Altria being financially disciplined in test marketing their smokeless products..

August 6, 2008 - On June 12, 2008 we reported that Altria was falling short on growth because of slowness in developing smokeless tobacco products.

From Todd Sullivan's Value Plays, Altria Earnings Q2 2008 call notes.

Altria Q2 2008 earning calls there was only one question on Altria's entry into the area of smokeless and cigar usage.

Here is the sole exchange on it:
David Adelman - Morgan Stanley
"Okay and then secondly Dave I am curious about your reactions to the observation particularly given some increased pace of movement within tobacco but outside the cigarette category that you are not moving more aggressively with respect to moist smokeless tobacco and particular and perhaps Snus the, the test market I think in Atlanta of moist smokeless started last October, its almost the year ago its really has an expanded materially and I just wonder the outside perception is there is a lack of urgency on those types of efforts because you are not moving. It would appear with great speed. So I am just curious about your reaction that observation."

David R. Beran - Executive Vice President and Chief Financial Officer
"Yes, and out of it not characterize it as a lack of urgency, I would characterize it as and we want to make sure that we do this in a financially disciplined way, and when I say financially disciplined that we go out. We have tested all elements of the overall value equation behind both snus and with snuff and we got it completely right, then we won't incorporate that into our plans. And right now, both of those initiatives are investment spent for us and our goal is to take it from investment spend to being, making a profit. But right we are in... these test markets are what I call burning laboratories and make sure we get it right."

Related news brief:Even with poor SNUS sales in the U.S. and Canada - these guys aren't going away...



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