Montego becomes the largest U.S. discount
brand
Third Quarter 2023 Highlights:
- Consolidated revenues of $364.1 million, down 3.7% or $13.9
million compared to the prior year period.
- Tobacco segment wholesale market share declined to 5.3% from
5.7% in the prior year period and retail market share increased to
5.9% from 5.7% in the prior year period.
- Montego wholesale market share increased to 3.5% from 2.8% in
the prior year period and retail market share increased to 3.8%
from 2.8% in the prior year period.
- Operating income of $90.5 million, up 7.9% or $6.6 million
compared to the prior year period.
- Tobacco segment operating income of $94.8 million, up 7.6% or
$6.7 million compared to the prior year period.
- Adjusted EBITDA of $94.9 million, up 8.8% or $7.7 million
compared to the prior year period.
- Tobacco Adjusted EBITDA of $96.3 million, up 7.4% or $6.7
million compared to the prior year period.
Year-to-date 2023 Highlights:
- Consolidated revenues of $1.06 billion, down 1.2% or $13.3
million compared to the prior year period.
- Tobacco segment revenues of $1.06 billion, up 0.2% or $2.6
million compared to the prior year period.
- Tobacco segment wholesale and retail market share increased to
5.5% and 5.8% from 5.4% and 5.4%, respectively, in the prior year
period.
- Montego wholesale market share increased to 3.4% from 2.4% in
the prior year period and retail market share increased to 3.6%
from 2.4% in the prior year period.
- Operating income of $236.4 million, down 5.3% or $13.3
million compared to the prior year period.
- Tobacco segment operating income of $248.5 million, down 2.2%
or $5.5 million compared to the prior year period.
- Adjusted EBITDA of $267.1 million, up 2.9% or $7.6 million
compared to the prior year period.
- Tobacco Adjusted EBITDA of $271.0 million, up 5.6% or $14.4
million compared to the prior year period.
LTM September 30, 2023 Market Share Highlights:
- Tobacco segment wholesale and retail market share increased to
5.5% and 5.8% from 5.1% and 5.2%, respectively, in the last twelve
months ended September 30, 2022.
- Montego wholesale and retail market share increased to 3.3% and
3.5% from 2.0% and 2.0%, respectively, in the last twelve months
ended September 30, 2022.
Vector Group Ltd. (NYSE: VGR) today announced financial results
for the three and nine months ended September 30, 2023.
“We are proud that Montego grew to be the largest discount brand
in the United States in the third quarter of 2023, demonstrating
the strength of our strategy and the skillful execution by Liggett
to offer the best value proposition in the U.S. cigarette
industry,” said Howard M. Lorber, President and Chief Executive
Officer of Vector Group Ltd. “As Liggett continues to outperform
the market, we remain focused on optimizing long-term profit and
driving value for stockholders by effectively managing its volume,
pricing, and market share.”
GAAP Financial Results
Three months ended September 30, 2023 and 2022. Third quarter
2023 revenues were $364.1 million, compared to $378.0 million in
the third quarter of 2022. The Company recorded operating income of
$90.5 million in the third quarter of 2023, compared to $83.9
million in the third quarter of 2022. Net income for the third
quarter of 2023 was $52.7 million, or $0.33 per diluted common
share, compared to $38.9 million, or $0.25 per diluted common
share, in the third quarter of 2022.
Nine months ended September 30, 2023 and 2022. For the nine
months ended September 30, 2023, revenues were $1.06 billion,
compared to $1.08 billion for the nine months ended September 30,
2022. The Company recorded operating income of $236.4 million for
the nine months ended September 30, 2023, compared to $249.7
million for the nine months ended September 30, 2022. Net income
for the nine months ended September 30, 2023 was $125.5 million, or
$0.80 per diluted common share, compared to $110.6 million, or
$0.70 per diluted common share, for the nine months ended September
30, 2022.
Non-GAAP Financial Measures
Three months ended September 30, 2023 compared to the three
months ended September 30, 2022
Adjusted EBITDA (as described in Table 2 attached hereto) were
$94.9 million for the third quarter of 2023, compared to $87.3
million for the third quarter of 2022.
