Condensed Consolidating Financial Information (Tables)

3 Months Ended

Mar. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Condensed Consolidating Balance Sheets

March 31, 2020

(in millions of dollars)



	Altria Group, Inc.		PM USA		Non- Guarantor Subsidiaries		Total Consolidating Adjustments			Consolidated
Assets
Cash and cash equivalents	$	5,548	$	1	$	67	$	—		$	5,616
Receivables	—		17		130		—			147
Inventories:
Leaf tobacco	—		508		387		—			895
Other raw materials	—		123		70		—			193
Work in process	—		6		461		—			467
Finished product	—		87		364		—			451
	—		724		1,282		—			2,006
Due from Altria Group, Inc. and subsidiaries	91		5,660		1,361		(7,112		)	—
Other current assets	301		23		68		(226		)	166
Total current assets	5,940		6,425		2,908		(7,338		)	7,935
Property, plant and equipment, at cost	—		2,970		2,133		—			5,103
Less accumulated depreciation	—		2,186		920		—			3,106
	—		784		1,213		—			1,997
Goodwill	—		—		5,177		—			5,177
Other intangible assets, net	—		2		12,666		—			12,668
Investments in equity securities	18,453		—		5,408		—			23,861
Investment in consolidated subsidiaries	18,905		2,867		—		(21,772		)	—
Due from Altria Group, Inc. and subsidiaries	4,790		—		—		(4,790		)	—
Other assets	71		950		567		(608		)	980
Total Assets	$	48,159	$	11,028	$	27,939	$	(34,508	)	$	52,618

Condensed Consolidating Balance Sheets (Continued)

March 31, 2020

(in millions of dollars)



	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Liabilities
Short-term borrowings	$	3,000		$	—		$	—		$	—		$	3,000
Accounts payable	1			136			141			—			278
Accrued liabilities:
Marketing	—			391			76			—			467
Settlement charges	—			4,410			9			—			4,419
Other	312			343			377			—			1,032
Income taxes	6			508			105			(226		)	393
Dividends payable	1,565			—			—			—			1,565
Due to Altria Group, Inc. and subsidiaries	6,278			587			247			(7,112		)	—
Total current liabilities	11,162			6,375			955			(7,338		)	11,154
Long-term debt	26,971			—			—			—			26,971
Deferred income taxes	3,228			—			2,571			(608		)	5,191
Accrued pension costs	196			—			231			—			427
Accrued postretirement health care costs	—			1,076			722			—			1,798
Due to Altria Group, Inc. and subsidiaries	—			—			4,790			(4,790		)	—
Other liabilities	59			90			253			—			402
Total liabilities	41,616			7,541			9,522			(12,736		)	45,943
Contingencies
Redeemable noncontrolling interest	—			—			38			—			38
Stockholders’ Equity
Common stock	935			—			9			(9		)	935
Additional paid-in capital	5,959			3,310			27,566			(30,876		)	5,959
Earnings reinvested in the business	36,528			393			(7,441		)	7,048			36,528
Accumulated other comprehensive losses	(2,533		)	(216		)	(1,849		)	2,065			(2,533		)
Cost of repurchased stock	(34,346		)	—			—			—			(34,346		)
Total stockholders’ equity attributable to Altria Group, Inc.	6,543			3,487			18,285			(21,772		)	6,543
Noncontrolling interests	—			—			94			—			94
Total stockholders’ equity	6,543			3,487			18,379			(21,772		)	6,637
Total Liabilities and Stockholders’ Equity	$	48,159		$	11,028		$	27,939		$	(34,508	)	$	52,618

Condensed Consolidating Balance Sheets

December 31, 2019

(in millions of dollars)



	Altria Group, Inc.		PM USA		Non- Guarantor Subsidiaries		Total Consolidating Adjustments			Consolidated
Assets
Cash and cash equivalents	$	2,022	$	—	$	95	$	—		$	2,117
Receivables	—		30		122		—			152
Inventories:
Leaf tobacco	—		494		380		—			874
Other raw materials	—		120		72		—			192
Work in process	—		4		692		—			696
Finished product	—		119		412		—			531
	—		737		1,556		—			2,293
Due from Altria Group, Inc. and subsidiaries	88		4,005		1,359		(5,452		)	—
Other current assets	133		64		114		(49		)	262
Total current assets	2,243		4,836		3,246		(5,501		)	4,824
Property, plant and equipment, at cost	—		2,956		2,118		—			5,074
Less accumulated depreciation	—		2,166		909		—			3,075
	—		790		1,209		—			1,999
Goodwill	—		—		5,177		—			5,177
Other intangible assets, net	—		2		12,685		—			12,687
Investments in equity securities	18,071		—		5,510		—			23,581
Investment in consolidated subsidiaries	19,312		2,831		—		(22,143		)	—
Due from Altria Group, Inc. and subsidiaries	4,790		—		—		(4,790		)	—
Other assets	58		951		603		(609		)	1,003
Total Assets	$	44,474	$	9,410	$	28,430	$	(33,043	)	$	49,271

