Condensed Consolidating Financial Information (Tables)

6 Months Ended

Jun. 30, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Condensed Consolidating Balance Sheet

Condensed Consolidating Balance Sheets

June 30, 2017

(in millions of dollars)

	Altria Group, Inc.		PM USA		Non- Guarantor Subsidiaries		Total Consolidating Adjustments			Consolidated
Assets
Cash and cash equivalents	$	2,203	$	1	$	51	$	—		$	2,255
Receivables	—		8		111		—			119
Inventories:
Leaf tobacco	—		441		328		—			769
Other raw materials	—		112		66		—			178
Work in process	—		3		431		—			434
Finished product	—		187		431		—			618
	—		743		1,256		—			1,999
Due from Altria Group, Inc. and subsidiaries	17		2,728		1,145		(3,890		)	—
Other current assets	34		106		104		(6		)	238
Total current assets	2,254		3,586		2,667		(3,896		)	4,611
Property, plant and equipment, at cost	—		2,975		1,877		—			4,852
Less accumulated depreciation	—		2,108		844		—			2,952
	—		867		1,033		—			1,900
Goodwill	—		—		5,307		—			5,307
Other intangible assets, net	—		2		12,194		—			12,196
Investment in AB InBev	18,219		—		—		—			18,219
Investment in consolidated subsidiaries	11,839		2,642		—		(14,481		)	—
Finance assets, net	—		—		988		—			988
Due from Altria Group, Inc. and subsidiaries	4,790		—		—		(4,790		)	—
Other assets	20		1,736		127		(1,378		)	505
Total Assets	$	37,122	$	8,833	$	22,316	$	(24,545	)	$	43,726

Condensed Consolidating Balance Sheets (Continued)

June 30, 2017

(in millions of dollars)

	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Liabilities
Accounts payable	$	—		$	64		$	130		$	—		$	194
Accrued liabilities:
Marketing	—			659			104			—			763
Employment costs	15			9			87			—			111
Settlement charges	—			2,216			7			—			2,223
Other	257			509			241			—			1,007
Income taxes	1			—			113			(6		)	108
Dividends payable	1,176			—			—			—			1,176
Due to Altria Group, Inc. and subsidiaries	3,505			327			58			(3,890		)	—
Total current liabilities	4,954			3,784			740			(3,896		)	5,582
Long-term debt	13,887			—			—			—			13,887
Deferred income taxes	5,554			—			4,351			(1,378		)	8,527
Accrued pension costs	203			—			473			—			676
Accrued postretirement health care costs	—			1,431			772			—			2,203
Due to Altria Group, Inc. and subsidiaries	—			—			4,790			(4,790		)	—
Other liabilities	106			151			137			—			394
Total liabilities	24,704			5,366			11,263			(10,064		)	31,269
Contingencies
Redeemable noncontrolling interest	—			—			36			—			36
Stockholders’ Equity
Common stock	935			—			9			(9		)	935
Additional paid-in capital	5,928			3,310			11,855			(15,165		)	5,928
Earnings reinvested in the business	37,939			421			814			(1,235		)	37,939
Accumulated other comprehensive losses	(1,838		)	(264		)	(1,664		)	1,928			(1,838		)
Cost of repurchased stock	(30,546		)	—			—			—			(30,546		)
Total stockholders’ equity attributable to Altria Group, Inc.	12,418			3,467			11,014			(14,481		)	12,418
Noncontrolling interests	—			—			3			—			3
Total stockholders’ equity	12,418			3,467			11,017			(14,481		)	12,421
Total Liabilities and Stockholders’ Equity	$	37,122		$	8,833		$	22,316		$	(24,545	)	$	43,726

Condensed Consolidating Balance Sheets

December 31, 2016

(in millions of dollars)