Adjusted Net Income (as described in Table 3 attached hereto)
was $52.0 million, or $0.33 per diluted share, for the third
quarter of 2023, compared to $37.6 million, or $0.24 per diluted
share, for the third quarter of 2022.
Adjusted Operating Income (as described in Table 4 attached
hereto) was $90.5 million for the third quarter of 2023, compared
to $83.9 million for the third quarter of 2022.
Nine months ended September 30, 2023 compared to the nine months
ended September 30, 2022
Adjusted EBITDA (as described in Table 2 attached hereto) were
$267.1 million for the nine months ended September 30, 2023,
compared to $259.5 million for the nine months ended September 30,
2022.
Adjusted Net Income (as described in Table 3 attached hereto)
was $136.8 million, or $0.87 per diluted share, for the nine months
ended September 30, 2023, compared to $104.4 million, or $0.66 per
diluted share, for the nine months ended September 30, 2022.
Adjusted Operating Income (as described in Table 4 attached
hereto) was $254.5 million for the nine months ended September 30,
2023, compared to $247.8 million for the nine months ended
September 30, 2022.
Consolidated Balance Sheet
Vector Group maintained significant liquidity at September 30,
2023 with cash and cash equivalents of $436.5 million, including
$208.0 million of cash from the Tobacco segment, investment
securities of $128.7 million and long-term investments of $45.7
million.
Vector Group continued its longstanding history of paying a
quarterly cash dividend in the third quarter of 2023. For the nine
months ended September 30, 2023, Vector Group returned a total of
$95.3 million to stockholders at a quarterly rate of $0.20 per
common share.
Tobacco Segment Financial Results
For the third quarter of 2023, the Tobacco segment had revenues
of $364.1 million, compared to $378.0 million for the third quarter
of 2022. For the nine months ended September 30, 2023, the Tobacco
segment had revenues of $1.06 billion, compared to $1.06 billion
for the nine months ended September 30, 2022.
Operating Income from the Tobacco segment was $94.8 million and
$248.5 million for the three and for the nine months ended
September 30, 2023, respectively, compared to $88.1 million and
$254.1 million for the three and nine months ended September 30,
2022, respectively.
Non-GAAP Financial Measures
Tobacco Adjusted Operating Income (as described in Table 5
attached hereto) for the third quarter of 2023 was $94.8 million
compared to $88.1 million for the third quarter of 2022. Tobacco
Adjusted Operating Income for the nine months ended September 30,
2023 was $266.6 million, compared to $252.1 million for the nine
months ended September 30, 2022.
Operational Metrics
For the third quarter of 2023, the Tobacco segment had
conventional cigarette (wholesale) shipments of approximately 2.45
billion units, compared to 2.75 billion units for the third quarter
of 2022. For the nine months ended September 30, 2023, the Tobacco
segment had conventional cigarette (wholesale) shipments of
approximately 7.32 billion units, compared to 7.79 billion units
for the nine months ended September 30, 2022.
According to data from Management Science Associates, Inc., for
the third quarter of 2023, the Tobacco segment’s wholesale market
share declined to 5.3%, from 5.7% for the third quarter of 2022.
For the nine months ended September 30, 2023, the Tobacco segment’s
wholesale market share increased to 5.5%, from 5.4% for the nine
months ended September 30, 2022. For the last twelve months ended
September 30, 2023, the Tobacco segment’s wholesale market share
increased to 5.5%, from 5.1% for the twelve months ended September
30, 2022. For the third quarter of 2023, Montego’s wholesale market
share increased to 3.5%, from 2.8% for the third quarter of
2022. For the nine months ended September 30, 2023, Montego’s
wholesale market share increased to 3.4%, from 2.4% for the nine
months ended September 30, 2022. For the twelve months ended
September 30, 2023, Montego’s wholesale market share increased to
3.3%, from 2.0% for the twelve months ended September 30, 2022. The
Tobacco segment’s wholesale shipments in the third quarter of 2023
declined by 10.6% compared to the third quarter of 2022, while the
overall industry’s wholesale shipments declined by 5.3%. The
Tobacco segment’s wholesale shipments for the nine months ended
September 30, 2023 declined by 5.8% compared to the nine months
ended September 30, 2022, while the overall industry’s wholesale
shipments declined by 6.8%. The Tobacco segment’s wholesale
shipments for the last twelve months ended September 30, 2023
declined by 1.1% compared to the last twelve months ended September
30, 2022, while the overall industry’s wholesale shipments declined
by 7.4%.