Condensed Consolidating Balance Sheets (Continued)

December 31, 2019

(in millions of dollars)



	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Liabilities
Current portion of long-term debt	$	1,000		$	—		$	—		$	—		$	1,000
Accounts payable	—			146			179			—			325
Accrued liabilities:
Marketing	—			320			73			—			393
Settlement charges	—			3,340			6			—			3,346
Other	570			482			481			—			1,533
Income taxes	6			—			55			(49		)	12
Dividends payable	1,565			—			—			—			1,565
Due to Altria Group, Inc. and subsidiaries	4,693			514			245			(5,452		)	—
Total current liabilities	7,834			4,802			1,039			(5,501		)	8,174
Long-term debt	27,042			—			—			—			27,042
Deferred income taxes	3,099			—			2,593			(609		)	5,083
Accrued pension costs	197			—			276			—			473
Accrued postretirement health care costs	—			1,078			719			—			1,797
Due to Altria Group, Inc. and subsidiaries	—			—			4,790			(4,790		)	—
Other liabilities	80			87			178			—			345
Total liabilities	38,252			5,967			9,595			(10,900		)	42,914
Contingencies
Redeemable noncontrolling interest	—			—			38			—			38
Stockholders’ Equity
Common stock	935			—			9			(9		)	935
Additional paid-in capital	5,970			3,310			27,565			(30,875		)	5,970
Earnings reinvested in the business	36,539			352			(6,997		)	6,645			36,539
Accumulated other comprehensive losses	(2,864		)	(219		)	(1,877		)	2,096			(2,864		)
Cost of repurchased stock	(34,358		)	—			—			—			(34,358		)
Total stockholders’ equity attributable to Altria Group, Inc.	6,222			3,443			18,700			(22,143		)	6,222
Noncontrolling interests	—			—			97			—			97
Total stockholders’ equity	6,222			3,443			18,797			(22,143		)	6,319
Total Liabilities and Stockholders’ Equity	$	44,474		$	9,410		$	28,430		$	(33,043	)	$	49,271

Condensed Consolidating Statements of Earnings and Comprehensive Earnings

For the Three Months Ended March 31, 2020

(in millions of dollars)



	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Net revenues	$	—		$	5,359		$	1,008		$	(8	)	$	6,359
Cost of sales	—			1,532			649			(8		)	2,173
Excise taxes on products	—			1,267			46			—			1,313
Gross profit	—			2,560			313			—			2,873
Marketing, administration and research costs	22			387			128			—			537
Operating income (expense)	(22		)	2,173			185			—			2,336
Interest and other debt expense (income), net	237			(18		)	56			—			275
Net periodic benefit (income) cost, excluding service cost	—			(22		)	(5		)	—			(27		)
Earnings from equity investments	(134		)	—			(23		)	—			(157		)
Loss on Cronos-related financial instruments	—			—			137			—			137
Earnings (losses) before income taxes and equity earnings of subsidiaries	(125		)	2,213			20			—			2,108
Provision (benefit) for income taxes	(32		)	550			40			—			558
Equity earnings of subsidiaries	1,645			126			—			(1,771		)	—
Net earnings	1,552			1,789			(20		)	(1,771		)	1,550
Net (earnings) losses attributable to noncontrolling interests	—			—			2			—			2
Net earnings attributable to Altria	$	1,552		$	1,789		$	(18	)	$	(1,771	)	$	1,552


Net earnings	$	1,552		$	1,789		$	(20	)	$	(1,771	)	$	1,550
Other comprehensive earnings (losses), net of deferred income taxes	331			3			28			(31		)	331
Comprehensive earnings	1,883			1,792			8			(1,802		)	1,881
Comprehensive (earnings) losses attributable to noncontrolling interests	—			—			2			—			2
Comprehensive earnings attributable to Altria	$	1,883		$	1,792		$	10		$	(1,802	)	$	1,883

Condensed Consolidating Statements of Earnings and Comprehensive Earnings

For the Three Months Ended March 31, 2019

(in millions of dollars)



