Altria Group (MO) said its second-quarter earnings more than doubled as demand for smokeless tobacco ramped up and cigarette prices increased, leading the holding company to once again lift its fiscal 2012 forecast.
The Richmond, Va.-based parent company of Philip Morris USA, the tobacco company responsible for Marlboro cigarettes and smokeless products, raised its full-year earnings outlook on Tuesday excluding one-time items to $2.17 to $2.23.
The forecast, improved from an earlier $2.28 to $2.34, is ahead of average analyst estimates of $2.20 a share in a Thomson Reuters poll. Altria upped the guidance in May citing non-cash benefits related to its roughly 27% stake in SABMiller, one of the world’s top brewers.
Altria reported net income for the three months ended June 30 of $1.2 billion, or 60 cents a share, compared with a year-earlier $444 million, or 21 cents, topping average estimates of 57 cents. The results in 2011 were impacted by a large tax charge.
“Altria delivered excellent financial results for the second quarter and first six months of 2012, reflecting the strength of our diverse business model,” Altria CEO Marty Barrington said in a statement.
Net revenue was $6.49 billion, up 9.6% from $5.9 billion a year ago, beating the Street’s view of $4.48 billion. Smokeable product sales grew slightly to $5.9 billion, while shipments of Marlboro slumped 0.8% and those of other premium cigarettes fell by 8.4%.
Smokeless revenues edged 5.4% higher to $426 million on a 7.6% increase in volumes led by Copenhagen and Skoal chewing tobacco.
Shares of Altria, which are up nearly 18% since January, slumped slightly following the announcement Tuesday morning.