Condensed Consolidating Financial Information (Tables)

12 Months Ended

Dec. 31, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Condensed Consolidating Balance Sheet

Condensed Consolidating Balance Sheets

(in millions of dollars)

____________________________

at December 31, 2016	Altria Group, Inc.		PM USA		Non- Guarantor Subsidiaries		Total Consolidating Adjustments			Consolidated
Assets
Cash and cash equivalents	$	4,521	$	1	$	47	$	—		$	4,569
Receivables	—		8		143		—			151
Inventories:
Leaf tobacco	—		541		351		—			892
Other raw materials	—		111		53		—			164
Work in process	—		3		509		—			512
Finished product	—		112		371		—			483
	—		767		1,284		—			2,051
Due from Altria Group, Inc. and subsidiaries	—		3,797		1,511		(5,308		)	—
Other current assets	170		118		201		—			489
Total current assets	4,691		4,691		3,186		(5,308		)	7,260
Property, plant and equipment, at cost	—		2,971		1,864		—			4,835
Less accumulated depreciation	—		2,073		804		—			2,877
	—		898		1,060		—			1,958
Goodwill	—		—		5,285		—			5,285
Other intangible assets, net	—		2		12,034		—			12,036
Investment in AB InBev	17,852		—		—		—			17,852
Investment in consolidated subsidiaries	11,636		2,632		—		(14,268		)	—
Finance assets, net	—		—		1,028		—			1,028
Due from Altria Group, Inc. and subsidiaries	4,790		—		—		(4,790		)	—
Other assets	18		1,748		131		(1,384		)	513
Total Assets	$	38,987	$	9,971	$	22,724	$	(25,750	)	$	45,932

Condensed Consolidating Balance Sheets (Continued)

(in millions of dollars)

____________________________

at December 31, 2016	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Liabilities
Accounts payable	$	1		$	92		$	332		$	—		$	425
Accrued liabilities:
Marketing	—			619			128			—			747
Employment costs	104			14			171			—			289
Settlement charges	—			3,696			5			—			3,701
Other	261			438			326			—			1,025
Dividends payable	1,188			—			—			—			1,188
Due to Altria Group, Inc. and subsidiaries	5,030			237			41			(5,308		)	—
Total current liabilities	6,584			5,096			1,003			(5,308		)	7,375
Long-term debt	13,881			—			—			—			13,881
Deferred income taxes	5,424			—			4,376			(1,384		)	8,416
Accrued pension costs	207			—			598			—			805
Accrued postretirement health care costs	—			1,453			764			—			2,217
Due to Altria Group, Inc. and subsidiaries	—			—			4,790			(4,790		)	—
Other liabilities	121			146			160			—			427
Total liabilities	26,217			6,695			11,691			(11,482		)	33,121
Contingencies
Redeemable noncontrolling interest	—			—			38			—			38
Stockholders’ Equity
Common stock	935			—			9			(9		)	935
Additional paid-in capital	5,893			3,310			11,585			(14,895		)	5,893
Earnings reinvested in the business	36,906			237			1,118			(1,355		)	36,906
Accumulated other comprehensive losses	(2,052		)	(271		)	(1,720		)	1,991			(2,052		)
Cost of repurchased stock	(28,912		)	—			—			—			(28,912		)
Total stockholders’ equity attributable to Altria Group, Inc.	12,770			3,276			10,992			(14,268		)	12,770
Noncontrolling interests	—			—			3			—			3
Total stockholders’ equity	12,770			3,276			10,995			(14,268		)	12,773
Total Liabilities and Stockholders’ Equity	$	38,987		$	9,971		$	22,724		$	(25,750	)	$	45,932

Condensed Consolidating Balance Sheets

(in millions of dollars)

____________________________

at December 31, 2015	Altria Group, Inc.		PM USA		Non- Guarantor Subsidiaries		Total Consolidating Adjustments			Consolidated
Assets
Cash and cash equivalents	$	2,313	$	—	$	56	$	—		$	2,369
Receivables	—		7		117		—			124
Inventories:
Leaf tobacco	—		562		395		—			957
Other raw materials	—		123		58		—			181
Work in process	—		5		439		—			444
Finished product	—		121		328		—			449
	—		811		1,220		—			2,031
Due from Altria Group, Inc. and subsidiaries	—		3,821		1,807		(5,628		)	—
Other current assets	284		65		112		(74		)	387
Total current assets	2,597		4,704		3,312		(5,702		)	4,911
Property, plant and equipment, at cost	—		3,102		1,775		—			4,877
Less accumulated depreciation	—		2,157		738		—			2,895
	—		945		1,037		—			1,982
Goodwill	—		—		5,285		—			5,285
Other intangible assets, net	—		2		12,026		—			12,028
Investment in SABMiller	5,483		—		—		—			5,483
Investment in consolidated subsidiaries	11,648		2,715		—		(14,363		)	—
Finance assets, net	—		—		1,239		—			1,239
Due from Altria Group, Inc. and subsidiaries	4,790		—		—		(4,790		)	—
Other assets	20		1,804		138		(1,431		)	531
Total Assets	$	24,538	$	10,170	$	23,037	$	(26,286	)	$	31,459

