Asset Impairment, Exit and Implementation Costs:

Pre-tax asset impairment, exit and implementation costs consisted of the following:



	For the Nine Months Ended September 30, 2017						For the Nine Months Ended September 30, 2016
	Asset Impairment and Exit Costs		Implementation Costs		Total		Asset Impairment and Exit Costs ⁽¹⁾		Implementation Costs		Total
	(in millions)
Smokeable products	$	2	$	17	$	19	$	99	$	6	$	105
Smokeless products	22		30		52		13		1		14
All other	—		—		—		6		—		6
General corporate	—		—		—		5		—		5
Total	$	24	$	47	$	71	$	123	$	7	$	130

⁽¹⁾ Includes termination and curtailment costs of $20 million. See Note 3. Benefit Plans.



	For the Three Months Ended September 30, 2017						For the Three Months Ended September 30, 2016
	Asset Impairment and Exit Costs		Implementation Costs		Total		Asset Impairment and Exit Costs		Implementation Costs		Total
	(in millions)
Smokeable products	$	—	$	5	$	5	$	1	$	3	$	4
Smokeless products	8		2		10		—		1		1
All other	—		—		—		1		—		1
Total	$	8	$	7	$	15	$	2	$	4	$	6

The movement in the restructuring liabilities (excluding termination and curtailment costs), substantially all of which are severance liabilities, was as follows:



	For the Nine Months Ended September 30, 2017
	(in millions)
Balances at December 31, 2016	$	79
Charges	17
Cash spent	(54		)
Balances at September 30, 2017	$	42

The pre-tax asset impairment, exit and implementation costs shown above for 2017 and 2016 related to the facilities consolidation and productivity initiative, respectively, are discussed below.

Facilities Consolidation

In October 2016, Altria Group, Inc. announced the consolidation of certain of its operating companies’ manufacturing facilities to streamline operations and achieve greater efficiencies. Middleton will transfer its Limerick, Pennsylvania operations to the Manufacturing Center site in Richmond, Virginia (“Richmond Manufacturing Center”). USSTC is in the process of transferring its Franklin Park, Illinois operations to its Nashville, Tennessee facility and the Richmond Manufacturing Center. Separation benefits are being paid to non-relocating employees. The consolidation is expected to be completed by the first quarter of 2018.

As a result of the consolidation, Altria Group, Inc. expects to record total pre-tax charges of approximately $150 million, or $0.05 per share. Of this amount, during 2016, Altria Group, Inc. incurred pre-tax charges of $71 million, or approximately $0.03 per share, and recorded $71 million during the first nine months of 2017. The total estimated charges relate primarily to accelerated depreciation and asset impairment ($55 million), employee separation costs ($45 million) and other exit and implementation costs ($50 million). Approximately $90 million of the total pre-tax charges are expected to result in cash expenditures.

For the nine and three months ended September 30, 2017, Altria Group, Inc. incurred pre-tax asset impairment, exit and implementation costs of $71 million and $15 million, respectively. The pre-tax implementation costs were included in cost of sales in Altria Group, Inc.’s condensed consolidated statements of earnings. Total pre-tax charges incurred since the inception of the consolidation through September 30, 2017 were $142 million.

Cash payments related to the consolidation of $46 million were made during the nine months ended September 30, 2017, for total cash payments of $51 million since inception.

Productivity Initiative

In January 2016, Altria Group, Inc. announced a productivity initiative designed to maintain its operating companies’ leadership and cost competitiveness. The initiative reduces spending on certain selling, general and administrative infrastructure and implements a leaner organizational structure. As a result of the initiative, for the nine and three months ended September 30, 2016, Altria Group, Inc. incurred pre-tax asset impairment, exit and implementation costs of $130 million and $6 million, respectively. At December 31, 2016, total pre-tax charges related to this initiative were substantially completed.

Cash payments related to the initiative of $31 million were made during the nine months ended September 30, 2017, for total cash payments of $105 million since inception.