Altria sets Philip Morris spinoff date

NEW YORK (Reuters) - Altria Group Inc MO.N posted a 26 percent decline in quarterly earnings on Wednesday due to the spinoff last year of Kraft Foods, and set March 28 as the date for its planned spinoff of Philip Morris International.

An Altria office is seen in a handout photo. REUTERS/Altria/Handout

The maker of Marlboro cigarettes also said it plans to repurchase $7.5 billion of its stock over two years, beginning in April.

Stock repurchases have long been expected by analysts in conjunction with the separation of the international tobacco business, which authorized its own $13.0 billion share buyback program, expected to begin in early May.

Altria also said it will soon commence a tender offer and consent solicitation to purchase all of its outstanding notes, including $2.6 billion of dollar-denominated notes and 1.0 billion of euro-denominated notes.

Fourth-quarter net profit for Altria was $2.19 billion, or $1.03 per share, down from $2.96 billion, or $1.40 a share, a year earlier.

Quarterly net revenue rose to $18.23 billion from $16.03 billion.

Altria has been able to increase prices to help boost its U.S. business, while the weak dollar has helped lift sales in its international operations.

But investors have been waiting for details about the spinoff of Philip Morris International and share buybacks.

Altria forecast that 2008 earnings from continuing operations would grow 9 percent to 11 percent, to between $1.63 and $1.67 per share, excluding Philip Morris International, which will be accounted for as a discontinued operation.

The forecast reflects a higher tax rate, the contribution of income from a recent acquisition, and the impact of share repurchases.

On its own, Philip Morris International sees 2008 earnings from continuing operations growing 12 percent to 14 percent at current exchange rates, to between $3.11 and $3.17 per share.

Reporting by Martinne Geller; editing by John Wallace