Condensed Consolidating Balance Sheets (Continued)

(in millions of dollars)

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at December 31, 2015	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Liabilities
Current portion of long-term debt	$	—		$	—		$	4		$	—		$	4
Accounts payable	3			104			293			—			400
Accrued liabilities:
Marketing	—			586			109			—			695
Employment costs	18			11			169			—			198
Settlement charges	—			3,585			5			—			3,590
Other	255			616			276			(74		)	1,073
Dividends payable	1,110			—			—			—			1,110
Due to Altria Group, Inc. and subsidiaries	5,427			191			10			(5,628		)	—
Total current liabilities	6,813			5,093			866			(5,702		)	7,070
Long-term debt	12,831			—			12			—			12,843
Deferred income taxes	1,646			—			4,452			(1,431		)	4,667
Accrued pension costs	215			—			1,062			—			1,277
Accrued postretirement health care costs	—			1,460			785			—			2,245
Due to Altria Group, Inc. and subsidiaries	—			—			4,790			(4,790		)	—
Other liabilities	153			126			168			—			447
Total liabilities	21,658			6,679			12,135			(11,923		)	28,549
Contingencies
Redeemable noncontrolling interest	—			—			37			—			37
Stockholders’ Equity
Common stock	935			—			9			(9		)	935
Additional paid-in capital	5,813			3,310			11,456			(14,766		)	5,813
Earnings reinvested in the business	27,257			436			1,099			(1,535		)	27,257
Accumulated other comprehensive losses	(3,280		)	(255		)	(1,692		)	1,947			(3,280		)
Cost of repurchased stock	(27,845		)	—			—			—			(27,845		)
Total stockholders’ equity attributable to Altria Group, Inc.	2,880			3,491			10,872			(14,363		)	2,880
Noncontrolling interests	—			—			(7		)	—			(7		)
Total stockholders’ equity	2,880			3,491			10,865			(14,363		)	2,873
Total Liabilities and Stockholders’ Equity	$	24,538		$	10,170		$	23,037		$	(26,286	)	$	31,459

Condensed Consolidating of Earnings and Comprehensive Earnings Income Statement

Condensed Consolidating Statements of Earnings and Comprehensive Earnings

(in millions of dollars)

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for the year ended December 31, 2016	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Net revenues	$	—		$	22,146		$	3,633		$	(35	)	$	25,744
Cost of sales	—			6,628			1,153			(35		)	7,746
Excise taxes on products	—			6,187			220			—			6,407
Gross profit	—			9,331			2,260			—			11,591
Marketing, administration and research costs	165			1,996			489			—			2,650
Asset impairment and exit costs	5			97			77			—			179
Operating (expense) income	(170		)	7,238			1,694			—			8,762
Interest and other debt expense, net	519			10			218			—			747
Loss on early extinguishment of debt	823			—			—			—			823
Earnings from equity investment in SABMiller	(795		)	—			—			—			(795		)
Gain on AB InBev/SABMiller business combination	(13,865		)	—			—			—			(13,865		)
Earnings before income taxes and equity earnings of subsidiaries	13,148			7,228			1,476			—			21,852
Provision for income taxes	4,453			2,631			524			—			7,608
Equity earnings of subsidiaries	5,544			268			—			(5,812		)	—
Net earnings	14,239			4,865			952			(5,812		)	14,244
Net earnings attributable to noncontrolling interests	—			—			(5		)	—			(5		)
Net earnings attributable to Altria Group, Inc.	$	14,239		$	4,865		$	947		$	(5,812	)	$	14,239
Net earnings	$	14,239		$	4,865		$	952		$	(5,812	)	$	14,244
Other comprehensive earnings (losses), net of deferred income taxes	1,228			(16		)	(28		)	44			1,228
Comprehensive earnings	15,467			4,849			924			(5,768		)	15,472
Comprehensive earnings attributable to noncontrolling interests	—			—			(5		)	—			(5		)
Comprehensive earnings attributable to Altria Group, Inc.	$	15,467		$	4,849		$	919		$	(5,768	)	$	15,467

