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UST Lowers Top End of Earnings Guidance for 2005 at Prudential Equity Group Consumer Conference

Posted on: Wednesday, 7 September 2005, 18:00 CDT

GREENWICH, Conn., Sept. 7 /PRNewswire-FirstCall/ -- Vincent A. Gierer, Jr., chairman and chief executive officer of UST Inc. , and Murray S. Kessler, president of UST's principal operating subsidiary, U.S. Smokeless Tobacco Company, in speaking to institutional shareholders and analysts on Sept. 8, will indicate the company is lowering the top end of its previously announced earnings guidance for 2005 of $3.20 to $3.30 per diluted share to a new range of $3.20 to $3.25 per diluted share. Diluted earnings per share for the third quarter 2005 are expected to be slightly below the prior year's level. The remarks are planned for a presentation at the Prudential Equity Group Consumer Conference to be held in Boston.

The new guidance range is based on lower than originally anticipated shipments of the company's premium moist smokeless tobacco products, partially offset by favorable wine operations, lower income taxes and reduced spending. Although it is too early to assess, there will be a negative impact on can sales due to shipment disruption caused by Hurricane Katrina.

During the conference, the company will restate and support its belief that its overall strategy of accelerating growth in the moist smokeless tobacco category by attracting adult smokers looking for an alternative to cigarettes is working and bodes well for the long-term success of the company. However, the company also will acknowledge that price value competition, exacerbated by escalating gasoline prices, remains a challenge and continues to negatively affect premium moist smokeless tobacco can sale trends. This trend accelerated in late August after the business had rebounded in May, June and July. A number of marketing and promotional initiatives are currently being tested in the marketplace to address the issue and results will be evaluated later in the year. The company anticipates being in a position to give further detail on how these initiatives might impact 2006 plans at its annual analyst meeting in December.

In addition to being webcast live at 11:15 a.m. on Sept. 8, 2005, the presentation will also be archived for later access through the company's website at http://www.ustinc.com/.

UST Inc. is a holding company for its principal subsidiaries: U.S. Smokeless Tobacco Company and International Wine & Spirits Ltd. U.S. Smokeless Tobacco Company is a leading producer and marketer of moist smokeless tobacco products including Copenhagen, Skoal, Red Seal and Husky. Other consumer products marketed by the company include premium wines sold nationally through the Chateau Ste. Michelle, Columbia Crest, Conn Creek and Villa Mt. Eden wineries, as well as sparkling wine produced under the Domaine Ste. Michelle label.

All statements, other than statements of historical facts, which address activities or actions that the company expects or anticipates will or may occur in the future, and other such matters are forward-looking statements. To take advantage of the safe harbor provided by the Private Securities Litigation Reform Act of 1995, the company is identifying certain factors that could cause actual results to differ materially from those expressed in any forward-looking statements made by the company.

Any one, or a combination, of factors could materially affect the results of the company's operations. These factors include competitive pressures, changes in consumer preferences, wholesaler ordering patterns, consumer acceptance of new product introductions and other marketing initiatives, uncertainties associated with ongoing and future litigation, legal and regulatory initiatives (including those described under Items 1 and 3 of the company's most recent Annual Report on Form 10-K, current reports on Form 8-K, and quarterly reports on form 10-Q filed thereafter) and conditions in the capital markets. Forward-looking statements made by the company are based on the knowledge of its business and the environment in which it operates as of the date on which the statements were made. Because of the factors listed above, as well as other factors beyond the control of the company, actual results may differ from those in the forward-looking statements. The company undertakes no duty to update.

UST Inc.

CONTACT: Michael G. Bazinet, Media Relations, +1-203-622-3549, or MarkA. Rozelle, Investor Relations, +1-203-622-3520, both for UST Inc.

Web site: http://www.ustinc.com/

Source: PRNewswire-FirstCall

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