According to data from Management Science Associates, Inc., for
the third quarter of 2023, the Tobacco segment’s retail market
share increased to 5.9%, from 5.7% for the third quarter of 2022.
For the nine months ended September 30, 2023, the Tobacco segment’s
retail market share increased to 5.8%, from 5.4% for the nine
months ended September 30, 2022. For the last twelve months ended
September 30, 2023, the Tobacco segment’s retail market share
increased to 5.8%, from 5.2% for the twelve months ended September
30, 2022. For the third quarter of 2023, Montego’s retail market
share increased to 3.8%, from 2.8% for the third quarter of
2022. For the nine months ended September 30, 2023, Montego’s
retail market share increased to 3.6%, from 2.4% for the nine
months ended September 30, 2022. For the twelve months ended
September 30, 2023, Montego’s retail market share increased to
3.5%, from 2.0% for the twelve months ended September 30, 2022. The
Tobacco segment’s retail shipments in the third quarter of 2023
declined by 4.7% compared to the third quarter of 2022, while the
overall industry’s retail shipments declined by 8.8%. The Tobacco
segment’s retail shipments for the nine months ended September 30,
2023 declined by 1.8% compared to the nine months ended September
30, 2022, while the overall industry’s retail shipments declined by
8.2%. The Tobacco segment’s retail shipments for the last twelve
months ended September 30, 2023 increased by 2.8% compared to the
last twelve months ended September 30, 2022, while the overall
industry’s wholesale shipments declined by 8.5%.
Non-GAAP Financial Measures
Adjusted EBITDA, Adjusted Net Income, Adjusted Operating Income,
Tobacco Adjusted Operating Income and Tobacco Adjusted EBITDA (the
“Non-GAAP Financial Measures”) are financial measures not prepared
in accordance with generally accepted accounting principles
(“GAAP”). The Company believes that the Non-GAAP Financial Measures
are important measures that supplement discussions and analysis of
its results of operations and enhance an understanding of its
operating performance. The Company believes the Non-GAAP Financial
Measures provide investors and analysts with a useful measure of
operating results unaffected by differences in capital structures
and ages of related assets among otherwise comparable
companies.
Management uses the Non-GAAP Financial Measures as measures to
review and assess operating performance of the Company’s business,
and management does and investors should review both the overall
performance (GAAP net income) and the operating performance (the
Non-GAAP Financial Measures) of the Company’s business. While
management considers the Non-GAAP Financial Measures to be
important, they should be considered in addition to, but not as
substitutes for or superior to, other measures of financial
performance prepared in accordance with GAAP, such as operating
income, net income and cash flows from operations. In addition, the
Non-GAAP Financial Measures are susceptible to varying calculations
and the Company’s measurement of the Non-GAAP Financial Measures
may not be comparable to those of other companies.
Reconciliations of Non-GAAP Financial Measures to the comparable
GAAP financial results for the three and nine months ended
September 30, 2023 and 2022 are included in Tables 2 through 5.
Conference Call to Discuss Third Quarter 2023 Results
As previously announced, the Company will host a conference call
and webcast on Thursday, November 2, 2023 at 8:30 AM (ET) to
discuss its quarterly period and nine months results. Investors may
access the call via live webcast at
https://www.webcaster4.com/Webcast/Page/2271/49284. Please join the
webcast at least ten minutes prior to the start time.
A replay of the call will be available shortly after the call
ends on November 2, 2023 through November 16, 2023 at
https://www.webcaster4.com/Webcast/Page/2271/49284.
About Vector Group Ltd.
Vector Group is a holding company for Liggett Group LLC, Vector
Tobacco LLC, and New Valley LLC. Additional information concerning
the Company is available on the Company’s website,
www.VectorGroupLtd.com.
