Condensed Consolidating Financial Information (Tables)

3 Months Ended

Mar. 31, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Condensed Consolidating Balance Sheets

March 31, 2018

(in millions of dollars)



	Altria Group, Inc.		PM USA		Non- Guarantor Subsidiaries		Total Consolidating Adjustments			Consolidated
Assets
Cash and cash equivalents	$	2,152	$	1	$	38	$	—		$	2,191
Receivables	—		11		122		—			133
Inventories:
Leaf tobacco	—		543		377		—			920
Other raw materials	—		112		72		—			184
Work in process	—		7		540		—			547
Finished product	—		174		432		—			606
	—		836		1,421		—			2,257
Due from Altria Group, Inc. and subsidiaries	—		4,874		676		(5,550		)	—
Other current assets	20		217		83		(77		)	243
Total current assets	2,172		5,939		2,340		(5,627		)	4,824
Property, plant and equipment, at cost	—		2,924		1,955		—			4,879
Less accumulated depreciation	—		2,101		887		—			2,988
	—		823		1,068		—			1,891
Goodwill	—		—		5,307		—			5,307
Other intangible assets, net	—		2		12,398		—			12,400
Investment in AB InBev	18,199		—		—		—			18,199
Investment in consolidated subsidiaries	14,018		2,825		—		(16,843		)	—
Finance assets, net	—		—		854		—			854
Due from Altria Group, Inc. and subsidiaries	4,790		—		—		(4,790		)	—
Other assets	56		689		154		(475		)	424
Total Assets	$	39,235	$	10,278	$	22,121	$	(27,735	)	$	43,899

Condensed Consolidating Balance Sheets (Continued)

March 31, 2018

(in millions of dollars)



	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Liabilities
Current portion of long-term debt	$	864		$	—		$	—		$	—		$	864
Accounts payable	5			78			120			—			203
Accrued liabilities:
Marketing	—			613			94			—			707
Employment costs	12			11			45			—			68
Settlement charges	—			3,451			7			—			3,458
Other	267			313			342			(77		)	845
Dividends payable	1,330			—			—			—			1,330
Due to Altria Group, Inc. and subsidiaries	5,128			342			80			(5,550		)	—
Total current liabilities	7,606			4,808			688			(5,627		)	7,475
Long-term debt	13,033			—			—			—			13,033
Deferred income taxes	2,854			—			2,913			(475		)	5,292
Accrued pension costs	202			—			180			—			382
Accrued postretirement health care costs	—			1,214			773			—			1,987
Due to Altria Group, Inc. and subsidiaries	—			—			4,790			(4,790		)	—
Other liabilities	146			43			107			—			296
Total liabilities	23,841			6,065			9,451			(10,892		)	28,465
Contingencies
Redeemable noncontrolling interest	—			—			37			—			37
Stockholders’ Equity
Common stock	935			—			9			(9		)	935
Additional paid-in capital	5,938			3,310			12,045			(15,355		)	5,938
Earnings reinvested in the business	42,816			1,167			2,043			(3,210		)	42,816
Accumulated other comprehensive losses	(1,927		)	(264		)	(1,467		)	1,731			(1,927		)
Cost of repurchased stock	(32,368		)	—			—			—			(32,368		)
Total stockholders’ equity attributable to Altria Group, Inc.	15,394			4,213			12,630			(16,843		)	15,394
Noncontrolling interests	—			—			3			—			3
Total stockholders’ equity	15,394			4,213			12,633			(16,843		)	15,397
Total Liabilities and Stockholders’ Equity	$	39,235		$	10,278		$	22,121		$	(27,735	)	$	43,899

Condensed Consolidating Balance Sheets

December 31, 2017

(in millions of dollars)



	Altria Group, Inc.		PM USA		Non- Guarantor Subsidiaries		Total Consolidating Adjustments			Consolidated
Assets
Cash and cash equivalents	$	1,203	$	1	$	49	$	—		$	1,253
Receivables	1		10		131		—			142
Inventories:
Leaf tobacco	—		579		362		—			941
Other raw materials	—		111		59		—			170
Work in process	—		5		555		—			560
Finished product	—		128		426		—			554
	—		823		1,402		—			2,225
Due from Altria Group, Inc. and subsidiaries	2		2,413		1,022		(3,437		)	—
Income taxes	—		542		17		(98		)	461
Other current assets	11		147		105		—			263
Total current assets	1,217		3,936		2,726		(3,535		)	4,344
Property, plant and equipment, at cost	—		2,930		1,949		—			4,879
Less accumulated depreciation	—		2,086		879		—			2,965
	—		844		1,070		—			1,914
Goodwill	—		—		5,307		—			5,307
Other intangible assets, net	—		2		12,398		—			12,400
Investment in AB InBev	17,952		—		—		—			17,952
Investment in consolidated subsidiaries	13,111		2,818		—		(15,929		)	—
Finance assets, net	—		—		899		—			899
Due from Altria Group, Inc. and subsidiaries	4,790		—		—		(4,790		)	—
Other assets	34		671		157		(476		)	386
Total Assets	$	37,104	$	8,271	$	22,557	$	(24,730	)	$	43,202