	Altria Group, Inc.		PM USA		Non- Guarantor Subsidiaries		Total Consolidating Adjustments			Consolidated
Assets
Cash and cash equivalents	$	4,521	$	1	$	47	$	—		$	4,569
Receivables	—		8		143		—			151
Inventories:
Leaf tobacco	—		541		351		—			892
Other raw materials	—		111		53		—			164
Work in process	—		3		509		—			512
Finished product	—		112		371		—			483
	—		767		1,284		—			2,051
Due from Altria Group, Inc. and subsidiaries	—		3,797		1,511		(5,308		)	—
Other current assets	170		118		201		—			489
Total current assets	4,691		4,691		3,186		(5,308		)	7,260
Property, plant and equipment, at cost	—		2,971		1,864		—			4,835
Less accumulated depreciation	—		2,073		804		—			2,877
	—		898		1,060		—			1,958
Goodwill	—		—		5,285		—			5,285
Other intangible assets, net	—		2		12,034		—			12,036
Investment in AB InBev	17,852		—		—		—			17,852
Investment in consolidated subsidiaries	11,636		2,632		—		(14,268		)	—
Finance assets, net	—		—		1,028		—			1,028
Due from Altria Group, Inc. and subsidiaries	4,790		—		—		(4,790		)	—
Other assets	18		1,748		131		(1,384		)	513
Total Assets	$	38,987	$	9,971	$	22,724	$	(25,750	)	$	45,932

Condensed Consolidating Balance Sheets (Continued)

December 31, 2016

(in millions of dollars)

	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Liabilities
Accounts payable	$	1		$	92		$	332		$	—		$	425
Accrued liabilities:
Marketing	—			619			128			—			747
Employment costs	104			14			171			—			289
Settlement charges	—			3,696			5			—			3,701
Other	261			438			326			—			1,025
Dividends payable	1,188			—			—			—			1,188
Due to Altria Group, Inc. and subsidiaries	5,030			237			41			(5,308		)	—
Total current liabilities	6,584			5,096			1,003			(5,308		)	7,375
Long-term debt	13,881			—			—			—			13,881
Deferred income taxes	5,424			—			4,376			(1,384		)	8,416
Accrued pension costs	207			—			598			—			805
Accrued postretirement health care costs	—			1,453			764			—			2,217
Due to Altria Group, Inc. and subsidiaries	—			—			4,790			(4,790		)	—
Other liabilities	121			146			160			—			427
Total liabilities	26,217			6,695			11,691			(11,482		)	33,121
Contingencies
Redeemable noncontrolling interest	—			—			38			—			38
Stockholders’ Equity
Common stock	935			—			9			(9		)	935
Additional paid-in capital	5,893			3,310			11,585			(14,895		)	5,893
Earnings reinvested in the business	36,906			237			1,118			(1,355		)	36,906
Accumulated other comprehensive losses	(2,052		)	(271		)	(1,720		)	1,991			(2,052		)
Cost of repurchased stock	(28,912		)	—			—			—			(28,912		)
Total stockholders’ equity attributable to Altria Group, Inc.	12,770			3,276			10,992			(14,268		)	12,770
Noncontrolling interests	—			—			3			—			3
Total stockholders’ equity	12,770			3,276			10,995			(14,268		)	12,773
Total Liabilities and Stockholders’ Equity	$	38,987		$	9,971		$	22,724		$	(25,750	)	$	45,932

Condensed Consolidating Statements of Earnings and Comprehensive Earnings

Condensed Consolidating Statements of Earnings and Comprehensive Earnings

For the Six Months Ended June 30, 2017

(in millions of dollars)

	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Net revenues	$	—		$	10,984		$	1,780		$	(18	)	$	12,746
Cost of sales	—			3,216			561			(18		)	3,759
Excise taxes on products	—			2,982			107			—			3,089
Gross profit	—			4,786			1,112			—			5,898
Marketing, administration and research costs	80			791			225			—			1,096
Asset impairment and exit costs	—			—			16			—			16
Operating (expense) income	(80		)	3,995			871			—			4,786
Interest and other debt expense, net	253			(6		)	109			—			356
Earnings from equity investment in AB InBev	(163		)	—			—			—			(163		)
Gain on AB InBev/SABMiller business combination	(408		)	—			—			—			(408		)
Earnings before income taxes and equity earnings of subsidiaries	238			4,001			762			—			5,001
(Benefit) provision for income taxes	(40		)	1,397			252			—			1,609
Equity earnings of subsidiaries	3,112			152			—			(3,264		)	—
Net earnings	3,390			2,756			510			(3,264		)	3,392
Net earnings attributable to noncontrolling interests	—			—			(2		)	—			(2		)
Net earnings attributable to Altria Group, Inc.	$	3,390		$	2,756		$	508		$	(3,264	)	$	3,390
Net earnings	$	3,390		$	2,756		$	510		$	(3,264	)	$	3,392
Other comprehensive earnings, net of deferred income taxes	214			7			56			(63		)	214
Comprehensive earnings	3,604			2,763			566			(3,327		)	3,606
Comprehensive earnings attributable to noncontrolling interests	—			—			(2		)	—			(2		)
Comprehensive earnings attributable to Altria Group, Inc.	$	3,604		$	2,763		$	564		$	(3,327	)	$	3,604