Investors and others should note that we may post information
about the Company or its subsidiaries on our website at
www.VectorGroupLtd.com and/or at the websites of those subsidiaries
or, if applicable, on their accounts on LinkedIn, Twitter or other
social media platforms. It is possible that the postings or
releases could include information deemed to be material
information. Therefore, we encourage investors, the media and
others interested in the Company to review the information we post
on our website at www.VectorGroupLtd.com, on the websites of our
subsidiaries and on their social media accounts.
Forward-Looking and Cautionary Statements
This press release includes forward-looking statements within
the meaning of the federal securities law. All statements other
than statements of historical or current facts made in this
document are forward-looking. We identify forward-looking
statements in this document by using words or phrases such as
“anticipate,” “believe,” “estimate,” “expect,” “intend,” “may be,”
“continue,” “could,” “potential,” “objective,” “plan,” “seek,”
“predict,” “project” and “will be” and similar words or phrases or
their negatives. Forward-looking statements reflect our current
expectations and are inherently uncertain. Actual results could
differ materially for a variety of reasons.
Risks and uncertainties that could cause our actual results to
differ significantly from our current expectations are described in
our 2022 Annual Report on Form 10-K and, when filed, in our
Quarterly Report on Form 10-Q for the quarter ended September 30,
2023. We undertake no responsibility to publicly update or revise
any forward-looking statement except as required by applicable
law.
[Financial Tables Follow]
TABLE 1
VECTOR GROUP LTD. AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
OPERATIONS
(Unaudited)
(Dollars
in Thousands, Except Per Share Amounts)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2023
2022
2023
2022
Revenues:
Tobacco*
$
364,111
$
377,995
$
1,063,918
$
1,061,355
Real estate
—
—
—
15,884
Total revenues
364,111
377,995
1,063,918
1,077,239
Expenses:
Cost of sales:
Tobacco*
245,680
267,023
726,950
743,749
Real estate
—
—
—
7,327
Total cost of sales
245,680
267,023
726,950
751,076
Operating, selling, administrative and
general expenses
27,512
27,040
81,734
76,265
Litigation settlement and judgment
expense
414
31
18,789
160
Operating income
90,505
83,901
236,445
249,738
Other income (expenses):
Interest expense
(27,256
)
(27,598
)
(81,854
)
(83,420
)
Gain (loss) on extinguishment of debt
—
412
(181
)
412
Equity in losses from investments
(941
)
(619
)
(141
)
(5,172
)
Equity in earnings (losses) from real
estate ventures
3,739
(1,903
)
4,800
(4,240
)
Other, net
7,107
(804
)
15,518
(5,043
)
Income before provision for income
taxes
73,154
53,389
174,587
152,275
Income tax expense
20,455
14,533
49,058
41,724
Net income
$
52,699
$
38,856
$
125,529
$
110,551
Per basic common share:
Net income applicable to common shares
$
0.33
$
0.25
$
0.80
$
0.70
Per diluted common share:
Net income applicable to common shares
$
0.33
$
0.25
$
0.80
$
0.70
* Revenues and cost of sales include
federal excise taxes of $122,943, $138,041, $367,511 and $392,004
for the three and nine months ended September 30, 2023 and 2022,
respectively.
