Altria, the world’s largest tobacco company, has begun to enjoy cigars. Is it a sign of the future? The owner of Marlboro, L&M, Parliament and Virginia Slims brands announced that it would buy John Middleton, Inc., makers of Black & Mild cigars for $2.9 billion in cash.
Middleton’s operating revenues are expected to reach $360 million on sales of 1.2 billion cigars. Its net income is expected to be about $182 million for a profit margin of 50.6 percent. Black & Mild has 23 percent of the U.S. machine-made cigar market, estimated at 5.3 billion units annually. A lot more than the handmade cigars, wich is only about 300 million units a year. The brand is the second-largest-selling brand in the category (Swisher Sweets is the leader).