Condensed Consolidating Statements of Earnings and Comprehensive Earnings

(in millions of dollars)

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for the year ended December 31, 2015	Altria Group, Inc.			PM USA		Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Net revenues	$	—		$	22,133	$	3,342		$	(41	)	$	25,434
Cost of sales	—			6,664		1,117			(41		)	7,740
Excise taxes on products	—			6,369		211			—			6,580
Gross profit	—			9,100		2,014			—			11,114
Marketing, administration and research costs	189			2,094		425			—			2,708
Reduction of PMI tax-related receivable	41			—		—			—			41
Asset impairment and exit costs	—			—		4			—			4
Operating (expense) income	(230		)	7,006		1,585			—			8,361
Interest and other debt expense, net	560			33		224			—			817
Loss on early extinguishment of debt	228			—		—			—			228
Earnings from equity investment in SABMiller	(757		)	—		—			—			(757		)
Gain on AB InBev/SABMiller business combination	(5		)	—		—			—			(5		)
(Loss) earnings before income taxes and equity earnings of subsidiaries	(256		)	6,973		1,361			—			8,078
(Benefit) provision for income taxes	(184		)	2,536		483			—			2,835
Equity earnings of subsidiaries	5,313			268		—			(5,581		)	—
Net earnings	5,241			4,705		878			(5,581		)	5,243
Net earnings attributable to noncontrolling interests	—			—		(2		)	—			(2		)
Net earnings attributable to Altria Group, Inc.	$	5,241		$	4,705	$	876		$	(5,581	)	$	5,241
Net earnings	$	5,241		$	4,705	$	878		$	(5,581	)	$	5,243
Other comprehensive (losses) earnings, net of deferred income taxes	(598		)	86		(69		)	(17		)	(598		)
Comprehensive earnings	4,643			4,791		809			(5,598		)	4,645
Comprehensive earnings attributable to noncontrolling interests	—			—		(2		)	—			(2		)
Comprehensive earnings attributable to Altria Group, Inc.	$	4,643		$	4,791	$	807		$	(5,598	)	$	4,643

Condensed Consolidating Statements of Earnings and Comprehensive Earnings

(in millions of dollars)

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for the year ended December 31, 2014	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Net revenues	$	—		$	21,298		$	3,267		$	(43	)	$	24,522
Cost of sales	—			6,722			1,106			(43		)	7,785
Excise taxes on products	—			6,358			219			—			6,577
Gross profit	—			8,218			1,942			—			10,160
Marketing, administration and research costs	231			1,889			419			—			2,539
Reduction of Mondelēz tax-related receivable	2			—			—			—			2
Asset impairment and exit costs	—			(6		)	5			—			(1		)
Operating (expense) income	(233		)	6,335			1,518			—			7,620
Interest and other debt expense (income), net	614			(46		)	240			—			808
Loss on early extinguishment of debt	—			—			44			—			44
Earnings from equity investment in SABMiller	(1,006		)	—			—			—			(1,006		)
Earnings before income taxes and equity earnings of subsidiaries	159			6,381			1,234			—			7,774
(Benefit) provision for income taxes	(119		)	2,381			442			—			2,704
Equity earnings of subsidiaries	4,792			244			—			(5,036		)	—
Net earnings	5,070			4,244			792			(5,036		)	5,070
Net earnings attributable to noncontrolling interests	—			—			—			—			—
Net earnings attributable to Altria Group, Inc.	$	5,070		$	4,244		$	792		$	(5,036	)	$	5,070
Net earnings	$	5,070		$	4,244		$	792		$	(5,036	)	$	5,070
Other comprehensive losses, net of deferred income taxes	(1,304		)	(110		)	(642		)	752			(1,304		)
Comprehensive earnings	3,766			4,134			150			(4,284		)	3,766
Comprehensive earnings attributable to noncontrolling interests	—			—			—			—			—
Comprehensive earnings attributable to Altria Group, Inc.	$	3,766		$	4,134		$	150		$	(4,284	)	$	3,766

Condensed Consolidating Statement of Cash Flows

Condensed Consolidating Statements of Cash Flows

(in millions of dollars)

