US Marlboro-maker Altria to cash in on duty drawback this year

By Emma Rumney and ⁠Angela Christy M

Jan ⁠29 (Reuters) - ‍Tobacco group Altria expects profit to be boosted in the second half of this year by making use of a U.S. ‍tax rebate on increased imports and exports of cigarettes, after ​just missing fourth quarter 2025 profit estimates on Thursday.

Although Altria said its full-year profit for ​2026 would be ahead of analyst estimates, its shares fell around 2.8%.

Tobacco companies exporting their products outside the United States have been taking advantage of a provision that ​allows them to claw back federal excise taxes paid on domestically sold products known as the 'double duty drawback'.

They can reclaim duties paid on ​domestic cigarette sales when they export similar products overseas, even if the exported products themselves were never ‌taxed.

Altria has been unable to capitalise on this because, unlike major rivals like British American Tobacco, it does not ​sell cigarettes outside the United States.

However, the ⁠maker of Marlboro in the United States is using partnerships with foreign tobacco companies like Korea's KT&G to grow ‌its cigarette exports, including by contract manufacturing.

Altria finance chief Salvatore Mancuso, who becomes CEO in May, told Reuters it would be foolish not to take advantage of ‌the provision and to remain at a competitive disadvantage.

With tobacco sales in decline, Altria has ‌looked to build up revenues from new products like nicotine pouch label On!. But it has faced challenges, including rivals taking market share.

Bernstein analysts said that while Altria ‍may be able to boost profits with the duty drawback, it faces a "challenging picture" as it responds to such ⁠pressures.

Altria expects annual adjusted earnings of $5.56 to $5.72 per share for 2026, the midpoint of which is higher than analysts' estimate of $5.58, LSEG data shows.

(Reporting by Angela Christy in Bengaluru and Emma Rumney in London; Editing by Shilpi Majumdar, Krishna Chandra Eluri and Alexander Smith)

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