Attached files
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| 8-K - FORM 8-K - REYNOLDS AMERICAN INC | d351279d8k.htm |
Exhibit 99.1
Schedule 1
REYNOLDS AMERICAN INC.
Results by Segment
The R.J. Reynolds segment consists of the primary operations of R.J. Reynolds Tobacco Company, the second-largest tobacco company in the United States and which also manages a contract manufacturing business. Effective January 1, 2012, the results of super premium brands, DUNHILL and STATE EXPRESS 555, transferred into R.J. Reynolds from Santa Fe.
The American Snuff segment consists of the primary operations of American Snuff Company, LLC, the second-largest smokeless tobacco products manufacturer in the United States, and Lane, Limited until its sale on February 28, 2011.
During the fourth quarter of 2011, Reynolds American Inc. began reporting the Santa Fe segment, which consists of the primary operations of Santa Fe Natural Tobacco Company, Inc., which manufactures Natural American Spirit cigarettes and other additive-free tobacco products.
Management uses “adjusted” (non-GAAP) measurements to set performance goals and to measure the performance of the company, and believes that investors’ understanding of the underlying performance of the company’s continuing operations is enhanced through the disclosure of these metrics.
| 2011 | ||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | Full Year | ||||||||||||||||
| R.J. Reynolds |
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| Net sales |
$ | 1,700 | $ | 1,960 | $ | 1,887 | $ | 1,770 | $ | 7,317 | ||||||||||
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| GAAP operating income |
$ | 509 | $ | 461 | $ | 563 | $ | 425 | $ | 1,958 | ||||||||||
| The GAAP results include the following: |
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| Implementation costs included in cost of products sold and selling, general and administrative expenses |
8 | 3 | 5 | — | 16 | |||||||||||||||
| Scott case |
— | 139 | — | — | 139 | |||||||||||||||
| Engle progeny cases |
— | — | 63 | 1 | 64 | |||||||||||||||
| Mark-to-market pension/postretirement adjustments |
— | — | — | 128 | 128 | |||||||||||||||
| Trademark impairment charges |
— | — | — | 43 | 43 | |||||||||||||||
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| Total adjustments |
8 | 142 | 68 | 172 | 390 | |||||||||||||||
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| Adjusted operating income |
$ | 517 | $ | 603 | $ | 631 | $ | 597 | $ | 2,348 | ||||||||||
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| American Snuff |
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| Net sales |
$ | 167 | $ | 153 | $ | 163 | $ | 165 | $ | 648 | ||||||||||
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| GAAP operating income |
$ | 86 | $ | 80 | $ | 89 | $ | 76 | $ | 331 | ||||||||||
| The GAAP results include the following: |
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| Implementation costs included in cost of products sold and selling, general and administrative expenses |
2 | — | 1 | — | 3 | |||||||||||||||
| Trademark impairment charges |
— | — | — | 5 | 5 | |||||||||||||||
| Mark-to-market pension/postretirement adjustments |
— | — | — | 7 | 7 | |||||||||||||||
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| Total adjustments |
2 | — | 1 | 12 | 15 | |||||||||||||||
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| Adjusted operating income |
$ | 88 | $ | 80 | $ | 90 | $ | 88 | $ | 346 | ||||||||||
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| Santa Fe |
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| Net sales |
$ | 92 | $ | 110 | $ | 109 | $ | 105 | $ | 416 | ||||||||||
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| GAAP operating income |
$ | 41 | $ | 51 | $ | 47 | $ | 47 | $ | 186 | ||||||||||
| The GAAP results include the following: |
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| Implementation costs included in cost of products sold and selling, general and administrative expenses |
1 | — | — | — | 1 | |||||||||||||||
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| Total adjustments |
1 | — | — | — | 1 | |||||||||||||||
