Second-Quarter Reported Diluted EPS grew
52.5% to $1.54 Adjusted Diluted EPS decreased by 0.6% to
$1.59; and grew by 10.6% excluding currency
Regulatory News:
Philip Morris International Inc. (PMI) (NYSE: PM) today
announces its 2024 second-quarter and first-half results.1
“The excellent momentum of our smoke-free business continued
with an outstanding second-quarter and first-half performance,”
said Jacek Olczak, Chief Executive Officer.
“The powerful combination of excellent underlying performance
and proactive measures across all categories enabled our business
to outperform once again, and we are on track for a strong 2024. As
a result, we are raising our full-year guidance, despite currency
headwinds.”
Second Quarter
Highlights
- Smoke-free business (SFB): The smoke-free business
accounted for 38.1% of our total net revenues (up by 2.7pp versus
second-quarter last year), with 36.5 million estimated adult users
of our smoke-free products (up by 3.2 million versus December
2023), which are available in 90 markets. Our SFB continues to
deliver superior performance, with net revenues increasing by 13.6%
(18.3% organically) and gross profit increasing by 15.6% (22.2%
organically).
- Inhalable smoke-free products (SFP): Total IQOS users at
quarter-end were estimated at 30.8 million (up by 1.9 million
versus December 2023), of which approximately 22.1 million had
fully switched to IQOS and stopped smoking. The increase was
broad-based, with notable gains in Japan following the launch of
ILUMA i, as well as good progress in Europe (especially Greece,
Hungary, Romania, Bulgaria, and Spain), South Korea, and low and
middle income markets, notably Indonesia. Market share for HTUs in
IQOS markets was up by 0.7pp to 8.1%. HTU adjusted in-market sales
(IMS) volume, which excludes the net impact of estimated
distributor and wholesaler inventory movements was up by an
estimated 10.2%, in line with expectations.
- In Japan, IQOS HTU market share increased by more than 3
percentage points to over 29%, and offtake share exceeded 30% for
the first time in June. TEREA and SENTIA were the #1 and #3
nicotine brands respectively in the quarter. Adjusted IMS grew by
12.5%, the 7th consecutive quarter of double-digit growth.
- In Europe, IQOS HTU adjusted market share increased by 0.8pp to
9.8% with adjusted IMS growth of 6.8%, which, as expected, was
impacted by the EU characterizing flavor ban, especially in
Italy.
In the vaping category, our focused strategy
is showing promising early results, with VEEV taking the #1
position in the closed pod segment in 5 European markets within 12
months of launch.
- Oral SFP2: Shipment volume increased by 23.5% in cans
(20.0% in pouches or pouch equivalents), fueled by ZYN nicotine
pouch growth in the U.S., where shipments reached 135.1 million
cans, representing growth of 50.3% versus prior year. ZYN, despite
supply constraints, performed in-line with the U.S. nicotine pouch
category in terms of consumer offtake. Outside of the U.S., our
nicotine pouch volume grew by over 50% with promising results in a
number of new markets, notably Pakistan.
- Combustibles: Net revenues grew by 1.2% (organically by
4.8%), driven by another quarter of high single-digit pricing and
resilient industry volumes. After 7 consecutive quarters of gross
margin contraction, profitability recovered in Q2 with very robust
expansion of 40 bps (50 bps on an organic basis), primarily driven
by pricing.
- Dividend: We declared a regular quarterly dividend of
$1.30 per share, or an annualized $5.20 per share.
__________________________ 1 Explanation of PMI's use of
non-GAAP measures cited in this document and reconciliations to the
most directly comparable U.S. GAAP measures can be found in the
“Non-GAAP Measures, Glossary and Explanatory Notes” section of this
release, in Exhibit 99.2 to the company's Form 8-K dated July 23,
2024, and at www.pmi.com/2024Q2earnings. 2 Oral smoke-free products
volume excludes snuff, snuff leaf and U.S. chew
Operating Review - Second
Quarter
Total
HTU
Oral SFP3
Cigarettes
Shipment Volume (units bn)
197.3
35.5
4.2
157.6
vs. Q2 2023
2.8%
13.1%
20.0%
0.4%
PMI
Smoke-Free
Business
Combustibles
Net Revenues ($ bn)
$9.5
$3.6
$5.9
reported vs. Q2 2023
5.6%
13.6%
1.2%
organic vs. Q2 2023
9.6%
18.3%
4.8%
Gross Profit ($ bn)
$6.1
$2.3
$3.8
reported vs. Q2 2023
6.7%
15.6%
1.8%
organic vs. Q2 2023
11.5%
22.2%
5.5%
Operating Income ($ bn)
$3.4
reported vs. Q2 2023
34.2%
organic vs. Q2 2023
12.5%
Reported
Diluted
EPS
Adjusting
Items*
Adjusted
Diluted
EPS
Currency
Impact
Adjusted
Diluted
EPS ex. Currency
EPS
$1.54
$(0.05)
$1.59
$(0.18)
$1.77
vs. Q2 2023
52.5%
(0.6)%
10.6%
(*) For a list of adjusting items refer to
page 19
__________________________ 3 In pouches or pouch equivalents
Full-Year Forecast
Full-Year
2024
Forecast
2023
Growth
Reported Diluted EPS
$5.89
-
$6.01
$ 5.02
Adjustments:
Asset impairment and exit costs
0.09
0.06
Termination of distribution arrangement in
the Middle East
—
0.04
Impairment of goodwill and other
intangibles
0.01
0.44
Amortization of intangibles(1)
0.43
0.25
Charges related to the war in Ukraine
—
0.03
Swedish Match AB acquisition accounting
related items
—
0.01
Income tax impact associated with Swedish
Match AB financing
0.09
(0.11)
South Korea indirect tax charge
—
0.11
Termination of agreement with Foundation
for a Smoke-Free World
—
0.07
Fair value adjustment for equity security
investments
(0.15)
(0.02)
Tax items
(0.03)
0.11
Total Adjustments
0.44
0.99
Adjusted Diluted EPS
$6.33
-
$6.45
$ 6.01
5.3%
-
7.3%
Less: Currency
(0.34)
Adjusted Diluted EPS, excluding
currency
$6.67
-
$6.79
$ 6.01
11.0%
-
13.0%
(1) See forecast assumptions for
details
Reported diluted EPS is forecast to be in a range of $5.89 to
$6.01, at prevailing exchange rates, versus reported diluted EPS of
$5.02 in 2023. Excluding a total 2024 adjustment of $0.44 per
share, this forecast represents a projected increase of 5.3% to
7.3% versus adjusted diluted EPS of $ 6.01 in 2023. Also excluding
an adverse currency impact of $0.34, at prevailing exchange rates,
this forecast represents a projected increase of 11.0% to 13.0%
versus adjusted diluted EPS of $6.01 in 2023, as outlined in the
above table.
