Altria Group Inc. (NYSE:MO)

The analysis of the intangible assets over the five-year period reveals several notable trends in their valuation and composition.

Goodwill

The value of goodwill remained steady at $5,177 million from 2019 through 2022, before experiencing a significant increase to $6,791 million in 2023. This uptick suggests a likely acquisition or revaluation event that increased the company's recognized goodwill.

Indefinite-lived intangible assets

These assets showed remarkable stability from 2019 to 2023, holding relatively constant values at approximately $11,443 to $11,676 million, with a slight decline starting in 2021 that maintained until 2023. This pattern suggests minimal disposals or impairments in this category over time.

Definite-lived intangible assets (gross carrying amount)

The gross carrying amount of definite-lived intangible assets was relatively flat from 2019 to 2021 around $1,260 to $1,275 million. In 2022, there was a modest increase to $1,411 million, followed by a substantial rise to $2,841 million in 2023. This considerable growth indicates increased investment or acquisitions of definite-lived assets in the latest year.

Accumulated amortization

Accumulated amortization showed a consistent increase in its absolute value, moving from -$264 million in 2019 to -$598 million in 2023. This trend aligns with the aging and systematic amortization of the definite-lived intangible assets on the balance sheet.

Definite-lived intangible assets (net)

Net definite-lived intangible assets declined gradually from $1,011 million in 2019 to $863 million in 2021, reflecting amortization outpacing additions during this period. In 2022, a slight recovery to $941 million was observed, followed by a sharp increase to $2,243 million in 2023, influenced by the significant rise in gross amounts and accumulation of amortization.

Other intangible assets (net)

The net value of other intangible assets showed a gradual decrease from $12,687 million in 2019 to $12,306 million in 2021. It stabilized around $12,384 million in 2022 and then increased to $13,686 million in 2023. This pattern indicates relative stability with a renewed increase in the most recent period.

Goodwill and other intangible assets (net)

The aggregate net value of goodwill and other intangible assets followed a downward trend from $17,864 million in 2019 to $17,483 million in 2021, with minor fluctuations thereafter. It rose modestly to $17,561 million in 2022 before ascending more noticeably to $20,477 million in 2023. This overall increase is primarily driven by the jump in goodwill and definite-lived intangible assets.

In summary, the data reflects a period of stability in intangible asset values up until 2021, followed by significant growth in 2023, particularly in goodwill and definite-lived intangible assets. The consistent increase in accumulated amortization demonstrates active amortization of definite-lived assets. The overall pattern suggests recent strategic activities such as acquisitions or revaluations contributing to the increase in intangible asset base.

Total Assets

The reported total assets demonstrate a clear downward trend from US$49,271 million in 2019 to US$38,570 million in 2023, reflecting a notable reduction over the five-year period. Adjusted total assets, which exclude goodwill, follow a similar pattern, decreasing from US$44,094 million to US$31,779 million over the same timeframe. This consistent decline in both reported and adjusted totals suggests a contraction in the asset base, potentially due to divestitures, asset impairments, or strategic changes in the asset portfolio.

Stockholders’ Equity

Reported stockholders’ equity attributable to the company declines sharply from US$6,222 million in 2019 to negative US$3,540 million in 2023, indicating a transition from positive equity to a deficit position. Adjusted stockholders’ equity, which removes goodwill effects, starts at a substantially lower base of US$1,045 million in 2019 and deteriorates further to a deficit of US$10,331 million by 2023. The widening negative equity, observed more severely in the adjusted figures, suggests persistent losses, write-downs, or other charges undermining the equity base, raising concerns about the company’s financial stability and solvency.

Net Earnings

Net earnings attributable to the company show a significant improvement and a strong upward trend across the period. Both reported and adjusted net earnings align closely, beginning with a loss of approximately US$1,219 million to US$1,293 million in 2019, followed by consistent profitability from 2020 onwards, reaching US$8,130 million in 2023. This positive trajectory in earnings indicates an operational recovery or improved profitability, despite the declining asset base and worsening equity position noted earlier.

Overall Insights

The data presents a complex financial profile: while the company has succeeded in turning losses into increasing profits since 2019, this has not translated into improved asset or equity positions, both of which have deteriorated substantially. The growing negative adjusted equity highlights risks concerning asset quality and goodwill impairments that affect the balance sheet strength. Profitability gains may reflect operational efficiencies or market factors, but the shrinking asset base and equity deficits suggest underlying challenges requiring close monitoring, particularly in the context of long-term financial health and capital structure.

Net Profit Margin

The reported net profit margin experienced considerable fluctuations from 2019 to 2023. Starting with a negative margin of -5.15% in 2019, it improved markedly to 17.08% in 2020, then declined to 9.51% in 2021, before rising sharply to 22.97% in 2022 and further to 33.21% in 2023. The adjusted net profit margin follows the exact same pattern and values, indicating consistent adjustments related to goodwill had no impact on this metric.

Total Asset Turnover

The reported total asset turnover ratio showed a gradual upward trend from 0.51 in 2019 to a peak of 0.68 in 2022, followed by a slight decrease to 0.63 in 2023. The adjusted total asset turnover displays a higher ratio at each corresponding period, starting at 0.57 in 2019 and reaching 0.79 in 2022 before a minor decline to 0.77 in 2023. This suggests that asset utilization efficiency improved over the years, especially after adjustments.

Financial Leverage

Reported financial leverage showed a significant increase from 7.92 in 2019 to 16.7 in 2020. However, data for subsequent years is missing. The adjusted financial leverage is notably higher at 42.2 in 2019, with no data available for later years. The higher adjusted leverage figure implies a substantial impact of goodwill adjustments on this ratio, potentially indicating a considerable amount of intangible assets influencing leverage.

Return on Equity (ROE)

Reported ROE demonstrated extreme volatility, beginning at a negative -20.78% in 2019, surging to 157.34% in 2020, with no further data available for subsequent years. Adjusted ROE was even more negative at -116.65% in 2019, with no later year data provided. The disparity between reported and adjusted ROE in 2019 suggests significant goodwill or other adjustments affecting equity returns during that period.

Return on Assets (ROA)

Reported ROA improved consistently from a negative -2.62% in 2019 to 9.42% in 2020, dipped to 6.26% in 2021, then rose substantially to 15.6% in 2022 and 21.08% in 2023. Adjusted ROA mirrors this trend but at slightly different levels—starting at -2.76% in 2019, increasing to 10.58% in 2020, then 7.21% in 2021, followed by a more pronounced rise to 18.14% in 2022 and 25.58% in 2023. The adjusted figures consistently show higher returns, indicating that adjustments, likely related to goodwill, enhance apparent asset profitability.

The financial data reveals significant fluctuations and an overall improving trend in the profitability of the company over the five-year period. Both reported and adjusted net earnings show a similar pattern, indicating consistency between the reported figures and the adjustments made for goodwill.

Net Earnings (Losses) Attributable to the Company

The company experienced a substantial loss in 2019, with reported and adjusted net earnings both approximately -$1.29 billion and -$1.22 billion respectively. However, starting in 2020, earnings turned positive and showed progressive growth each year thereafter. From $4.47 billion in 2020, the earnings decreased slightly to $2.48 billion in 2021 but rebounded significantly to $5.76 billion in 2022. This upward trajectory culminated in a peak of $8.13 billion by the end of 2023, indicating strong recovery and growth in profitability.

Net Profit Margin Trends

The net profit margin mirrors the pattern seen in earnings. In 2019, the margin was negative at approximately -5%, which corresponds to the loss incurred that year. Starting in 2020, the margin increased substantially to over 17%, reflecting improved profitability. Although the margin dipped to roughly 9.5% in 2021, it surged again in the subsequent years, reaching nearly 23% in 2022 and then escalating to 33.21% in 2023. This trend suggests enhanced operational efficiency and better cost management, contributing to higher profitability ratios.

Comparison Between Reported and Adjusted Figures

The alignment between reported and adjusted figures across net earnings and net profit margins suggests that goodwill adjustments did not materially affect profitability metrics during these periods. This consistency enhances the reliability of the reported data for performance analysis and strategic decision-making.

