Tobacco, a Killer Investment?

UST Inc.

The Company

UST, through its subsidiaries, is a leading producer and marketer of moist smokeless tobacco products including such brands as: Copenhagen, Skoal, Skoal Long Cut, Skoal Bandits and Skoal Flavor Packs. Other consumer products marketed by UST subsidiaries include premium wines sold nationally through the Chateau Ste. Michelle, Columbia Crest and Villa Mt. Eden wineries as well as sparkling wine produced under the Domaine Ste. Michelle label.

Latest Financials

Despiter the erosion of the company's market share in the smokeless tobacco segment, net earnings for the latest year (1996) increased for the 36th consecutive year rising 8 percent to $464 million. Primary earnings per share rose to $2.42, a 12 percent increase over 1995. Primary earnings per share have increased 49.4 percent over the last three years at an average annual rate of 14.3 percent. In 1996, the Company reclassified its cigar operation from the Tobacco segment to the Other segment since it is part of the Company's international operations which are included in the Other segment. All prior period amounts have been reclassified to conform to the 1996 presentation.

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