2024 Full-Year Forecast Assumptions
This forecast assumes:
- A broadly stable total international industry volume for
cigarettes and HTUs, excluding China and the U.S.;
- Total cigarette, HTU and oral smoke-free product shipment
volume growth for PMI of 1% to 2% driven by smoke-free
products;
- A second half acceleration in HTU adjusted IMS to deliver
around 13% growth for the full year, and HTU shipment volumes of
around 140 billion units. This assumes no volumes in Taiwan and a
slightly greater impact from consumer adjustment to the EU
characterizing flavor ban than previously assumed;
- Nicotine pouch shipment volume in the U.S. of 560 to 580
million cans;
- Net revenue growth of 7.5% to 9% on an organic basis;
- Organic operating income growth of 11% to 13%;
- An acceleration in organic smoke-free net revenue and gross
profit growth compared to 2023;
- Broadly unchanged net revenue and adjusted operating loss in
Wellness and Healthcare segment compared to 2023;
- No earnings impact from the May 15, 2024 Fiscal Court in
Dusseldorf ruling related to the legality of a supplemental tax
surcharge on HTUs in Germany, which went into effect in 2022. On
June 19, 2024, a German subsidiary of PMI submitted an appeal;
- Full-year amortization of acquired intangibles of $0.43 per
share, which includes an estimate of amortization of IQOS
commercialization rights in the U.S. following the closing of the
agreement to end our commercial relationship with Altria Group,
Inc. covering IQOS in the U.S. effective May 1, 2024;
- Net financing costs of approximately $1.3 billion;
- An effective tax rate, excluding discrete tax events, of
approximately 21% to 22%;
- Operating cash flow of approximately $11 billion at prevailing
exchange rates, subject to year-end working capital
requirements;
- Capital expenditures of approximately $1.3 to $1.4 billion,
including further investments in ZYN capacity in the U.S.;
- Net debt to adjusted EBITDA ratio improvement of 0.3x to 0.5x
at prevailing exchange rates as we continue to target a ratio of
around 2x by the end of 2026;
- No share repurchases in 2024; and
- A strong second-half performance, with third quarter adjusted
diluted EPS of $1.77 to $1.82 including an estimated adverse
currency impact of 2 cents at prevailing exchange rates.
Factors described in the Forward-Looking and Cautionary
Statements section of this release represent continuing risks to
these projections.
Conference Call
A conference call hosted by Emmanuel Babeau, Chief Financial
Officer, will be webcast at 9:00 a.m., Eastern Time, on July 23,
2024. Access the webcast at www.pmi.com/2024Q2earnings.
Financial Review
TOTAL MARKET, CONSOLIDATED SHIPMENT VOLUME
& MARKET SHARE
Total Market Volume
Second-Quarter
Estimated international industry volume (excluding China and the
U.S.) for cigarettes and HTUs increased by 1.5%, reflecting
increases in the SSEA, CIS & MEA Region, partly offset by
decreases in the Europe, Americas and EA, AU & PMI DF Regions,
as described in the Regional sections below.
Six Months Year-to-Date
Estimated international industry volume (excluding China and the
U.S.) for cigarettes and HTUs increased by 1.1%, reflecting
increase in the SSEA, CIS & MEA Region, partly offset by
decreases in the Europe and Americas Regions, and broadly stable in
the EA, AU & PMI DF Region, as described in the Regional
sections below.
Consolidated Shipment Volume
PMI Cigarettes and HTUs
Second-Quarter
Six Months
Year-to-Date
(million units)
2024
2023
Change
2024
2023
Change
Cigarettes
157,618
157,010
0.4%
300,809
300,718
—%
Heated Tobacco Units
35,544
31,424
13.1%
68,678
58,820
16.8%
Total Cigarettes and HTUs
193,162
188,434
2.5%
369,487
359,538
2.8%
PMI Oral SFP(1)
Second-Quarter
Six Months
Year-to-Date
(million cans)
2024
2023
Change
2024
2023
Change
Nicotine Pouches
149.9
99.5
50.6%
295.6
180.7
63.5%
Snus
58.8
62.6
(6.2)%
120.2
118.2
1.7%
Moist Snuff
34.2
34.1
0.2%
68.6
69.3
(1.1)%
Other Oral SFP(2)
1.0
1.2
(17.0)%
2.0
2.5
(16.8)%
Total Oral SFP
243.8
197.4
23.5%
486.4
370.7
31.2%
(1) Excluding snuff, snuff leaf and U.S.
chew
(2) Includes chew bags and tobacco
bits
Note: Sum may not foot due to
roundings.
Second-Quarter
PMI's total cigarette and HTU shipment volume increased by 2.5%
(HTU shipments increased by 13.1%, and cigarette shipments
increased by 0.4%), with increases across all regions except the
Americas.
PMI’s total oral product shipment volume in cans increased by
23.5%, predominantly reflecting growth in nicotine pouches.
Adjusted in-market sales for HTUs increased by 10.2%, including
growth in Japan of 12.5% and Europe of 6.8%.
Six Months Year-to-Date
PMI's total cigarette and HTU shipment volume increased by 2.8%
(HTU shipments increased by 16.8%, while cigarette shipments were
stable).
PMI’s total oral product shipment volume in cans increased by
31.2%, primarily reflecting growth in nicotine pouches.
Adjusted in-market sales for HTUs increased by 11.4%, including
growth in Japan of 12.9% and Europe of 8.0%. A net favorable impact
of estimated distributor inventory movements for HTU shipments was
driven most significantly by additional shipments to Japan in light
of disruption to Red Sea shipping routes.
International Share of Market - Cigarettes and HTUs
Second-Quarter
Six Months
Year-to-Date
2024
2023
Change (pp)
2024
2023
Change (pp)
Total International Market
Share(1)
28.7%
28.6%
0.1
28.3%
27.9%
0.4
Cigarettes
23.6%
24.0%
(0.4)
23.2%
23.4%
(0.2)
HTU
5.1%
4.7%
0.4
5.1%
4.6%
0.5
Cigarette over Cigarette Market
Share(2)
25.3%
25.5%
(0.2)
24.9%
24.9%
—
(1) Defined as PMI's cigarette and heated
tobacco unit in-market sales volume as a percentage of total
industry cigarette and heated tobacco unit sales volume, excluding
China and the U.S., including cigarillos in Japan
(2) Defined as PMI's cigarette in-market
sales volume as a percentage of total industry cigarette sales
volume, excluding China and the U.S., including cigarillos in
Japan
Note: Sum of share of market by product
categories might not foot to total due to roundings.
CONSOLIDATED FINANCIAL SUMMARY
Second-Quarter
Financial Summary
- Quarters Ended June
30,
Change
Fav./(Unfav.)
Variance
Fav./(Unfav.)
2024
2023
Total
Excl. Curr. &
Acquis.
Total
Cur-
rency
Acqui- sitions
Price
Vol/
Mix
Cost/
Other
(in millions)
Net Revenues
$
9,468
$
8,967
5.6
%
9.6
%
501
(358
)
—
583
303
(27
)
Cost of Sales(1)
(3,345
)
(3,228
)
(3.6
)%
(5.9
)%
(117
)
63
12
—
(145
)
(47
)
Marketing, Administration and Research
Costs(2)
(2,679
)
(2,508
)
(6.8
)%
(5.4
)%
(171
)
(36
)
—
—
—
(135
)
Impairment of Goodwill
—
(665
)
+100%
+100
%
665
—
—
—
—
665
Operating Income
$
3,444
$
2,566
34.2
%
46.6
%
878
(331
)
12
583
158
456
Impairment of Goodwill and Other
Intangibles (3)
—
(680
)
+100%
+100
%
680
—
—
—
—
680
Amortization of Intangibles
(212
)
(82
)
-(100
)%
-(100
)%
(130
)
—
—
—
—
(130
)
South Korea Indirect Tax Charge
—
(204
)
+100%
+100
%
204
—
—
—
—
204
Adjusted Operating Income
$
3,656
$
3,532
3.5
%
12.5
%
124
(331
)
12
583
158
(298
)
Adjusted Operating Income
Margin
38.6
%
39.4
%
(0.8
)pp
1.1
pp
(1) Includes $16 million in 2024 and $22
million in 2023 related to the special items below.
