XML 28 R16.htm IDEA: XBRL DOCUMENT
v3.22.2

Segment Reporting | 6 Months Ended
--- | ---
Jun. 30, 2022
Segment Reporting [Abstract] |
Segment Reporting | Segment Reporting Our products include smokeable tobacco products, consisting of combustible cigarettes manufactured and sold by PM USA, and machine-made large cigars and pipe tobacco manufactured and sold by Middleton; oral tobacco products, consisting of MST and snus products manufactured and sold by USSTC, and oral nicotine pouches manufactured and sold by Helix. These products constitute our reportable segments of smokeable products and oral tobacco products at June 30, 2022. The financial services and the innovative tobacco products businesses, which include the heated tobacco business and Helix ROW, are included in all other. Prior to the sale of our wine business on October 1, 2021, wine produced and/or sold by Ste. Michelle was a reportable segment. Our chief operating decision maker (“CODM”) reviews operating companies income (loss) (“OCI”) to evaluate the performance of, and allocate resources to, our segments. OCI for our segments is defined as operating income before general corporate expenses and amortization of intangibles. Interest and other debt expense, net, along with net periodic benefit income/cost, excluding service cost, and provision for income taxes are centrally managed at the corporate level and, accordingly, such items are not presented by segment since they are excluded from the measure of segment profitability reviewed by our CODM. Segment data were as follows:
|  | For the Six Months Ended June 30, |  | For the Three Months Ended June 30,
(in millions) |  | 2022 |  | 2021 |  | 2022 |  | 2021
Net Revenues: |  |  |  |  |  |  |  |
Smokeable products |  | $ | 11,138 |  |  | $ | 11,300 |  |  | $ | 5,873 |  |  | $ | 6,050 |
Oral tobacco products |  | 1,278 |  |  | 1,319 |  |  | 665 |  |  | 693 |
Wine |  | — |  |  | 317 |  | — |  |  | 167 |
All other |  | 19 |  |  | 36 |  |  | 5 |  |  | 26 |
Net revenues |  | $ | 12,435 |  |  | $ | 12,972 |  |  | $ | 6,543 |  |  | $ | 6,936 |
Earnings before Income Taxes: |  |  |  |  |  |  |  |
OCI: |  |  |  |  |  |  |  |
Smokeable products |  | $ | 5,321 |  |  | $ | 5,148 |  |  | $ | 2,762 |  |  | $ | 2,776 |
Oral tobacco products |  | 837 |  |  | 864 |  |  | 430 |  |  | 472 |
Wine |  | — |  |  | 45 |  |  | — |  |  | 27 |
All other |  | (20) |  |  | (26) |  |  | (15) |  |  | (12) |
Amortization of intangibles |  | (35) |  |  | (35) |  |  | (18) |  |  | (18) |
General corporate expenses |  | (114) |  |  | (120) |  |  | (54) |  |  | (59) |
Operating income |  | 5,989 |  |  | 5,876 |  |  | 3,105 |  |  | 3,186 |
Interest and other debt expense, net |  | 561 |  |  | 603 |  |  | 280 |  |  | 295 |
Loss on early extinguishment of debt |  | — |  |  | 649 |  |  | — |  |  | — |
Net periodic benefit income, excluding service cost |  | (93) |  |  | (89) |  |  | (47) |  |  | (46) |
(Income) losses from equity investments |  | 1,229 |  |  | (126) |  |  | 1,263 |  |  | (75) |
(Gain) loss on Cronos-related financial instruments |  | 14 |  |  | (7) |  |  | 4 |  |  | 103 |
Earnings before income taxes |  | $ | 4,278 |  |  | $ | 4,846 |  |  | $ | 1,605 |  |  | $ | 2,909 |
The comparability of OCI for our reportable segments was affected by the following: ▪Non-Participating Manufacturer (“NPM”) Adjustment Items: We recorded pre-tax income for NPM adjustment items of $60 million and $32 million for the six months ended June 30, 2022 and 2021, respectively, in our smokeable products segment. We recorded these items in cost of sales in our condensed consolidated statements of earnings. NPM adjustment items result from the resolutions of certain disputes with states and territories related to the NPM adjustment provision under the Master Settlement Agreement (such dispute resolutions are referred to as “NPM Adjustment Items” and are more fully described in Health Care Cost Recovery Litigation in Note 11. Contingencies). ▪Tobacco and Health and Certain Other Litigation Items: We recorded pre-tax charges related to tobacco and health and certain other litigation items as follows:
|  | For the Six Months Ended June 30, |  | For the Three Months Ended June 30,
(in millions) |  | 2022 |  | 2021 |  | 2022 |  | 2021
Smokeable products segment |  | $ | 50 |  |  | $ | 43 |  |  | $ | 38 |  |  | $ | 8 |
General corporate expenses |  | 7 |  |  | — |  |  | 7 |  |  | — |
Interest and other debt expense, net |  | 1 |  |  | — |  |  | 1 |  |  | — |
Total |  | $ | 58 |  |  | $ | 43 |  |  | $ | 46 |  |  | $ | 8 |
We recorded the amounts shown in the table above for the smokeable products segment in marketing, administration and research costs in our condensed consolidated statements of earnings. For further discussion, see Note 11. Contingencies. ▪Acquisition-Related Costs: We recorded pre-tax acquisition-related costs of $37 million for the six months ended June 30, 2021 in our oral tobacco products segment primarily for the settlement of an arbitration related to the 2019 on! transaction. We included these costs in marketing, administration and research costs in our condensed consolidated statements of earnings.

X
- References No definition available. + Details
Name: | us-gaap_SegmentReportingAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI https://asc.fasb.org/topic&trid=2134510 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration