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backed its 2003 earnings guidance and said a "watershed year" for smoking litigation positions it well for the future.

Philip Morris' parent said it will earn $4.50 to $4.60 a share in 2003 and added that it's comfortable with the consensus estimate of $4.53 as compiled by Thomson First Call.

In 2004, Altria expects income at its operating companies to rise in the low single digits, with operating company income at Philip Morris International rising in the high single digits in years to come. It noted that



, in which it retains a sizable equity interest, has acknowledged that 2004 will be a "difficult year."

Analysts expect Altria to earn $4.87 per share in all of 2004.

The company said that this year's Supreme Court decision limiting the scope of some punitive damages awards, along with other smoking-related decisions, augur well for its long-term prospects, and the company currently expects to produce free cash flow of $50 billion between now and 2007.

"We will continue to use the vast majority of this cash to reward shareholders through dividends and share repurchases," it added. The shares were recently up 16 cents, or 0.3%, to $46.69.