(2) Includes $196 million in 2024 and $279
million in 2023 related to the special items below.
(3) Includes $665 million impairment of
goodwill in 2023
Net revenues increased by 9.6% on an organic basis, mainly
reflecting: a favorable pricing variance, primarily due to higher
combustible tobacco pricing; and favorable volume/mix, driven by
higher smoke-free products volume.
Adjusted operating income increased by 12.5% on an organic
basis, mainly reflecting: the favorable pricing variance; and
favorable volume/mix, mainly driven by smoke-free products volume,
notwithstanding unfavorable cigarette mix; partly offset by higher
costs, predominantly marketing, administration and research
costs.
Six Months Year-to-Date
Financial Summary
- Six Months Ended June 30,
Change
Fav./(Unfav.)
Variance
Fav./(Unfav.)
2024
2023
Total
Excl. Curr. &
Acquis
Total
Cur-
rency
Acqui- sitions
Price
Vol/
Mix
Cost/
Other
(in millions)
Net Revenues
$
18,261
$
16,986
7.5
%
10.8
%
1,275
(552
)
—
1,032
767
28
Termination of distribution arrangement in
the Middle East
—
(80
)
+100
%
+100
%
80
—
—
—
—
80
Adjusted Net Revenues
$
18,261
$
17,066
7.0
%
10.2
%
1,195
(552
)
—
1,032
767
(52
)
Net Revenues
$
18,261
$
16,986
7.5
%
10.8
%
1,275
(552
)
—
1,032
767
28
Cost of Sales (1)
(6,540
)
(6,266
)
(4.4
)%
(5.7
)%
(274
)
71
12
—
(314
)
(43
)
Marketing, Administration and Research
Costs (2)
(5,232
)
(4,758
)
(10.0
)%
(6.2
)%
(474
)
(178
)
—
—
—
(296
)
Impairment of Goodwill
—
(665
)
+100
%
+100
%
665
—
—
—
—
665
Operating Income
$
6,489
$
5,297
22.5
%
34.7
%
1,192
(659
)
12
1,032
453
354
Asset Impairment & Exit Costs
(168
)
(109
)
(54.1
)%
(54.1
)%
(59
)
—
—
—
—
(59
)
Termination of distribution arrangement in
the Middle East (3)
—
(80
)
+100
%
+100
%
80
—
—
—
—
80
Impairment of Goodwill and Other
Intangibles (4)
(27
)
(680
)
96.0
%
96.0
%
653
—
—
—
—
653
Amortization of Intangibles
(332
)
(163
)
-(100
)%
-(100
)%
(169
)
—
—
—
—
(169
)
Swedish Match AB acquisition accounting
related items
—
(18
)
+100
%
+100
%
18
—
—
—
—
18
South Korea Indirect Tax Charge
—
(204
)
+100
%
+100
%
204
—
—
—
—
204
Adjusted Operating Income
$
7,016
$
6,551
7.1
%
17.0
%
465
(659
)
12
1,032
453
(373
)
Adjusted Operating Income
Margin
38.4
%
38.4
%
—
pp
2.3
pp
(1) Includes $32 million in 2024 and $62
million in 2023 related to the special items below.
(2) Includes $495 million in 2024 and $447
million in 2023 related to the special items below.
(3) Included in Net Revenues above.
(4) Includes $665 million impairment of
goodwill in 2023.
Adjusted net revenues increased by 10.2% on an organic basis,
mainly reflecting: a favorable pricing variance, primarily driven
by higher combustible tobacco pricing; and favorable volume/mix,
driven by higher smoke-free products volume, partly offset by
unfavorable cigarette mix.
Adjusted operating income increased by 17.0% on an organic
basis, mainly reflecting: the favorable pricing variance,
predominantly driven by higher combustible tobacco pricing; and
favorable volume/mix, mainly driven by higher smoke-free products
volume; partly offset by higher marketing, administration and
research costs (primarily due to inflationary impacts, notably
related to wages, and higher commercial investments), as well as
higher manufacturing costs (primarily due to inflationary impacts,
notably related to tobacco leaf and the impact of the EU single-use
plastics directive, partly offset by productivity).
EUROPE REGION
Total Market, PMI Shipment & Market Share
Commentaries
Second-Quarter
The estimated total market for cigarettes and HTUs in the Region
decreased by 1.7% to 138.0 billion units, reflecting a 2.8% decline
for cigarettes, partly offset by an increase for HTUs. The decrease
in the estimated total market was predominantly due to France (down
by 11.4%), the UK (down by 15.4%), Germany (down by 3.3%), and the
Netherlands (down by 20.7%), partly offset by Bulgaria (up by
10.6%), Romania (up by 5.0%), and Greece (up by 8.3%).
Six Months Year-to-Date
The estimated total market for cigarettes and HTUs in the Region
decreased by 1.2% to 262.1 billion units, reflecting a 2.6% decline
for cigarettes, partly offset by an increase for HTUs. The decrease
in the estimated total market was predominantly due to France (down
by 13.8%), the UK (down by 13.3%), and the Netherlands (down by
15.5%), partly offset by Bulgaria (up by 9.7%), Poland (up by
2.3%), Romania (up by 3.9%), and Greece (up by 7.1%).
Europe Key Data
Second-Quarter
Six Months
Year-to-Date
Change
Change
2024
2023
% / pp
2024
2023
% / pp
PMI Shipment Volume (million
units)
Cigarettes
43,467
43,741
(0.6)%
80,556
82,898
(2.8)%
Heated Tobacco Units
12,935
11,705
10.5%
24,275
21,804
11.3%
Total Europe
56,402
55,446
1.7%
104,831
104,702
0.1%
PMI Market Share
Cigarettes
30.2%
30.3%
(0.1)
30.1%
30.3%
(0.2)
Heated Tobacco Units
9.6%
8.8%
0.8
9.8%
8.9%
0.9
Total Europe
39.8%
39.1%
0.7
40.0%
39.2%
0.8
Note: Sum may not foot due to
roundings.
Europe Oral SFP
Second-Quarter
Six Months
Year-to-Date
2024
2023
Change
2024
2023
Change
PMI Shipment Volume (million
cans)
Nicotine Pouches
11.8
9.3
26.9%
24.1
17.2
40.2%
Snus
58.0
61.4
(5.6)%
118.7
115.8
2.5%
Other Oral SFP(1)
1.0
1.2
(17.0)%
2.0
2.5
(16.8)%
Total Europe
70.8
71.9
(1.6)%
144.8
135.4
6.9%
(1) Includes chew bags and tobacco
bits
Note: Sum may not foot due to
roundings.
Second-Quarter
PMI's total cigarette and HTU shipment volume in the Region
increased by 1.7% to 56.4 billion units. Total cigarette and HTU
shipment volume increased notably in Italy (up by 7.6%), mainly
driven by cigarettes, and Poland (up by 6.0%), and decreased
notably in France (down by 11.7%) and the Netherlands (down by
19.5%), both driven by cigarettes.
PMI's estimated HTU adjusted in-market sales volume in the
Region increased by 6.8% in the quarter, reflecting continued
growth momentum for IQOS, partly offset by the impact from the EU
characterizing flavor ban.
PMI's HTU share of the total cigarette and HTU market in the
Region increased by 0.8 points on an adjusted basis.
Oral SFP shipments decreased by 1.6% with decline of snus (down
by 5.6%), partly offset by nicotine pouches (up by 26.9%).