Condensed Consolidating Balance Sheets (Continued)

December 31, 2017

(in millions of dollars)



	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Liabilities
Current portion of long-term debt	$	864		$	—		$	—		$	—		$	864
Accounts payable	2			91			281			—			374
Accrued liabilities:
Marketing	—			578			117			—			695
Employment costs	21			14			153			—			188
Settlement charges	—			2,437			5			—			2,442
Other	389			433			247			(98		)	971
Dividends payable	1,258			—			—			—			1,258
Due to Altria Group, Inc. and subsidiaries	3,040			317			80			(3,437		)	—
Total current liabilities	5,574			3,870			883			(3,535		)	6,792
Long-term debt	13,030			—			—			—			13,030
Deferred income taxes	2,809			—			2,914			(476		)	5,247
Accrued pension costs	206			—			239			—			445
Accrued postretirement health care costs	—			1,214			773			—			1,987
Due to Altria Group, Inc. and subsidiaries	—			—			4,790			(4,790		)	—
Other liabilities	108			49			126			—			283
Total liabilities	21,727			5,133			9,725			(8,801		)	27,784
Contingencies
Redeemable noncontrolling interest	—			—			38			—			38
Stockholders’ Equity
Common stock	935			—			9			(9		)	935
Additional paid-in capital	5,952			3,310			12,045			(15,355		)	5,952
Earnings reinvested in the business	42,251			96			2,243			(2,339		)	42,251
Accumulated other comprehensive losses	(1,897		)	(268		)	(1,506		)	1,774			(1,897		)
Cost of repurchased stock	(31,864		)	—			—			—			(31,864		)
Total stockholders’ equity attributable to Altria Group, Inc.	15,377			3,138			12,791			(15,929		)	15,377
Noncontrolling interests	—			—			3			—			3
Total stockholders’ equity	15,377			3,138			12,794			(15,929		)	15,380
Total Liabilities and Stockholders’ Equity	$	37,104		$	8,271		$	22,557		$	(24,730	)	$	43,202

Condensed Consolidating Statements of Earnings and Comprehensive Earnings

For the Three Months Ended March 31, 2018

(in millions of dollars)



	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Net revenues	$	—		$	5,214		$	904		$	(10	)	$	6,108
Cost of sales	—			1,487			257			(10		)	1,734
Excise taxes on products	—			1,383			55			—			1,438
Gross profit	—			2,344			592			—			2,936
Marketing, administration and research costs	38			449			131			—			618
Asset impairment and exit costs	—			—			2			—			2
Operating (expense) income	(38		)	1,895			459			—			2,316
Interest and other debt expense (income), net	122			(9		)	53			—			166
Net periodic benefit cost (income), excluding service cost	1			(6		)	(2		)	—			(7		)
Earnings from equity investment in AB InBev	(342		)	—			—			—			(342		)
Loss on AB InBev/SABMiller business combination	33			—			—			—			33
Earnings before income taxes and equity earnings of subsidiaries	148			1,910			408			—			2,466
(Benefit) provision for income taxes	(13		)	482			102			—			571
Equity earnings of subsidiaries	1,733			89			—			(1,822		)	—
Net earnings	1,894			1,517			306			(1,822		)	1,895
Net earnings attributable to noncontrolling interests	—			—			(1		)	—			(1		)
Net earnings attributable to Altria Group, Inc.	$	1,894		$	1,517		$	305		$	(1,822	)	$	1,894


Net earnings	$	1,894		$	1,517		$	306		$	(1,822	)	$	1,895
Other comprehensive (losses) earnings, net of deferred income taxes	(30		)	4			39			(43		)	(30		)
Comprehensive earnings	1,864			1,521			345			(1,865		)	1,865
Comprehensive earnings attributable to noncontrolling interests	—			—			(1		)	—			(1		)
Comprehensive earnings attributable to Altria Group, Inc.	$	1,864		$	1,521		$	344		$	(1,865	)	$	1,864