TABLE 2
VECTOR GROUP LTD. AND
SUBSIDIARIES
RECONCILIATION OF ADJUSTED
EBITDA
(Unaudited)
(Dollars
in Thousands)
LTM
Year Ended
Three Months Ended
Nine Months Ended
September 30,
December 31,
September 30,
September 30,
2023
2022
2023
2022
2023
2022
Net income
$
173,679
$
158,701
$
52,699
$
38,856
$
125,529
$
110,551
Interest expense
109,099
110,665
27,256
27,598
81,854
83,420
Income tax expense
69,195
61,861
20,455
14,533
49,058
41,724
Depreciation and amortization
6,973
7,218
1,762
1,787
5,185
5,430
EBITDA
$
358,946
$
338,445
$
102,172
$
82,774
$
261,626
$
241,125
Equity in (earnings) losses from
investments (a)
(36
)
4,995
941
619
141
5,172
Equity in (earnings) losses from real
estate ventures (b)
(3,094
)
5,946
(3,739
)
1,903
(4,800
)
4,240
Loss (gain) on extinguishment of debt
181
(412
)
—
(412
)
181
(412
)
Stock-based compensation expense (c)
8,997
7,848
2,674
1,558
7,424
6,275
Litigation settlement and judgment expense
(d)
18,868
239
414
31
18,789
160
Impact of MSA settlement (e)
(734
)
(2,123
)
(423
)
—
(734
)
(2,123
)
Other, net
(23,307
)
(2,746
)
(7,107
)
804
(15,518
)
5,043
Adjusted EBITDA
$
359,821
$
352,192
$
94,932
$
87,277
$
267,109
$
259,480
Adjusted EBITDA by Segment
Tobacco
$
365,490
$
351,131
$
96,301
$
89,632
$
270,950
$
256,591
Real Estate
471
8,082
84
(3
)
294
7,905
Corporate and Other
(6,140
)
(7,021
)
(1,453
)
(2,352
)
(4,135
)
(5,016
)
Total
$
359,821
$
352,192
$
94,932
$
87,277
$
267,109
$
259,480
________________
a. Represents equity in (earnings) losses recognized
from investments that the Company accounts for under the equity
method.
b. Represents equity in (earnings) losses recognized from the
Company’s investment in certain real estate ventures that are
accounted for under the equity method and are not consolidated in
the Company’s financial results.
c. Represents amortization of stock-based compensation.
d. Represents accruals for litigation in the Tobacco
segment.
e. Represents the Tobacco segment’s settlement of long-standing
disputes related to the Master Settlement Agreement.
TABLE 3
VECTOR GROUP LTD. AND
SUBSIDIARIES
RECONCILIATION OF ADJUSTED NET
INCOME
(Unaudited)
(Dollars
in Thousands, Except Per Share Amounts)
Three Months Ended
Nine Months Ended
September 30,
September 30,
2023
2022
2023
2022
Net income
$
52,699
$
38,856
$
125,529
$
110,551
(Gain) loss on extinguishment of debt
—
(412
)
181
(412
)
Litigation settlement and judgment expense
(a)
414
31
18,789
160
Impact of MSA settlement (b)
(423
)
—
(734
)
(2,123
)
Impact of net interest expense capitalized
to real estate ventures
(930
)
(1,081
)
(3,043
)
(3,092
)
Expense related to Tax Disaffiliation
indemnification (c)
—
28
—
581
Adjustment for derivative associated with
guarantee
—
(182
)
—
(2,646
)
Total adjustments
(939
)
(1,616
)
15,193
(7,532
)
Tax expense (benefit) related to
adjustments
243
377
(3,921
)
1,411
Adjusted Net Income
$
52,003
$
37,617
$
136,801
$
104,430
Per diluted common share:
Adjusted Net Income applicable to common
shares
$
0.33
$
0.24
$
0.87
$
0.66
________________
a. Represents accruals for litigation in the Tobacco
segment.
b. Represents the Tobacco segment’s settlement of long-standing
disputes related to the Master Settlement Agreement.
c. Represents amounts accrued under the Company’s Tax
Disaffiliation Agreement related to certain tax liabilities of
Douglas Elliman Inc. prior to its distribution on December 29,
2021.
TABLE 4
VECTOR GROUP LTD. AND
SUBSIDIARIES
RECONCILIATION OF ADJUSTED
OPERATING INCOME
(Unaudited)
(Dollars
in Thousands)
LTM
Year Ended
Three Months Ended
Nine Months Ended
September 30,
December 31,
September 30,
September 30,
2023
2022
2023
2022
2023
2022
Operating income
$
325,717
$
339,010
$
90,505
$
83,901
$
236,445
$
249,738
Litigation settlement and judgment expense
(a)
18,868
239
414
31
18,789
160
Impact of MSA settlement (b)
(734
)
(2,123
)
(423
)
—
(734
)
(2,123
)
Total adjustments
18,134
(1,884
)
(9
)
31
18,055
(1,963
)
Adjusted Operating Income
$
343,851
$
337,126
$
90,496
$
83,932
$
254,500
$
247,775
________________
a. Represents accruals for litigation in the Tobacco
segment.
b. Represents the Tobacco segment’s settlement of long-standing
disputes related to the Master Settlement Agreement.