Six Months Year-to-Date
PMI's total cigarette and HTU shipment volume in the Region
increased by 0.1% to 104.8 billion units. Total cigarette and HTU
shipment volume increased notably in Poland (up by 7.9%), Greece
(up by 9.6%), and Germany (up by 1.9%), and decreased notably in
France (down by 21.7%) and the Netherlands (down by 15.2%), both
driven by cigarettes.
PMI's estimated HTU adjusted in-market sales volume in the
Region increased by 8.0%, reflecting continued growth momentum for
IQOS, partly offset by the impact from the EU characterizing flavor
ban.
PMI's HTU share of the total cigarette and HTU market in the
Region increased by 0.9 points on an adjusted basis.
Oral SFP shipments increased by 6.9%, driven by growth of
nicotine pouches (up by 40.2%) and snus (up by 2.5%).
Financial Summary
Second-Quarter
Financial Summary
- Quarters Ended June
30,
Change
Fav./(Unfav.)
Variance
Fav./(Unfav.)
2024
2023
Total
Excl. Curr. &
Acquis.
Total
Cur-
rency
Acqui- sitions
Price
Vol/
Mix
Cost/
Other
(in millions)
Net Revenues
$
3,815
$
3,574
6.7
%
7.0
%
241
(9
)
—
205
45
—
Operating Income
$
1,660
$
1,619
2.5
%
5.3
%
41
(45
)
—
205
2
(121
)
Adjustments (1)
(40
)
(28
)
(41.8
)%
(41.8
)%
(12
)
—
—
—
—
(12
)
Adjusted Operating Income
$
1,701
$
1,647
3.3
%
6.0
%
54
(45
)
—
205
2
(109
)
Adjusted Operating Income
Margin
44.6
%
46.1
%
(1.5
)pp
(0.4
)pp
(1) See Schedule 10 in Exhibit 99.2 to the
Form 8-K dated July 23, 2024, for additional detail.
Net revenues increased by 7.0% on an organic basis, reflecting:
a favorable pricing variance, mainly driven by higher combustible
tobacco pricing; and favorable volume/mix, primarily driven by
higher HTU volume, partly offset by lower cigarettes volume.
Adjusted operating income increased by 6.0% on an organic basis,
reflecting: a favorable pricing variance, mainly driven by higher
combustible tobacco pricing; partly offset by higher marketing,
administration and research costs as well as manufacturing costs,
including the impact of the EU single-use plastics directive.
Six Months Year-to-Date
Financial Summary
- Six Months Ended
June 30,
Change
Fav./(Unfav.)
Variance
Fav./(Unfav.)
2024
2023
Total
Excl. Curr. &
Acquis.
Total
Cur-
rency
Acqui- sitions
Price
Vol/
Mix
Cost/
Other
(in millions)
Net Revenues
$
7,180
$
6,642
8.1
%
7.1
%
538
69
—
368
101
—
Operating Income
$
3,116
$
2,834
10.0
%
11.0
%
282
(31
)
—
368
66
(121
)
Adjustments (1)
(80
)
(103
)
22.0
%
22.0
%
23
—
—
—
—
23
Adjusted Operating Income
$
3,197
$
2,937
8.9
%
9.9
%
260
(31
)
—
368
66
(143
)
Adjusted Operating Income
Margin
44.5
%
44.2
%
0.3
pp
1.2
pp
(1) See Schedule 11 in Exhibit 99.2 to the
Form 8-K dated July 23, 2024, for additional detail.
Net revenues increased by 7.1% on an organic basis, primarily
driven by the same factors as for the quarter.
Adjusted operating income increased by 9.9% on an organic basis,
reflecting: a favorable pricing variance, mainly driven by higher
combustible tobacco pricing; and favorable volume/mix, primarily
driven by higher HTU volume, notwithstanding lower cigarette
volume; partly offset by higher marketing, administration and
research costs as well as manufacturing costs, including the impact
of the EU single-use plastics directive.
SSEA, CIS & MEA REGION
Total Market, PMI Shipment & Market Share
Commentaries
Second-Quarter
The estimated total market for cigarettes and HTUs in the Region
increased by 3.7% to 393.9 billion units. The increase in the
estimated total market was mainly due to Russia (up by 6.2%),
Pakistan (up by 42.4%), Egypt (up by 18.6%), Bangladesh (up by
8.5%), and Turkey (up by 4.1%), partly offset by Thailand (down by
19.5%) and Kazakhstan (down by 8.8%).
Six Months Year-to-Date
The estimated total market for cigarettes and HTUs in the Region
increased by 2.5% to 767.0 billion units. The increase in the
estimated total market was mainly due to Turkey (up by 10.3%),
Russia (up by 5.3%), Indonesia (up by 3.1%), and Bangladesh (up by
6.5%), partly offset by Thailand (down by 14.1%) and Philippines
(down by 7.9%).
PMI Shipment Volume
Second-Quarter
Six Months
Year-to-Date
(million units)
2024
2023
Change
2024
2023
Change
Cigarettes
87,391
84,415
3.5%
167,582
160,946
4.1%
Heated Tobacco Units
6,937
5,853
18.5%
13,015
11,300
15.2%
Total SSEA, CIS & MEA
94,328
90,268
4.5%
180,597
172,246
4.8%
Second-Quarter
PMI's total cigarette and HTU shipment volume in the Region
increased by 4.5% to 94.3 billion units, mainly driven by Turkey
(up by 9.7%) and Saudi Arabia (up by 68.9% due to inventory
movements), partly offset by Indonesia (down by 6.4%), Thailand
(down by 24.9%) and the Philippines (down by 9.7%). PMI's estimated
HTU adjusted in-market sales volume increased by 11.4%, with 18.5%
HTU shipment volume growth. HTU shipment growth in Russia primarily
reflects timing and cross-border dynamics, with limited underlying
growth.
Six Months Year-to-Date
PMI's total cigarette and HTU shipment volume in the Region
increased by 4.8% to 180.6 billion units, mainly driven by Turkey
(up by 16.0%), partly offset by the Philippines (down by 14.2%).
PMI's estimated HTU adjusted in-market sales volume increased by
13.1%, with 15.2% HTU shipment volume growth.
Financial Summary
Second-Quarter
Financial Summary
- Quarters Ended June
30,
Change
Fav./(Unfav.)
Variance
Fav./(Unfav.)
2024
2023
Total
Excl. Curr. &
Acquis.
Total
Cur-
rency
Acqui- sitions
Price
Vol/
Mix
Cost/
Other
(in millions)
Net Revenues
$
2,771
$
2,668
3.9
%
13.3
%
103
(251
)
—
229
123
2
Operating Income
$
891
$
880
1.3
%
26.0
%
11
(230
)
12
229
50
(50
)
Adjustments (1)
(5
)
(5
)
6.8
%
6.8
%
—
—
—
—
—
—
Adjusted Operating Income
$
896
$
885
1.2
%
25.9
%
11
(230
)
12
229
50
(50
)
Adjusted Operating Income
Margin
32.3
%
33.2
%
(0.9
)pp
3.7
pp
(1) See Schedule 10 in Exhibit 99.2 to the
Form 8-K dated July 23, 2024, for additional detail.
Net revenues increased by 13.3% on an organic basis, primarily
reflecting: a favorable pricing variance, mainly driven by higher
combustible tobacco pricing; and favorable volume/mix, driven by
higher HTU and cigarettes volume, as well as favorable HTU and
cigarette mix.
Adjusted operating income increased by 25.9% on an organic
basis, primarily reflecting: a favorable pricing variance, mainly
driven by higher combustible tobacco pricing; and favorable
volume/mix, driven by higher smoke-free products and cigarettes
volume, notwithstanding unfavorable cigarette mix; partly offset by
higher manufacturing costs (primarily due to higher cost of tobacco
leaf).
Six Months Year-to-Date
Financial Summary
- Six Months Ended June 30,
Change
Fav./(Unfav.)
Variance
Fav./(Unfav.)
2024
2023
Total
Excl. Curr. &
Acquis.
Total
Cur-
rency
Acqui- sitions
Price
Vol/
Mix
Cost/
Other
(in millions)
Net Revenues
$
5,429
$
5,145
5.5
%
14.2
%
284
(445
)
—
384
267
78
Adjustment (1)
—
(80
)
+100
%
+100
%
80
—
—
—
—
80
Adjusted Net Revenues
$
5,429
$
5,225
3.9
%
12.4
%
204
(445
)
—
384
267
(2
)
Net Revenues
$
5,429
$
5,145
5.5
%
14.2
%
284
(445
)
—
384
267
78
Operating Income
$
1,663
$
1,614
3.0
%
31.5
%
49
(471
)
12
384
96
28
Adjustments (2)
(10
)
(122
)
92.1
%
92.1
%
112
—
—
—
—
112
Adjusted Operating Income
$
1,673
$
1,736
(3.6
)%
22.8
%
(63
)
(471
)
12
384
96
(84
)
Adjusted Operating Income
Margin
30.8
%
33.2
%
(2.4
)pp
3.1
pp
(1) Termination of distribution
arrangement in the Middle East.
(2) See Schedule 11 in Exhibit 99.2 to the
Form 8-K dated July 23, 2024, for additional detail.
Adjusted net revenues increased by 12.4% on an organic basis,
primarily reflecting: a favorable pricing variance, mainly driven
by higher combustible tobacco pricing; and favorable volume/mix,
driven by higher cigarette and HTU volume and favorable cigarettes
mix.
Adjusted operating income increased by 22.8% on an organic
basis, primarily reflecting: a favorable pricing variance, mainly
driven by higher combustible tobacco pricing; and favorable
volume/mix, driven by higher cigarette and HTU volume,
notwithstanding unfavorable cigarette mix; partly offset by higher
manufacturing costs (primarily due to higher cost of tobacco
leaf).
EA, AU AND PMI DF REGION
Total Market, PMI Shipment & Market Share
Commentaries
Second-Quarter
The estimated total market for cigarettes and HTUs in the
Region, excluding China, decreased by 0.7% to 80.2 billion units,
with a decline in cigarettes, partly offset by HTU growth. The
decrease in the estimated total market was mainly driven by
Australia (down by 29.1%), South Korea (down by 1.9%), and Taiwan
(down by 4.2%), partly offset by International Duty Free (up by
8.5%) and Japan (up by 0.9%).
Six Months Year-to-Date
The estimated total market for cigarettes and HTUs in the
Region, excluding China, was stable at 156.0 billion units, with
HTU growth partly offset by a decline in cigarettes. The increase
in the estimated total market was mainly driven by International
Duty Free (up by 12.4%) and Japan (up by 1.0%), partly offset by
Australia (down by 29.4%).
PMI Shipment Volume
Second-Quarter
Six Months
Year-to-Date
(million units)
2024
2023
Change
2024
2023
Change
Cigarettes
11,872
13,351
(11.1)%
23,440
26,461
(11.4)%
Heated Tobacco Units
15,474
13,714
12.8%
31,073
25,462
22.0%
Total EA, AU & PMI DF
27,346
27,065
1.0%
54,513
51,923
5.0%
Second-Quarter
PMI's total cigarette and HTU shipment volume in the Region
increased by 1.0% to 27.3 billion units, driven by Japan (up by
5.0%), partly offset by Australia (down by 28.5%).
PMI's estimated HTU adjusted in-market sales volume in the
Region increased by 13.3% in the quarter, including growth in Japan
of 12.5%.
Six Months Year-to-Date
PMI's total cigarette and HTU shipment volume in the Region
increased by 5.0% to 54.5 billion units, driven by Japan (up by
12.6%), partly offset by Australia (down by 27.2%).
PMI's estimated HTU adjusted in-market sales volume in the
Region increased by 14.1%, including growth in Japan of 12.9%.
Financial Summary
Second-Quarter
Financial Summary
- Quarters Ended June
30,
Change
Fav./(Unfav.)
Variance
Fav./(Unfav.)
2024
2023
Total
Excl. Curr. &
Acquis.
Total
Cur-
rency
Acqui- sitions
Price
Vol/
Mix
Cost/
Other
(in millions)
Net Revenues
$
1,673
$
1,680
(0.4
)%
6.7
%
(7
)
(120
)
—
88
25
—
Operating Income
$
753
$
557
35.2
%
51.5
%
196
(91
)
—
88
2
197
Adjustments (1)
(1
)
(205
)
99.7
%
99.7
%
204
—
—
—
—
204
Adjusted Operating Income
$
753
$
762
(1.2
)%
10.8
%
(9
)
(91
)
—
88
2
(7
)
Adjusted Operating Income
Margin
45.0
%
45.4
%
(0.4
)pp
1.7
pp
(1) See Schedule 10 in Exhibit 99.2 to the
Form 8-K dated July 23, 2024, for additional detail.
Net revenues increased by 6.7% on an organic basis, reflecting:
a favorable pricing variance and favorable volume/mix, mainly
driven by higher HTU volume, partly offset by lower cigarette
volume.
Adjusted operating income increased by 10.8% on an organic
basis, primarily driven by the same factors as for net
revenues.
Six Months Year-to-Date
Financial Summary
- Six Months Ended June 30,
Change
Fav./(Unfav.)
Variance
Fav./(Unfav.)
2024
2023
Total
Excl. Curr. &
Acquis.
Total
Cur-
rency
Acqui- sitions
Price
Vol/
Mix
Cost/
Other
(in millions)
Net Revenues
$
3,357
$
3,200
4.9
%
12.1
%
157
(229
)
—
218
168
—
Operating Income
$
1,516
$
1,194
27.0
%
45.1
%
322
(216
)
—
218
74
246
Adjustments (1)
(1
)
(225
)
99.3
%
99.3
%
224
—
—
—
—
224
Adjusted Operating Income
$
1,517
$
1,419
6.9
%
22.1
%
98
(216
)
—
218
74
23
Adjusted Operating Income
Margin
45.2
%
44.3
%
0.9
pp
4.0
pp
(1) See Schedule 11 in Exhibit 99.2 to the
Form 8-K dated July 23, 2024, for additional detail.
Net revenues increased by 12.1% on an organic basis, reflecting:
a favorable pricing variance and favorable volume/mix, mainly
driven by higher HTU volume, partly offset by lower cigarette
volume.
Adjusted operating income increased by 22.1% on an organic
basis, primarily driven by the same factors as for net
revenues.
AMERICAS REGION
Total Market, PMI Shipment & Market Share
Commentaries
Second-Quarter
The estimated total market for cigarettes and HTUs in the
Region, excluding the U.S., decreased by 2.7% to 45.2 billion
units, primarily reflecting a decline for cigarettes. The decrease
in the estimated total market was mainly due to Argentina (down by
20.0%) and Canada (down by 12.6%), partly offset by Brazil (up by
9.6%).