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| Adjusted operating income |
$ | 42 | $ | 51 | $ | 47 | $ | 47 | $ | 187 | ||||||||||
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Schedule 2
R.J. REYNOLDS CIGARETTE VOLUMES AND SHARE OF MARKET
| 2011 | ||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | Full Year | ||||||||||||||||
| VOLUME (in billions): |
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| Camel |
4.9 | 5.8 | 5.7 | 5.3 | 21.7 | |||||||||||||||
| Pall Mall |
5.2 | 5.8 | 5.7 | 5.4 | 22.0 | |||||||||||||||
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| Total growth brands |
10.0 | 11.6 | 11.4 | 10.7 | 43.7 | |||||||||||||||
| Other |
7.2 | 7.8 | 7.3 | 6.9 | 29.3 | |||||||||||||||
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| Total R.J. Reynolds domestic |
17.3 | 19.4 | 18.7 | 17.6 | 73.0 | |||||||||||||||
| Total R.J. Reynolds exc P/L |
17.2 | 19.3 | 18.6 | 17.5 | 72.7 | |||||||||||||||
| Total premium |
9.7 | 11.1 | 10.7 | 10.1 | 41.6 | |||||||||||||||
| Total value |
7.6 | 8.4 | 8.0 | 7.5 | 31.4 | |||||||||||||||
| Premium/total mix |
56.0 | % | 57.0 | % | 57.4 | % | 57.3 | % | 57.0 | % | ||||||||||
| Industry |
69.6 | 77.4 | 74.4 | 71.7 | 293.1 | |||||||||||||||
| Premium |
49.0 | 55.3 | 51.5 | 50.8 | 206.6 | |||||||||||||||
| Value |
20.6 | 22.1 | 22.8 | 20.9 | 86.5 | |||||||||||||||
| Premium/total mix |
70.4 | % | 71.4 | % | 69.3 | % | 70.9 | % | 70.5 | % | ||||||||||
| RETAIL SHARE OF MARKET: |
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| Camel |
8.3 | % | 8.4 | % | 8.6 | % | 8.6 | % | 8.5 | % | ||||||||||
| Pall Mall |
8.5 | % | 8.6 | % | 8.6 | % | 8.7 | % | 8.6 | % | ||||||||||
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| Total growth brands |
16.9 | % | 16.9 | % | 17.2 | % | 17.4 | % | 17.1 | % | ||||||||||
| Other |
11.1 | % | 10.7 | % | 10.3 | % | 10.0 | % | 10.5 | % | ||||||||||
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| Total R.J. Reynolds domestic |
28.0 | % | 27.6 | % | 27.5 | % | 27.4 | % | 27.6 | % | ||||||||||
| Total R.J. Reynolds exc P/L |
27.9 | % | 27.5 | % | 27.4 | % | 27.3 | % | 27.5 | % | ||||||||||
Amounts are rounded on an individual basis and, accordingly, may not sum in the aggregate.
R.J. Reynolds’ other brands include Winston, Doral, Kool, Salem, Misty and Capri.
Industry volume data based on information from Management Science Associates, Inc.
Retail shares of market are as reported by Information Resources Inc./Capstone.
Schedule 3
AMERICAN SNUFF MOIST-SNUFF VOLUMES AND RETAIL SHARE OF MARKET
| 2011 | ||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | Full Year | ||||||||||||||||
| VOLUME (in millions of cans): |
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| Grizzly |
85.0 | 88.2 | 90.0 | 92.7 | 355.9 | |||||||||||||||
| Other |
12.0 | 12.4 | 12.2 | 12.2 | 48.9 | |||||||||||||||
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| Total moist snuff cans |
97.0 | 100.6 | 102.2 | 104.9 | 404.7 | |||||||||||||||
| RETAIL SHARE OF MARKET: |
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| Grizzly |
26.5 | % | 27.0 | % | 27.6 | % | 28.0 | % | 27.3 | % | ||||||||||
| Other |
3.8 | % | 3.7 | % | 3.6 | % | 3.6 | % | 3.6 | % | ||||||||||
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| Total retail share of market |
30.3 | % | 30.7 | % | 31.2 | % | 31.6 | % | 30.9 | % | ||||||||||
Amounts are rounded on an individual basis and, accordingly, may not sum in the aggregate.
Retail shares of market are as reported by Information Resources Inc./Capstone.
Schedule 4
SANTA FE VOLUMES AND RETAIL SHARE OF MARKET
| 2011 | ||||||||||||||||||||
| Q1 | Q2 | Q3 | Q4 | Full Year | ||||||||||||||||
| VOLUME (in billions): |
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| Natural American Spirit |
0.6 | 0.8 | 0.7 | 0.7 | 2.8 | |||||||||||||||
| RETAIL SHARE OF MARKET: |
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| Natural American Spirit |
0.9 | % | 0.9 | % | 1.0 | % | 1.1 | % | 1.0 | % | ||||||||||
Amounts are rounded on an individual basis and, accordingly, may not sum in the aggregate.
Retail shares of market are as reported by Information Resources Inc./Capstone.