Altria Group Inc. CEO Billy Gifford told participants at Wednesday’s Consumer Analyst Group of New York (CAGNY) Conference that he’s “confident about the future for tobacco harm reduction in the U.S.”
Gifford’s remarks were made at the CAGNY conference held in Boca Raton, Florida, which offered an insight into the company’s vision to lead the transition of adult smokers to a smoke-free future.
“There is a significant opportunity to shift millions of smokers away from cigarettes to the benefit of adult tobacco consumers, our shareholders and society,” said Gifford in a statement. “As the leader in the U.S. nicotine industry, we believe we are best positioned to lead the tobacco harm reduction opportunity.”
During his presentation, Gifford highlighted several objectives to reach this goal: maintain the strength of the company’s highly profitable core tobacco businesses; invest behind current and future potential growth drivers including on!, NJOY and other innovations that include heated tobacco and non-nicotine adjacencies; and continue to grow EPS over time.
Looking to move the company beyond smoking, Gifford pointed out that of the “52 million tobacco consumers, we estimate that nearly 30% exclusively use smoke-free formats.” With today’s tobacco consumer seeking new options, Gifford said “approximately two-thirds of smokers are interested in potentially less harmful tobacco products.”
Gifford outlined how on! and NJOY now are key contributors to Altria’s harm reduction framework. Last year Altria acquired the e-vapor company NJOY, whose products are now distributed by Altria Group Distribution Co.
As for NJOY’s long-term growth plans, Gifford said that for this year, “we are focusing on continuous improvement across trial generation, availability, presence at retail and connecting with consumers.” He also mentioned that to further improve availability, “we plan to expand distribution of NJOY to approximately 100,000 stores this year.”
During the presentation Gifford said the tobacco company is finalizing premarket tobacco product applications (PMTAs) for blueberry and watermelon flavored NJOY products with age-gated Bluetooth technology.
Goldman Sachs Managing Director Bonnie Herzog said that it was an “upbeat presentation that highlighted MO’s strategy to balance earnings growth with shareholder returns while investing toward its 2030 Vision to lead the transition of adult smokers to a smoke-free future.”
Herzog noted that “despite some uncertainty about the rise of illicit disposable e-vapor market activity and its impact on cig/vapor industry trends, we remain optimistic, as we don’t think it takes away from management’s ability to successfully execute its profit maximizing strategy in cigs/smokeables.”
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