Six Months Year-to-Date
The estimated total market for cigarettes and HTUs in the
Region, excluding the U.S., decreased by 2.8% to 89.9 billion
units, primarily reflecting a decline for cigarettes. The decrease
in the estimated total market was mainly due to Argentina (down by
13.8%) and Canada (down by 12.9%), partly offset by Brazil (up by
6.5%).
PMI Shipment Volume
Second-Quarter
Six Months
Year-to-Date
(million units)
2024
2023
Change
2024
2023
Change
Cigarettes
14,888
15,503
(4.0)%
29,231
30,413
(3.9)%
Heated Tobacco Units
198
152
30.3%
315
254
24.0%
Total Americas
15,086
15,655
(3.6)%
29,546
30,667
(3.7)%
Note: Sum may not foot due to
roundings.
Americas Oral SFP1
Second-Quarter
Six Months
Year-to-Date
2024
2023
Change
2024
2023
Change
PMI Shipment Volume (million
cans)
Nicotine Pouches
135.1
89.9
50.3%
266.7
163.1
63.5%
Moist Snuff
34.2
34.1
0.2%
68.6
69.3
(1.1)%
Snus
0.8
1.2
(37.3)%
1.5
2.4
(38.4)%
Total Americas
170.1
125.2
35.8%
336.7
234.8
43.4%
(1) Excluding U.S. chew
Note: Sum may not foot due to
roundings.
Second-Quarter
PMI's total cigarette and HTU shipment volume in the Region
decreased by 3.6% to 15.1 billion units, mainly due to Argentina
(down by 19.9%), partly offset by Brazil (up by 8.7%).
Oral products shipments increased by 35.8%, driven by ZYN
nicotine pouches (up by 50.3%) in the U.S.
Six Months Year-to-Date
PMI's total cigarette and HTU shipment volume in the Region
decreased by 3.7% to 29.5 billion units, mainly due to Argentina
(down by 14.7%), partly offset by Brazil (up by 9.4%).
Cigar shipment volume declined by 18.3%, predominantly due to a
tough comparison related to trade inventory movements in the
prior-year around the April 2023 price increase. Gross profit grew
robustly.
Oral products shipments increased by 43.4%, driven by ZYN
nicotine pouches (up by 63.5%) in the U.S.
Financial Summary
Second-Quarter
Financial Summary
- Quarters Ended June
30,
Change
Fav./(Unfav.)
Variance
Fav./(Unfav.)
2024
2023
Total
Excl. Curr. &
Acquis.
Total
Cur-
rency
Acqui- sitions
Price
Vol/
Mix
Cost/
Other
(in millions)
Net Revenues
$
1,129
$
969
16.5
%
14.2
%
160
22
—
55
110
(27
)
Operating Income
$
183
$
243
(24.7
)%
(39.1
)%
(60
)
35
—
55
104
(254
)
Adjustments (1)
(152
)
(33
)
-(100
)%
-(100
)%
(119
)
—
—
—
—
(119
)
Adjusted Operating Income
$
335
$
276
21.4
%
8.7
%
59
35
—
55
104
(135
)
Adjusted Operating Income
Margin
29.7
%
28.5
%
1.2
pp
(1.4
)pp
(1) See Schedule 10 in Exhibit 99.2 to the
Form 8-K dated July 23, 2024, for additional detail.
Net revenues increased by 14.2% on an organic basis, primarily
reflecting: favorable volume/mix, mainly due to the growth of ZYN
nicotine pouches in the U.S., partly offset by lower cigarette
volume and unfavorable cigarette mix outside of the U.S.; and
favorable pricing variance, predominantly driven by higher
combustible tobacco pricing.
Adjusted operating income increased by 8.7% on an organic basis,
mainly reflecting: favorable volume/mix and price variance, mainly
due to the same factors as for net revenues; partly offset by
higher marketing and administration costs, including incremental
investment in the U.S.
Six Months Year-to-Date
Financial Summary
- Six Months Ended
June 30,
Change
Fav./(Unfav.)
Variance
Fav./(Unfav.)
2024
2023
Total
Excl. Curr. &
Acquis.
Total
Cur-
rency
Acqui- sitions
Price
Vol/
Mix
Cost/
Other
(in millions)
Net Revenues
$
2,125
$
1,837
15.7
%
12.9
%
288
51
—
54
231
(48
)
Operating Income
$
282
$
426
(33.8
)%
(47.2
)%
(144
)
57
—
54
217
(472
)
Adjustments (1)
(379
)
(95
)
-(100
)%
-(100
)%
(284
)
—
—
—
—
(284
)
Adjusted Operating Income
$
661
$
521
26.9
%
15.9
%
140
57
—
54
217
(188
)
Adjusted Operating Income
Margin
31.1
%
28.4
%
2.7
pp
0.7
pp
(1) See Schedule 11 in Exhibit 99.2 to the
Form 8-K dated July 23, 2024, for additional detail.
Net revenues increased by 12.9% on an organic basis, primarily
reflecting: favorable volume/mix, mainly due to growth of ZYN
nicotine pouches in the U.S., partly offset by cigarette volume
declines outside of the U.S.; and favorable cigarette pricing.
Adjusted operating income increased by 15.9% on an organic
basis, mainly reflecting: favorable volume/mix, mainly due to the
same factors as for net revenues; and favorable cigarette pricing;
partly offset by higher marketing and administration costs,
including incremental investment in the U.S.
WELLNESS AND HEALTHCARE
The results of PMI’s Vectura Fertin Pharma business are reported
in the Wellness and Healthcare segment.
Second-Quarter
Financial Summary
- Quarters Ended June
30,
Change
Fav./(Unfav.)
Variance
Fav./(Unfav.)
2024
2023
Total
Excl. Curr. &
Acquis.
Total
Cur-
rency
Acqui- sitions
Price
Vol/
Mix
Cost/
Other
(in millions)
Net Revenues
$
80
$
76
5.3
%
5.3
%
4
—
—
6
—
(2
)
Operating Income / (Loss)
$
(43
)
$
(733
)
94.1
%
94.1
%
690
—
—
6
—
684
Adjustments (1)
(14
)
(695
)
97.9
%
97.9
%
681
—
—
—
—
681
Adjusted Operating Income /
(Loss)
$
(29
)
$
(38
)
23.7
%
23.7
%
9
—
—
6
—
3
Adjusted Operating Income / (Loss)
Margin
(36.3
)%
(50.0
)%
13.7
pp
13.7
pp
(1) See Schedule 10 in Exhibit 99.2 to the
Form 8-K dated July 23, 2024, for additional detail.
Net revenues increased by 5.3% on an organic basis. The adjusted
operating loss of $29 million was primarily due to R&D and
administration costs.
Six Months Year-to-Date
Financial Summary
- Six Months Ended June
30,
Change
Fav./(Unfav.)
Variance
Fav./(Unfav.)
2024
2023
Total
Excl. Curr. &
Acquis.
Total
Cur-
rency
Acqui- sitions
Price
Vol/
Mix
Cost/
Other
(in millions)
Net Revenues
$
170
$
162
4.9
%
3.7
%
8
2
—
8
—
(2
)
Operating Income / (Loss)
$
(88
)
$
(771
)
88.6
%
88.3
%
683
2
—
8
—
673
Adjustments (1)
(56
)
(709
)
92.1
%
92.1
%
653
—
—
—
—
653
Adjusted Operating Income /
(Loss)
$
(32
)
$
(62
)
48.4
%
45.2
%
30
2
—
8
—
20
Adjusted Operating Income / (Loss)
Margin
(18.8
)%
(38.3
)%
19.5
pp
18.1
pp
(1) See Schedule 11 in Exhibit 99.2 to the
Form 8-K dated July 23, 2024, for additional detail.