TABLE 5
VECTOR GROUP LTD. AND
SUBSIDIARIES
RECONCILIATION OF TOBACCO
ADJUSTED OPERATING INCOME
AND TOBACCO ADJUSTED
EBITDA
(Unaudited)
(Dollars
in Thousands)
LTM
Year Ended
Three Months Ended
Nine Months Ended
September 30,
December 31,
September 30,
September 30,
2023
2022
2023
2022
2023
2022
Tobacco Adjusted Operating
Income:
Operating income from Tobacco segment
$
341,508
$
347,044
$
94,821
$
88,107
$
248,542
$
254,078
Litigation settlement and judgment expense
(a)
18,868
239
414
31
18,789
160
Impact of MSA settlement (b)
(734
)
(2,123
)
(423
)
—
(734
)
(2,123
)
Total adjustments
18,134
(1,884
)
(9
)
31
18,055
(1,963
)
Tobacco Adjusted Operating Income
$
359,642
$
345,160
$
94,812
$
88,138
$
266,597
$
252,115
LTM
Year Ended
Three Months Ended
Nine Months Ended
September 30,
December 31,
September 30,
September 30,
2023
2022
2023
2022
2023
2022
Tobacco Adjusted EBITDA:
Operating income from Tobacco segment
$
341,508
$
347,044
$
94,821
$
88,107
$
248,542
$
254,078
Litigation settlement and judgment expense
(a)
18,868
239
414
31
18,789
160
Impact of MSA settlement (b)
(734
)
(2,123
)
(423
)
—
(734
)
(2,123
)
Total adjustments
18,134
(1,884
)
(9
)
31
18,055
(1,963
)
Tobacco Adjusted Operating Income
359,642
345,160
94,812
88,138
266,597
252,115
Depreciation and amortization
5,718
5,901
1,447
1,474
4,243
4,426
Stock-based compensation expense
130
70
42
20
110
50
Total adjustments
5,848
5,971
1,489
1,494
4,353
4,476
Tobacco Adjusted EBITDA
$
365,490
$
351,131
$
96,301
$
89,632
$
270,950
$
256,591
________________
- Represents accruals for litigation in the
Tobacco segment.
- Represents the Tobacco segment’s
settlement of long-standing disputes related to the Master
Settlement Agreement.
TABLE 6
VECTOR GROUP LTD. AND
SUBSIDIARIES
RECONCILIATION OF
REVENUES
(Unaudited)
(Dollars
in Thousands)
LTM
Year Ended
Three Months Ended
Nine Months Ended
September 30,
December 31,
September 30,
September 30,
2023
2022
2023
2022
2023
2022
Revenues:
Tobacco (a)
$
1,427,688
$
1,425,125
$
364,111
$
377,995
$
1,063,918
$
1,061,355
Real estate
—
15,884
—
—
—
15,884
Total revenues
$
1,427,688
$
1,441,009
$
364,111
$
377,995
$
1,063,918
$
1,077,239
________________
- Tobacco segment revenues include federal excise taxes of
$496,267 for the last twelve months ended September 30, 2023,
$520,760 for the year ended December 31, 2022, and $122,943,
$138,041, $367,511, and $392,004 for the three months ended
September 30, 2023 and 2022 and the nine months ended September 30,
2023 and 2022, respectively.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231031218949/en/
FGS Global 212-687-8080 (U.S.) VectorGroupIR@fgsglobal.com J.
Bryant Kirkland III, Vector Group Ltd. 305-579-8000
Vector (NYSE:VGR)
Gráfico Histórico do Ativo
De Abr 2024 até Mai 2024
Vector (NYSE:VGR)
Gráfico Histórico do Ativo
De Mai 2023 até Mai 2024