Altria Gets Some Competition

By Douglas A. McIntyre Published Dec 14, 11:33AM EST

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Altria’s Philip Morris is the largest tobacco company in the world. That gives the company a lot of economies of scale, especially in sourcing tobacco and getting shelf space for its cigarettes.

It looks like the Marlboro man is getting some real competition in the merger of Japan Tobacco and UK cigarette company Gallaher.

Philip Morris is unlikely to have an problems with the new tobacco conglomerate in its home market of the US. But a look at the MO 10-K shows that international operations are almost three times as big as the domestic business. International is also growing faster. It brought in $12.7 billion in the last quarter. Operating income for the group was $2.1 billion.

Philip Morris volume was off 2.4% last quarter. Sales fell in key markets like Germany and Spain. Unit sales also dropped in Japan.

A new merged Japan Tobacco/Gallaher is not likely to help any of that.

Douglas A. McIntyre can be reached at [email protected]. He does not own securities in companies that he writea about.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.