In summary, the data depicts a strong turnaround from losses in 2019 to robust profitability in 2023, with steadily improving margins supporting the positive earnings trend. The fluctuations in 2021 indicate some volatility, but the overall direction is favorable, signaling effective recovery and growth strategies implemented by the company.

The analysis of the reported and goodwill adjusted financial data over the five-year period reveals several noteworthy trends in the company's asset management and efficiency metrics.

Total Assets

The reported total assets demonstrate a declining trend, decreasing from $49,271 million in 2019 to $38,570 million in 2023. This represents an overall reduction in asset base of approximately 21.7% over the five years. The adjusted total assets, which exclude goodwill, show a similar pattern, falling from $44,094 million to $31,779 million in the same period, indicating a 27.9% decrease. The consistent decline in both reported and adjusted total assets suggests a contraction in asset holdings or possible divestitures during this timeframe.

Total Asset Turnover

The reported total asset turnover has improved from 0.51 in 2019 to a peak of 0.68 in 2022 before slightly retreating to 0.63 in 2023. This indicates enhanced efficiency in generating revenues from the assets held up to 2022, with a mild reversal thereafter. Similarly, the adjusted total asset turnover shows a rising trend from 0.57 in 2019 to 0.79 in 2022, followed by a small decline to 0.77 in 2023. The higher turnover ratios on an adjusted basis reflect better operational performance when excluding goodwill, emphasizing more effective utilization of tangible and intangible assets other than goodwill over the period.

Comparative Insights

Comparing reported and adjusted figures reveals that the exclusion of goodwill results in consistently higher asset turnover ratios, suggesting that goodwill may not contribute directly to revenue generation efficiency. The trends display a steady improvement in asset utilization up to 2022, which implies strategic enhancements or operational improvements during these years. The slight downturn in 2023 turnover ratios, despite stable adjusted total assets, could indicate emerging challenges in asset productivity or changes in revenue dynamics.

Overall Conclusion

The data indicate a deliberate downsizing or optimization of the asset base coupled with increasing efficiency in asset usage through most of the analyzed period. The peak in asset turnover ratios in 2022 signifies optimal asset utilization, while the subsequent minor decline may warrant further monitoring to identify underlying causes. The distinction between reported and adjusted figures underlines the importance of excluding non-productive goodwill to better assess operational efficiency.

The financial data reveals a clear downward trend in the total assets of the company over the five-year period. Reported total assets declined steadily from US$49,271 million in 2019 to US$38,570 million in 2023. Similarly, adjusted total assets, which presumably exclude goodwill, follow the same trajectory, decreasing from US$44,094 million in 2019 to approximately US$31,779 million in 2023. This indicates an overall contraction in the asset base, with the adjusted values consistently lower than the reported figures, highlighting the impact of goodwill adjustments.

Stockholders' equity attributable to the company presents a concerning pattern, with reported equity decreasing sharply from US$6,222 million in 2019 to negative US$3,540 million in 2023. This represents a significant erosion of shareholder value, transferring into a deficit position by 2021 and continuing to deteriorate through 2023. The adjusted stockholders’ equity exhibits an even more pronounced decline, starting at US$1,045 million in 2019 and reaching a negative US$10,331 million in 2023. The deeper deficit in adjusted equity suggests that goodwill adjustments significantly exacerbate the negative equity scenario.

Financial leverage, expressed as a ratio, shows elevated and variable levels in the initial years reported. Reported financial leverage escalated from 7.92 in 2019 to 16.7 in 2020, with no further data for subsequent years. The adjusted financial leverage is distinctly higher at 42.2 in 2019, reflecting the magnified risk when considering adjusted equity figures. The absence of reported leverage data beyond 2020 limits a full trend analysis, but the available figures point to a high and potentially increasing reliance on debt relative to equity in earlier periods.

Overall, the data reflects a period of financial strain, characterized by shrinking asset bases and increasing shareholder equity deficits, with the adjusted figures highlighting the deleterious effects of goodwill on the company’s financial structure. The elevated financial leverage ratios further emphasize the company’s substantial indebtedness, underscoring potential risks in its capital structure.