Net revenues increased by 3.7% on an organic basis. The adjusted
operating loss of $32 million was primarily due to R&D and
administration costs.
Philip Morris International: Delivering a Smoke-Free
Future
Philip Morris International (PMI) is a leading international
tobacco company, actively delivering a smoke-free future and
evolving its portfolio for the long term to include products
outside of the tobacco and nicotine sector. The company’s current
product portfolio primarily consists of cigarettes and smoke-free
products. Since 2008, PMI has invested over $12.5 billion to
develop, scientifically substantiate and commercialize innovative
smoke-free products for adults who would otherwise continue to
smoke, with the goal of completely ending the sale of cigarettes.
This includes the building of world-class scientific assessment
capabilities, notably in the areas of pre-clinical systems
toxicology, clinical and behavioral research, as well as
post-market studies. In 2022, PMI acquired Swedish Match – a leader
in oral nicotine delivery – creating a global smoke-free champion
led by the companies’ IQOS and ZYN brands. The U.S. Food and Drug
Administration has authorized versions of PMI’s IQOS devices and
consumables and Swedish Match’s General snus as Modified Risk
Tobacco Products and renewal applications for these products are
presently pending before the FDA. As of June 30, 2024, PMI's
smoke-free products were available for sale in 90 markets, and PMI
estimates that 36.5 million adults around the world use PMI's
smoke-free products. Smoke-free business accounted for
approximately 38% of PMI’s total first-half 2024 net revenues. With
a strong foundation and significant expertise in life sciences, PMI
announced in February 2021 its ambition to expand into wellness and
healthcare areas and, through its Vectura Fertin Pharma business,
aims to enhance life through the delivery of seamless health
experiences. For more information, please visit www.pmi.com and
www.pmiscience.com.
Forward-Looking and Cautionary Statements
This press release contains projections of future results and
goals and other forward-looking statements, including statements
regarding expected financial or operational performance; capital
allocation plans; investment strategies; regulatory outcomes;
market expectations; and business plans and strategies. Achievement
of future results is subject to risks, uncertainties and inaccurate
assumptions. In the event that risks or uncertainties materialize,
or underlying assumptions prove inaccurate, actual results could
vary materially from those contained in such forward-looking
statements. Pursuant to the “safe harbor” provisions of the Private
Securities Litigation Reform Act of 1995, PMI is identifying
important factors that, individually or in the aggregate, could
cause actual results and outcomes to differ materially from those
contained in any forward-looking statements made by PMI.
PMI's business risks include: excise tax increases and
discriminatory tax structures; increasing marketing and regulatory
restrictions that could reduce our competitiveness, eliminate our
ability to communicate with adult consumers, or ban certain of our
products in certain markets or countries; health concerns relating
to the use of tobacco and other nicotine-containing products and
exposure to environmental tobacco smoke; litigation related to
tobacco and/or nicotine use and intellectual property; intense
competition; the effects of global and individual country economic,
regulatory and political developments, natural disasters and
conflicts; the impact and consequences of Russia's invasion of
Ukraine; changes in adult smoker behavior; the impact of natural
disasters and pandemics on PMI's business; lost revenues as a
result of counterfeiting, contraband and cross-border purchases;
governmental investigations; unfavorable currency exchange rates
and currency devaluations, and limitations on the ability to
repatriate funds; adverse changes in applicable corporate tax laws;
adverse changes in the cost, availability, and quality of tobacco
and other agricultural products and raw materials, as well as
components and materials for our electronic devices; and the
integrity of its information systems and effectiveness of its data
privacy policies. PMI's future profitability may also be adversely
affected should it be unsuccessful in its attempts to introduce,
commercialize, and grow smoke-free products or if regulation or
taxation do not differentiate between such products and cigarettes;
if it is unable to successfully introduce new products, promote
brand equity, enter new markets or improve its margins through
increased prices and productivity gains; if it is unable to expand
its brand portfolio internally or through acquisitions and the
development of strategic business relationships; if it is unable to
attract and retain the best global talent, including women or
diverse candidates; or if it is unable to successfully integrate
and realize the expected benefits from recent transactions and
acquisitions. Future results are also subject to the lower
predictability of our smoke-free products performance.
PMI is further subject to other risks detailed from time to time
in its publicly filed documents, including PMI's Annual Report on
Form 10-K for the fourth quarter and year ended December 31, 2023,
and the Quarterly Report on Form 10-Q for the second quarter ended
June 30, 2024, which will be filed in the coming days. PMI cautions
that the foregoing list of important factors is not a complete
discussion of all potential risks and uncertainties. PMI does not
undertake to update any forward-looking statement that it may make
from time to time, except in the normal course of its public
disclosure obligations.
Non-GAAP Measures, Glossary and Explanatory Notes
Reconciliations of non-GAAP measures in this release to the most
directly comparable U.S. GAAP measures can be found in Exhibit 99.2
to the Form 8-K dated July 23, 2024, and at
www.pmi.com/2024Q2earnings. A glossary of key terms, definitions
and explanatory notes is available in the aforementioned Exhibit
99.2 and on the same webpage, where additional financial schedules,
as well as adjustments and other calculations have also been made
available.
Management reviews net revenues, gross profit, operating income,
operating income margin, operating cash flow and earnings per
share, or "EPS," on an adjusted basis, which may exclude the impact
of currency and other items such as acquisitions, asset impairment
and exit costs, tax items and other special items. Additionally,
starting in 2022 and on a comparative basis, for these measures
other than net revenues and operating cash flow, PMI includes
adjustments to add back amortization expense on acquisition related
intangible assets that are recorded as part of purchase accounting
and contribute to PMI’s revenue generation, as well as impairment
of intangible assets, if any. While amortization expense on
acquisition related intangible assets is excluded in these adjusted
measures, the net revenues generated from these acquired intangible
assets are included in the company's adjusted measures, unless
otherwise stated. Currency-neutral and organic growth rates reflect
the way management views underlying performance for these measures.
PMI believes that such measures provide useful insight into
underlying business trends and results. Management reviews these
measures because they exclude changes in currency exchange rates
and other factors that may distort underlying business trends,
thereby improving the comparability of PMI’s business performance
between reporting periods. Furthermore, PMI uses several of these
measures in its management compensation program to promote internal
fairness and a disciplined assessment of performance against
company targets. PMI discloses these measures to enable investors
to view the business through the eyes of management.
Non-GAAP measures used in this release should neither be
considered in isolation nor as a substitute for the financial
measures prepared in accordance with U.S. GAAP.
