(Reuters) – Altria Group expanded its share buyback program by $2.4 billion and raised its annual profit forecast on Thursday, after the Marlboro maker agreed to sell about 10% of its stake in brewer Anheuser-Busch InBev.
The company will also invest part of the proceeds from the sale, announced on Wednesday, to bolster its shift to alternatives to traditional combustible cigarettes as well as to pay down debt.
Altria, like other tobacco giants, has been grappling with tougher tobacco regulations, stiff competition from disposable vapes, as well as a shift to cheaper brands from cost-conscious consumers.
The company has focused on smoke-less alternatives such as NJOY vapes, as well as tobacco-free nicotine pouches that have gained traction in some of its markets.
Altria’s shares were up about 1% in morning trade.
The company now expects 2024 adjusted earnings per share to be between $5.05 and $5.17 per share, compared with its prior expectation of $5 to $5.15.
The sale of around 35 million AB InBev shares, along with the brewer’s repurchase of shares worth $200 million from Altria, would generate around $2.4 billion, the company said.
Altria’s holding in AB InBev will fall to around 8.1%, or 7.8%, if the underwriters fully exercise an option to purchase additional securities.
(Reporting by Juveria Tabassum; Editing by Sriraj Kalluvila)
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