Total Assets

Declined consistently over five years, with adjusted values below reported, indicating goodwill adjustments.

Stockholders' Equity

Shifted from positive to significant negative, with adjusted figures showing deeper deficits.

Financial Leverage

Reported leverage increased markedly by 2020, adjusted leverage was substantially higher, illustrating heightened financial risk.

The financial data reveals significant fluctuations in key performance metrics for Altria Group Inc. over the five-year period ending December 31, 2023. The reported net earnings attributable to the company show a substantial turnaround from a loss of US$ 1,293 million in 2019 to positive earnings reaching US$ 8,130 million in 2023. This upward trajectory is also mirrored in the adjusted net earnings figures, indicating consistent improvement in profitability after adjustments.

Despite the improvements in net earnings, the stockholders’ equity attributable to Altria exhibits a contrasting trend. Reported stockholders’ equity decreased markedly from US$ 6,222 million in 2019 to a deficit of US$ 3,540 million by the end of 2023, indicating a deterioration in net asset value under reported measures. The adjusted stockholders’ equity figures depict an even more pronounced decline into negative territory, dropping from US$ 1,045 million in 2019 to a deficit exceeding US$ 10,300 million in 2023. This suggests that adjustments, possibly related to goodwill or other accounting considerations, have contributed to highlighting weaknesses in the capital base or balance sheet stability.

Return on equity (ROE) metrics further illustrate the volatility in financial performance. The reported ROE was highly negative at -20.78% in 2019 but swung dramatically to an exceptionally high positive figure of 157.34% in 2020; data for subsequent years is not provided. The adjusted ROE was considerably negative at -116.65% in 2019, with no further data available. Such fluctuations indicate significant leverage and potential volatility in earnings relative to shareholders’ equity, especially when differences between reported and adjusted measures are considered.

Overall, while net earnings have increased significantly and consistently, signaling improved operational performance or profitability, the deterioration in both reported and adjusted stockholders’ equity points to underlying concerns regarding financial structure, asset valuations, or balance sheet impairments. The disparities between reported and adjusted equity values emphasize the impact of accounting adjustments on perceived financial health. The highly variable ROE figures reflect underlying volatility in returns to shareholders, underscoring the complex financial dynamics facing the company during this period.

Net Earnings (Losses) Attributable to Altria

There was a significant improvement in net earnings from a loss of approximately $1.29 billion in 2019 to positive earnings in 2020, reaching about $4.47 billion. Although a decline occurred in 2021 to roughly $2.48 billion, earnings rebounded strongly in 2022 and 2023, reaching $5.76 billion and $8.13 billion, respectively, indicating a strong upward trend in profitability over the five-year period.

Adjusted Net Earnings

The adjusted net earnings exhibit the same trend and values as the reported net earnings, suggesting that goodwill adjustments had minimal impact on reported profitability figures across the analyzed periods.

Total Assets

The reported total assets decreased consistently from approximately $49.27 billion in 2019 to about $38.57 billion in 2023. Similarly, adjusted total assets declined from $44.09 billion to roughly $31.78 billion over the same span. The adjusted assets are consistently lower than the reported figures, indicating adjustments likely related to goodwill or other intangible assets. Overall, the asset base contracted steadily across the five years.

Return on Assets (ROA)

Both reported and adjusted ROA show a notable positive trend after 2019, when ROA was negative (-2.62% reported and -2.76% adjusted). Reported ROA rose to 9.42% in 2020, dipped somewhat to 6.26% in 2021, and then increased substantially to 15.6% in 2022 and 21.08% in 2023. Adjusted ROA follows a similar but slightly higher trajectory: 10.58% in 2020, 7.21% in 2021, 18.14% in 2022, and 25.58% in 2023. This reflects improving efficiency and profitability of asset utilization over time.

Overall Insights

The financial data presents a clear recovery from a loss in 2019 to growing profitability through 2023. The steady decline in total assets, both reported and adjusted, alongside rising ROA suggests the company may be optimizing asset usage and focusing on operational efficiency. The alignment of adjusted financial metrics with reported figures implies limited effect of goodwill on earnings and assets during this timeframe.