.</font></div><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br clear="none"/></font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:#cceeff;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;" rowspan="1" colspan="1"><div style="padding-top:2px;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Altria Group, Inc. is in the process of evaluating the impact of this guidance on its consolidated financial statements and related disclosures.</font></div><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br clear="none"/></font></div></td></tr></table></div></div></div>

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