	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Net revenues	$	—		$	4,725		$	913		$	(10	)	$	5,628
Cost of sales	—			1,340			248			(10		)	1,578
Excise taxes on products	—			1,185			54			—			1,239
Gross profit	—			2,200			611			—			2,811
Marketing, administration and research costs	35			384			114			—			533
Asset impairment and exit costs	1			35			4			—			40
Operating income (expense)	(36		)	1,781			493			—			2,238
Interest and other debt expense (income), net	355			(25		)	54			—			384
Net periodic benefit (income) cost, excluding service cost	1			—			(2		)	—			(1		)
Earnings from equity investments	(86		)	—			—			—			(86		)
Loss on Cronos-related financial instruments	—			—			425			—			425
Earnings (losses) before income taxes and equity earnings of subsidiaries	(306		)	1,806			16			—			1,516
Provision (benefit) for income taxes	(75		)	459			11			—			395
Equity earnings of subsidiaries	1,351			95			—			(1,446		)	—
Net earnings	1,120			1,442			5			(1,446		)	1,121
Net (earnings) losses attributable to noncontrolling interests	—			—			(1		)	—			(1		)
Net earnings attributable to Altria	$	1,120		$	1,442		$	4		$	(1,446	)	$	1,120


Net earnings	$	1,120		$	1,442		$	5		$	(1,446	)	$	1,121
Other comprehensive earnings (losses), net of deferred income taxes	(170		)	5			23			(28		)	(170		)
Comprehensive earnings	950			1,447			28			(1,474		)	951
Comprehensive (earnings) losses attributable to noncontrolling interests	—			—			(1		)	—			(1		)
Comprehensive earnings attributable to Altria	$	950		$	1,447		$	27		$	(1,474	)	$	950

Condensed Consolidating Statements of Cash Flows

For the Three Months Ended March 31, 2020

(in millions of dollars)



	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Cash Provided by (Used In) Operating Activities
Net cash provided by (used in) operating activities	$	1,515		$	3,351		$	437		$	(2,174	)	$	3,129
Cash Provided by (Used in) Investing Activities
Capital expenditures	—			(15		)	(37		)	—			(52		)
Investment in consolidated subsidiaries	(1		)	—			—			1			—
Other, net	—			—			—			—			—
Net cash provided by (used in) investing activities	(1		)	(15		)	(37		)	1			(52		)
Cash Provided by (Used in) Financing Activities
Proceeds from short-term borrowings	3,000			—			—			—			3,000
Long-term debt repaid	(1,000		)	—			—			—			(1,000		)
Dividends paid on common stock	(1,563		)	—			—			—			(1,563		)
Changes in amounts due to/from Altria Group, Inc. and subsidiaries	1,584			(1,582		)	(1		)	(1		)	—
Cash dividends paid to parent	—			(1,748		)	(426		)	2,174			—
Other, net	(9		)	—			(1		)	—			(10		)
Net cash provided by (used in) financing activities	2,012			(3,330		)	(428		)	2,173			427
Cash, cash equivalents and restricted cash ⁽¹⁾:
Increase (decrease)	3,526			6			(28		)	—			3,504
Balance at beginning of period	2,022			43			95			—			2,160
Balance at end of period	$	5,548		$	49		$	67		$	—		$	5,664


(1)	Restricted cash consisted of cash deposits collateralizing appeal bonds posted by PM USA to obtain stays of judgments pending appeals. See Note 11. Contingencies.

Condensed Consolidating Statements of Cash Flows

For the Three Months Ended March 31, 2019

(in millions of dollars)



	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Cash Provided by (Used In) Operating Activities
Net cash provided by (used in) operating activities	$	1,642		$	2,520		$	166		$	(2,039	)	$	2,289
Cash Provided by (Used in) Investing Activities
Capital expenditures	—			(9		)	(29		)	—			(38		)
Investment in Cronos	—			—			(1,831		)	—			(1,831		)
Investment in consolidated subsidiaries	(1,947		)	—			—			1,947			—
Other, net	(3		)	—			(78		)	—			(81		)
Net cash provided by (used in) investing activities	(1,950		)	(9		)	(1,938		)	1,947			(1,950		)
Cash Provided by (Used in) Financing Activities
Repayment of short-term borrowings	(12,800		)	—			—			—			(12,800		)
Long-term debt issued	16,265			—			—			—			16,265
Repurchases of common stock	(151		)	—			—			—			(151		)
Dividends paid on common stock	(1,502		)	—			—			—			(1,502		)
Changes in amounts due to/from Altria Group, Inc. and subsidiaries	657			(771		)	2,061			(1,947		)	—
Cash dividends paid to parent	—			(1,737		)	(302		)	2,039			—
Other	(120		)	—			(9		)	—			(129		)
Net cash provided by (used in) financing activities	2,349			(2,508		)	1,750			92			1,683
Cash, cash equivalents and restricted cash ⁽¹⁾:
Increase (decrease)	2,041			3			(22		)	—			2,022
Balance at beginning of period	1,277			100			56			—			1,433
Balance at end of period	$	3,318		$	103		$	34		$	—		$	3,455

(1) Restricted cash consisted of cash deposits collateralizing appeal bonds posted by PM USA to obtain stays of judgments pending appeals. See Note 11. Contingencies.