In terms of Altria’s oral nicotine business, its subsidiary Helix has expanded the distribution of on! by an additional 22,000 stores, bringing its total store count to 78,000, an increase of nearly 40 percent from the end of the third quarter and more than five times the amount of stores the product was in at the end of 2019. Currently, on! has achieved a retail share of 2.4 percentage points of the oral tobacco category in 2020.
Altria has seen a negative impact on other investments due to the COVID-19 pandemic. Because of the pandemic, ABI has seen a 50 percent reduction to its final 2019 dividend paid in the second quarter of 2020 and a decision to forgo its interim 2020 dividend that would have been paid in the second quarter of 2020. There was a steep decline in ABI’s stock price during the first half of 2020 and even after a slight recovery, the fear value of Altria’s investment in ABI remains below the carrying value. Altria states that it believes this decline is temporary. In November, Altria exercised its right to convert its non-voting shares in JUUL to voting shares pursuant to its December 2018 investment in JUUL. Altria does not have any current plans to exercise its additional governance rights obtained upon Share Conversion or to vote its JUUL shares other than as a passive investor, pending the outcome of the U.S. Federal Trade Commission litigation.
Altria expects its 2021 full-year adjusted diluted EPS to be in a range of $4.49 to $4.62, representing a growth rate of 3 percent to 6 percent from an adjusted diluted EPS base of $4.36 in 2020. Altria expects 2021 adjusted diluted EPS growth to come in the last three quarters of the year, “primarily due to prior year comparisons, including one fewer shipping day for the smokeable products segment in the first quarter. Altria expects its 2021 full-year adjusted effective tax rate will be in a range of 24.5-25.5 percent.”
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