Condensed Consolidating Statements of Earnings and Comprehensive Earnings

For the Three Months Ended March 31, 2017

(in millions of dollars)



	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Net revenues	$	—		$	5,271		$	820		$	(8	)	$	6,083
Cost of sales	—			1,539			282			(8		)	1,813
Excise taxes on products	—			1,446			48			—			1,494
Gross profit	—			2,286			490			—			2,776
Marketing, administration and research costs	40			382			111			—			533
Asset impairment and exit costs	—			—			4			—			4
Operating (expense) income	(40		)	1,904			375			—			2,239
Interest and other debt expense, net	123			—			56			—			179
Net periodic benefit income, excluding service cost	—			(5		)	(3		)	—			(8		)
Earnings from equity investment in AB InBev	(23		)	—			—			—			(23		)
(Loss) earnings before income taxes and equity earnings of subsidiaries	(140		)	1,909			322			—			2,091
(Benefit) provision for income taxes	(72		)	663			98			—			689
Equity earnings of subsidiaries	1,469			72			—			(1,541		)	—
Net earnings	1,401			1,318			224			(1,541		)	1,402
Net earnings attributable to noncontrolling interests	—			—			(1		)	—			(1		)
Net earnings attributable to Altria Group, Inc.	$	1,401		$	1,318		$	223		$	(1,541	)	$	1,401


Net earnings	$	1,401		$	1,318		$	224		$	(1,541	)	$	1,402
Other comprehensive (losses) earnings, net of deferred income taxes	(160		)	3			28			(31		)	(160		)
Comprehensive earnings	1,241			1,321			252			(1,572		)	1,242
Comprehensive earnings attributable to noncontrolling interests	—			—			(1		)	—			(1		)
Comprehensive earnings attributable to Altria Group, Inc.	$	1,241		$	1,321		$	251		$	(1,572	)	$	1,241

Condensed Consolidating Statements of Cash Flows

For the Three Months Ended March 31, 2018

(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	$	648		$	2,923		$	189		$	(951	)	$	2,809
Cash Provided by (Used in) Investing Activities
Capital expenditures	—			(1		)	(33		)	—			(34		)
Other	—			—			(7		)	—			(7		)
Cash used in investing activities	—			(1		)	(40		)	—			(41		)
Cash Provided by (Used in) Financing Activities
Repurchases of common stock	(513		)	—			—			—			(513		)
Dividends paid on common stock	(1,257		)	—			—			—			(1,257		)
Changes in amounts due to/from Altria Group, Inc. and subsidiaries	2,091			(2,439		)	348			—			—
Cash dividends paid to parent	—			(446		)	(505		)	951			—
Other	(20		)	—			(3		)	—			(23		)
Net cash provided by (used in) financing activities	301			(2,885		)	(160		)	951			(1,793		)
Cash, cash equivalents and restricted cash ⁽¹⁾:
Increase (decrease)	949			37			(11		)	—			975
Balance at beginning of period	1,203			62			49			—			1,314
Balance at end of period	$	2,152		$	99		$	38		$	—		$	2,289

⁽¹⁾ Restricted cash consisted of cash deposits collateralizing various forms of security posted by PM USA to obtain stays of judgments pending appeals. See Note 10. Contingencies.

Condensed Consolidating Statements of Cash Flows

For the Three Months Ended March 31, 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	$	1,469		$	3,017		$	14		$	(1,825	)	$	2,675
Cash Provided by (Used in) Investing Activities
Capital expenditures	—			(8		)	(25		)	—			(33		)
Proceeds from finance assets	—			—			2			—			2
Other	—			—			(199		)	—			(199		)
Net cash used in investing activities	—			(8		)	(222		)	—			(230		)
Cash Provided by (Used in) Financing Activities
Repurchases of common stock	(551		)	—			—			—			(551		)
Dividends paid on common stock	(1,187		)	—			—			—			(1,187		)
Changes in amounts due to/from Altria Group, Inc. and subsidiaries	952			(1,675		)	723			—			—
Cash dividends paid to parent	—			(1,325		)	(500		)	1,825			—
Other	(34		)	—			(4		)	—			(38		)
Net cash (used in) provided by financing activities	(820		)	(3,000		)	219			1,825			(1,776		)
Cash, cash equivalents and restricted cash ⁽¹⁾:
Increase	649			9			11			—			669
Balance at beginning of period	4,521			83			47			—			4,651
Balance at end of period	$	5,170		$	92		$	58		$	—		$	5,320

⁽¹⁾ Restricted cash consisted of cash deposits collateralizing various forms of security posted by PM USA to obtain stays of judgments pending appeals. See Note 10. Contingencies.