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for the year ended December 31, 2016	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Cash Provided by Operating Activities
Net cash provided by operating activities	$	4,326		$	5,138		$	319		$	(5,992	)	$	3,791
Cash Provided by (Used in) Investing Activities
Capital expenditures	—			(45		)	(144		)	—			(189		)
Proceeds from finance assets	—			—			231			—			231
Proceeds from AB InBev/SABMiller business combination	4,773			—			—			—			4,773
Purchase of AB InBev ordinary shares	(1,578		)	—			—			—			(1,578		)
Payment for derivative financial instrument	(3		)	—			—			—			(3		)
Proceeds from derivative financial instruments	510			—			—			—			510
Other	—			—			(36		)	—			(36		)
Net cash provided by (used in) investing activities	3,702			(45		)	51			—			3,708
Cash Provided by (Used in) Financing Activities
Long-term debt issued	1,976			—			—			—			1,976
Long-term debt repaid	(933		)	—			—			—			(933		)
Repurchases of common stock	(1,030		)	—			—			—			(1,030		)
Dividends paid on common stock	(4,512		)	—			—			—			(4,512		)
Changes in amounts due to/from Altria Group, Inc. and subsidiaries	(530		)	(28		)	558			—			—
Premiums and fees related to early extinguishment of debt	(809		)	—			—			—			(809		)
Cash dividends paid to parent	—			(5,064		)	(928		)	5,992			—
Other	18			—			(9		)	—			9
Net cash used in financing activities	(5,820		)	(5,092		)	(379		)	5,992			(5,299		)
Cash and cash equivalents:
Increase (decrease)	2,208			1			(9		)	—			2,200
Balance at beginning of year	2,313			—			56			—			2,369
Balance at end of year	$	4,521		$	1		$	47		$	—		$	4,569

Condensed Consolidating Statements of Cash Flows

(in millions of dollars)

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for the year ended December 31, 2015	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Cash Provided by Operating Activities
Net cash provided by operating activities	$	5,085		$	5,204		$	961		$	(5,440	)	$	5,810
Cash Provided by (Used in) Investing Activities
Capital expenditures	—			(51		)	(178		)	—			(229		)
Proceeds from finance assets	—			—			354			—			354
Payment for derivative financial instrument	(132		)	—			—			—			(132		)
Other	—			10			(18		)	—			(8		)
Net cash (used in) provided by investing activities	(132		)	(41		)	158			—			(15		)
Cash Provided by (Used in) Financing Activities
Long-term debt repaid	(1,793		)	—			—			—			(1,793		)
Repurchases of common stock	(554		)	—			—			—			(554		)
Dividends paid on common stock	(4,179		)	—			—			—			(4,179		)
Changes in amounts due to/from Altria Group, Inc. and subsidiaries	814			(495		)	(319		)	—			—
Premiums and fees related to early extinguishment of debt	(226		)	—			—			—			(226		)
Cash dividends paid to parent	—			(4,671		)	(769		)	5,440			—
Other	17			—			(12		)	—			5
Net cash used in financing activities	(5,921		)	(5,166		)	(1,100		)	5,440			(6,747		)
Cash and cash equivalents:
(Decrease) increase	(968		)	(3		)	19			—			(952		)
Balance at beginning of year	3,281			3			37			—			3,321
Balance at end of year	$	2,313		$	—		$	56		$	—		$	2,369

Condensed Consolidating Statements of Cash Flows

(in millions of dollars)

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for the year ended December 31, 2014	Altria Group, Inc.			PM USA			Non- Guarantor Subsidiaries			Total Consolidating Adjustments			Consolidated
Cash Provided by Operating Activities
Net cash provided by operating activities	$	4,924		$	4,451		$	707		$	(5,419	)	$	4,663
Cash Provided by (Used in) Investing Activities
Capital expenditures	—			(44		)	(119		)	—			(163		)
Acquisition of Green Smoke, net of acquired cash	—			—			(102		)	—			(102		)
Proceeds from finance assets	—			—			369			—			369
Other	—			70			3			—			73
Net cash provided by investing activities	—			26			151			—			177
Cash Provided by (Used in) Financing Activities
Long-term debt issued	999			—			—			—			999
Long-term debt repaid	(525		)	—			(300		)	—			(825		)
Repurchases of common stock	(939		)	—			—			—			(939		)
Dividends paid on common stock	(3,892		)	—			—			—			(3,892		)
Changes in amounts due to/from Altria Group, Inc. and subsidiaries	(411		)	(351		)	762			—			—
Premiums and fees related to early extinguishment of debt	—			—			(44		)	—			(44		)
Cash dividends paid to parent	—			(4,124		)	(1,295		)	5,419			—
Other	11			—			(4		)	—			7
Net cash used in financing activities	(4,757		)	(4,475		)	(881		)	5,419			(4,694		)
Cash and cash equivalents:
Increase (decrease)	167			2			(23		)	—			146
Balance at beginning of year	3,114			1			60			—			3,175
Balance at end of year	$	3,281		$	3		$	37		$	—		$	3,321