Asset Impairment, Exit and Implementation Costs

12 Months Ended

Dec. 31, 2024

Restructuring and Related Activities [Abstract]

Asset Impairment, Exit and Implementation Costs

Pre-tax asset impairment, exit and implementation costs consisted of the following for the year ended December 31, 2024:


(in millions)	Asset Impairment and Exit Costs		Implementation Costs (1)	Total

Smokeable products	$	31		$	29	$	60
Oral tobacco products (2)	358			4		362
Total	$	389		$	33	$	422

(1) Included in marketing, administration and research costs in our consolidated statement of earnings.

(2) Includes impairment of the Skoal trademark of $354 million. See Note 6. Goodwill and Other Intangible Assets, net.

There were no asset impairment, exit or implementation costs for the years ended December 31, 2023 and 2022.

In October 2024, we announced a multi-phase Optimize & Accelerate initiative (“Initiative”) designed to modernize our ways of working. Through the Initiative, we plan to increase our organization’s speed, efficiency and effectiveness by centralizing work, outsourcing certain transactional tasks and streamlining, automating and standardizing processes. We expect the design and detailed plans for all phases of the Initiative to be substantially complete in early 2026.

We estimate total pre-tax charges for the Initiative’s initial phases of approximately $100 million to $125 million. Of these amounts, during 2024, we incurred pre-tax charges of $68 million, consisting of employee separation cost of $35 million and implementation costs of $33 million. We expect to record the majority of the remaining costs for these initial phases in the first half of 2025. Substantially all of these charges will result in cash expenditures and will consist of severance payments associated with employee separations, implementation costs for new technology and business advisory services and other costs. Employee separation costs are recorded when probable and reasonably estimable. As we further develop and finalize detailed plans for the additional phases of the Initiative, we will update estimated pre-tax charges for the Initiative.

We made cash payments of $11 million for the Initiative in 2024 all of which were related to implementation costs. At December 31, 2024, restructuring liabilities, all of which were severance liabilities, were $35 million.