Condensed Consolidating Statements of Earnings and Comprehensive Earnings

For the Six Months Ended June 30, 2016

(in millions of dollars)

	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Net revenues	$	—		$	10,910		$	1,696		$	(19	)	$	12,587
Cost of sales	—			3,317			500			(19		)	3,798
Excise taxes on products	—			3,069			107			—			3,176
Gross profit	—			4,524			1,089			—			5,613
Marketing, administration and research costs	73			828			204			—			1,105
Asset impairment and exit costs	5			95			21			—			121
Operating (expense) income	(78		)	3,601			864			—			4,387
Interest and other debt expense, net	264			17			111			—			392
Earnings from equity investment in SABMiller	(265		)	—			—			—			(265		)
Gain on AB InBev/SABMiller business combination	(157		)	—			—			—			(157		)
Earnings before income taxes and equity earnings of subsidiaries	80			3,584			753			—			4,417
(Benefit) provision for income taxes	(37		)	1,316			266			—			1,545
Equity earnings of subsidiaries	2,753			140			—			(2,893		)	—
Net earnings	2,870			2,408			487			(2,893		)	2,872
Net earnings attributable to noncontrolling interests	—			—			(2		)	—			(2		)
Net earnings attributable to Altria Group, Inc.	$	2,870		$	2,408		$	485		$	(2,893	)	$	2,870
Net earnings	$	2,870		$	2,408		$	487		$	(2,893	)	$	2,872
Other comprehensive losses, net of deferred income taxes	(60		)	(15		)	(129		)	144			(60		)
Comprehensive earnings	2,810			2,393			358			(2,749		)	2,812
Comprehensive earnings attributable to noncontrolling interests	—			—			(2		)	—			(2		)
Comprehensive earnings attributable to Altria Group, Inc.	$	2,810		$	2,393		$	356		$	(2,749	)	$	2,810

Condensed Consolidating Statements of Earnings and Comprehensive Earnings

For the Three Months Ended June 30, 2017

(in millions of dollars)

	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Net revenues	$	—		$	5,713		$	960		$	(10	)	$	6,663
Cost of sales	—			1,678			281			(10		)	1,949
Excise taxes on products	—			1,536			59			—			1,595
Gross profit	—			2,499			620			—			3,119
Marketing, administration and research costs	40			413			115			—			568
Asset impairment and exit costs	—			—			12			—			12
Operating (expense) income	(40		)	2,086			493			—			2,539
Interest and other debt expense, net	130			(6		)	53			—			177
Earnings from equity investment in AB InBev	(140		)	—			—			—			(140		)
Gain on AB InBev/SABMiller business combination	(408		)	—			—			—			(408		)
Earnings before income taxes and equity earnings of subsidiaries	378			2,092			440			—			2,910
Provision for income taxes	32			734			154			—			920
Equity earnings of subsidiaries	1,643			80			—			(1,723		)	—
Net earnings	1,989			1,438			286			(1,723		)	1,990
Net earnings attributable to noncontrolling interests	—			—			(1		)	—			(1		)
Net earnings attributable to Altria Group, Inc.	$	1,989		$	1,438		$	285		$	(1,723	)	$	1,989
Net earnings	$	1,989		$	1,438		$	286		$	(1,723	)	$	1,990
Other comprehensive earnings, net of deferred income taxes	374			4			28			(32		)	374
Comprehensive earnings	2,363			1,442			314			(1,755		)	2,364
Comprehensive earnings attributable to noncontrolling interests	—			—			(1		)	—			(1		)
Comprehensive earnings attributable to Altria Group, Inc.	$	2,363		$	1,442		$	313		$	(1,755	)	$	2,363

Condensed Consolidating Statements of Earnings and Comprehensive Earnings

For the Three Months Ended June 30, 2016

(in millions of dollars)

	Altria Group, Inc.			PM USA		Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Net revenues	$	—		$	5,645	$	886		$	(10	)	$	6,521
Cost of sales	—			1,675		259			(10		)	1,924
Excise taxes on products	—			1,582		58			—			1,640
Gross profit	—			2,388		569			—			2,957
Marketing, administration and research costs	37			413		96			—			546
Asset impairment and exit costs	—			1		—			—			1
Operating (expense) income	(37		)	1,974		473			—			2,410
Interest and other debt expense, net	135			2		55			—			192
Earnings from equity investment in SABMiller	(199		)	—		—			—			(199		)
Gain on AB InBev/SABMiller business combination	(117		)	—		—			—			(117		)
Earnings before income taxes and equity earnings of subsidiaries	144			1,972		418			—			2,534
Provision for income taxes	12			713		155			—			880
Equity earnings of subsidiaries	1,521			80		—			(1,601		)	—
Net earnings	1,653			1,339		263			(1,601		)	1,654
Net earnings attributable to noncontrolling interests	—			—		(1		)	—			(1		)
Net earnings attributable to Altria Group, Inc.	$	1,653		$	1,339	$	262		$	(1,601	)	$	1,653
Net earnings	$	1,653		$	1,339	$	263		$	(1,601	)	$	1,654
Other comprehensive (losses) earnings, net of deferred income taxes	(13		)	2		27			(29		)	(13		)
Comprehensive earnings	1,640			1,341		290			(1,630		)	1,641
Comprehensive earnings attributable to noncontrolling interests	—			—		(1		)	—			(1		)
Comprehensive earnings attributable to Altria Group, Inc.	$	1,640		$	1,341	$	289		$	(1,630	)	$	1,640

Condensed Consolidating Statements of Cash Flows

Condensed Consolidating Statements of Cash Flows

For the Six Months Ended June 30, 2017

(in millions of dollars)

	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Cash Provided by Operating Activities
Net cash provided by operating activities	$	3,508		$	1,427		$	397		$	(3,384	)	$	1,948
Cash Provided by (Used in) Investing Activities
Capital expenditures	—			(13		)	(78		)	—			(91		)
Proceeds from finance assets	—			—			45			—			45
Other	(4		)	—			(196		)	—			(200		)
Net cash used in investing activities	(4		)	(13		)	(229		)	—			(246		)
Cash Provided by (Used in) Financing Activities
Repurchases of common stock	(1,600		)	—			—			—			(1,600		)
Dividends paid on common stock	(2,369		)	—			—			—			(2,369		)
Changes in amounts due to/from Altria Group, Inc. and subsidiaries	(1,813		)	1,158			655			—			—
Cash dividends paid to parent	—			(2,572		)	(812		)	3,384			—
Other	(40		)	—			(7		)	—			(47		)
Net cash used in financing activities	(5,822		)	(1,414		)	(164		)	3,384			(4,016		)
Cash and cash equivalents:
(Decrease) increase	(2,318		)	—			4			—			(2,314		)
Balance at beginning of period	4,521			1			47			—			4,569
Balance at end of period	$	2,203		$	1		$	51		$	—		$	2,255

Condensed Consolidating Statements of Cash Flows

For the Six Months Ended June 30, 2016

(in millions of dollars)

	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Cash Provided by Operating Activities
Net cash provided by operating activities	$	2,853		$	998		$	237		$	(3,000	)	$	1,088
Cash Provided by (Used in) Investing Activities
Capital expenditures	—			(14		)	(63		)	—			(77		)
Proceeds from finance assets	—			—			56			—			56
Other	—			—			(42		)	—			(42		)
Net cash used in investing activities	—			(14		)	(49		)	—			(63		)
Cash Provided by (Used in) Financing Activities
Repurchases of common stock	(341		)	—			—			—			(341		)
Dividends paid on common stock	(2,215		)	—			—			—			(2,215		)
Changes in amounts due to/from Altria Group, Inc. and subsidiaries	(1,833		)	1,581			252			—			—
Cash dividends paid to parent	—			(2,564		)	(436		)	3,000			—
Other	(11		)	—			(8		)	—			(19		)
Net cash used in financing activities	(4,400		)	(983		)	(192		)	3,000			(2,575		)
Cash and cash equivalents:
(Decrease) increase	(1,547		)	1			(4		)	—			(1,550		)
Balance at beginning of period	2,313			—			56			—			2,369
Balance at end of period	$	766		$	1		$	52		$	—		$	819