Altria Group Inc.’s (NYSE:MO) latest developments
Denver, CO, 07/29/2013 (Avauncer.com) – Altria Group Inc. (NYSE:MO) (Closed: $35.90, Down: 0.03%) announced that it would launch its first electronic cigarettes under the brand MarkTen in Indiana in the next month. Due to restrictions and tax hikes on selling cigarettes implemented by government, the company is losing its market share. In order to survive it is necessary to diversify their business which led to launch electronic cigarettes powered by battery which produces vapor inhaled by the users. Altria group’s CEO said that such cigarettes will address both addictive and behavioral aspects of smoking. This will take care of the health concerns, social disgrace and other rising environmental issues that come up due to smoking. Such an initiative will also raise the company’s position in the people’s mind due to the steps adopted to curb emissions from smoking.
Altria’s Marlboro NXT has been distributed to 23 new states this month, mostly in the U.S. This brand is having some additional features over Philip Morris’s Marlboro Black with a crushable menthol capsule. The company perceived that the cigarette has been well accepted by the consumers. In addition to the above two cigarettes Altria will also launch Verve which has tobacco-less nicotine in Virginia in September.
After a review made by Food and Drug administration, there is little evidence that shows menthol cigarettes are more toxic and contribute more to diseases than normal cigarettes. And as young smokers are more prone to menthol cigarettes it is found that nicotine effect is more in such cigarettes and making it difficult for them to give up smoking. Due to this opinion, cigarette industry, including Altria, took a hit in their share price.
The company managed to post a profit of 3% in spite of declining sales from the increasing prices due to increased taxes.