Diluted EPS
reconciliation
Second-Quarter
2024
2023
% Change
Reported Diluted EPS
$
1.54
$
1.01
52.5
%
Impairment of goodwill and other
intangibles
—
0.44
Amortization of intangibles
0.11
0.04
South Korea indirect tax charge
—
0.11
Income tax impact associated with Swedish
Match AB financing
0.02
(0.01
)
Fair value adjustment for equity security
investments
(0.08
)
0.01
Adjusted Diluted EPS
$
1.59
$
1.60
(0.6
)%
Less: Currency
(0.18
)
Adjusted Diluted EPS, excluding
Currency
$
1.77
$
1.60
10.6
%
Appendix 1
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Key Market Data
Quarters Ended June
30,
Market
Total Market,
bio units
PMI Shipments, bio
units
PMI Market Share(2), %
Total
Cigarette
HTU
Total
HTU
2024
2023
% Change
2024
2023
% Change
2024
2023
% Change
2024
2023
% Change
2024
2023
pp Change
2024
2023
pp Change
Total(1)(2)
657.2
647.2
1.5
193.2
188.4
2.5
157.6
157.0
0.4
35.5
31.4
13.1
28.7
28.6
0.1
5.1
4.7
0.4
Europe
France
6.7
7.6
(11.4)
3.3
3.7
(11.7)
3.3
3.7
(11.3)
—
0.1
(37.6)
41.5
42.4
(0.9)
0.6
0.8
(0.2)
Germany(3)
17.3
17.9
(3.3)
6.8
6.9
(0.6)
5.8
6.1
(6.0)
1.1
0.7
43.4
39.0
39.2
(0.2)
6.0
5.4
0.6
Italy(3)
18.1
18.4
(1.5)
10.6
9.8
7.6
8.0
7.0
14.5
2.5
2.8
(9.7)
53.6
53.6
—
16.7
17.1
(0.4)
Poland(3)
15.0
15.0
0.1
6.5
6.1
6.0
5.1
4.9
4.4
1.4
1.2
12.5
43.3
41.1
2.2
9.1
8.6
0.5
Spain
11.2
11.3
(0.6)
3.5
3.6
(3.2)
3.2
3.3
(3.7)
0.3
0.3
2.4
29.2
29.2
—
2.6
2.2
0.4
SSEA, CIS & MEA
Egypt
19.0
16.1
18.6
6.7
6.0
11.6
6.3
5.7
11.8
0.3
0.3
8.2
34.5
37.2
(2.7)
1.9
1.8
0.1
Indonesia
71.9
72.2
(0.5)
19.6
21.0
(6.4)
19.4
20.8
(7.1)
0.3
0.1
89.1
27.3
29.1
(1.8)
0.4
0.2
0.2
Philippines
9.7
10.2
(4.8)
5.1
5.7
(9.7)
5.0
5.6
(10.1)
0.1
—
—
52.7
55.6
(2.9)
0.7
0.5
0.2
Russia
55.1
51.9
6.2
17.4
16.5
5.3
12.9
12.6
2.6
4.4
3.9
14.1
31.6
32.8
(1.2)
8.2
7.9
0.3
Turkey
38.9
37.4
4.1
20.3
18.5
9.7
20.3
18.5
9.7
—
—
—
52.3
49.6
2.7
—
—
—
EA, AU & PMI DF
Australia
1.4
1.9
(29.1)
0.4
0.6
(28.5)
0.4
0.6
(28.5)
—
—
—
32.8
32.5
0.3
—
—
—
Japan(2)
37.9
37.6
0.9
17.5
16.7
5.0
4.1
4.9
(16.7)
13.4
11.8
14.0
40.9
39.4
1.5
29.4
26.3
3.1
South Korea
18.2
18.5
(1.9)
3.6
3.6
(1.3)
2.2
2.3
(6.0)
1.4
1.3
6.9
19.6
19.5
0.1
7.7
7.0
0.7
Americas
Argentina
5.9
7.3
(20.0)
3.6
4.5
(19.9)
3.6
4.5
(19.9)
—
—
—
61.5
61.5
—
—
—
—
Mexico
7.4
7.4
0.9
4.6
4.6
(0.4)
4.6
4.6
(1.0)
0.1
—
—
62.2
63.0
(0.8)
0.8
0.4
0.4
(1) Market share estimates are calculated
using IMS data, unless otherwise stated
(2) Total market and market share
estimates include cigarillos in Japan
(3) PMI market share reflects estimated
adjusted IMS volume share
Note: % change for Total Market and PMI
shipments is computed based on millions of units. "-" indicates
volume below 50 million units and market share below 0.1%
Appendix 2
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Key Market Data
Six Months Ended June
30,
Market
Total Market,
bio units
PMI Shipments, bio
units
PMI Market Share(2), %
Total
Cigarette
HTU
Total
HTU
2024
2023
% Change
2024
2023
% Change
2024
2023
% Change
2024
2023
% Change
2024
2023
pp Change
2024
2023
pp Change
Total(1)(2)
1,274.9
1,261.5
1.1
369.5
359.5
2.8
300.8
300.7
—
68.7
58.8
16.8
28.3
27.9
0.4
5.1
4.6
0.5
Europe
France
13.0
15.1
(13.8)
5.9
7.5
(21.7)
5.8
7.4
(21.5)
0.1
0.1
(33.3)
40.9
42.3
(1.4)
0.6
0.8
(0.2)
Germany(3)
33.3
33.7
(1.2)
13.2
12.9
1.9
11.1
11.6
(4.7)
2.1
1.3
61.4
39.4
39.3
0.1
6.2
5.4
0.8
Italy(3)
35.6
35.6
—
18.5
18.7
(0.9)
13.7
13.9
(1.3)
4.8
4.8
—
53.1
53.7
(0.6)
17.2
17.0
0.2
Poland(3)
29.1
28.5
2.3
12.5
11.6
7.9
9.9
9.2
7.8
2.7
2.5
8.4
43.1
41.0
2.1
9.1
9.0
0.1
Spain
20.9
21.2
(1.1)
6.3
6.5
(2.9)
5.8
6.0
(4.2)
0.5
0.4
15.7
29.1
29.1
—
2.7
2.2
0.5
SSEA, CIS & MEA
Egypt
38.4
38.5
(0.3)
12.0
11.7
2.0
11.3
11.3
0.6
0.6
0.5
35.4
30.7
30.4
0.3
1.9
1.4
0.5
Indonesia
145.8
141.4
3.1
39.4
40.5
(2.9)
39.4
40.5
(2.9)
0.5
0.2
+100
27.3
28.8
(1.5)
0.3
0.2
0.1
Philippines
20.0
21.7
(7.9)
10.6
12.3
(14.2)
10.4
12.2
(14.6)
0.1
0.1
30.0
52.8
56.7
(3.9)
0.7
0.5
0.2
Russia
101.9
96.7
5.3
32.9
31.2
5.4
24.4
23.5
3.7
8.5
7.7
10.5
32.0
32.0
—
8.8
8.1
0.7
Turkey
70.1
63.5
10.3
36.3
31.3
16.0
36.3
31.3
16.0
—
—
—
51.9
49.3
2.6
—
—
—
EA, AU & PMI DF
Australia
2.7
3.8
(29.4)
1.0
1.3
(27.2)
1.0
1.3
(27.2)
—
—
—
35.2
34.2
1.0
—
—
—
Japan(2)
73.7
72.9
1.0
35.4
31.5
12.6
8.4
9.6
(12.6)
27.0
21.9
23.6
41.0
39.4
1.6
29.4
26.3
3.1
South Korea
34.7
35.4
(2.1)
6.9
6.9
0.5
4.2
4.4
(5.6)
2.8
2.5
11.7
20.0
19.5
0.5
7.9
6.9
1.0
Americas
Argentina
13.0
15.1
(13.8)
8.0
9.4
(14.7)
8.0
9.4
(14.7)
—
—
—
61.6
62.2
(0.6)
—
—
—
Mexico
13.7
13.5
1.3
8.3
8.3
—
8.2
8.3
(0.6)
0.1
0.1
78.4
61.1
61.9
(0.8)
0.8
0.4
0.4
(1) Market share estimates are calculated
using IMS data, unless otherwise stated
(2) Total market and market share
estimates include cigarillos in Japan
(3) PMI market share reflects estimated
adjusted IMS volume share
Note: % change for Total Market and PMI
shipments is computed based on millions of units. "-" indicates
volume below 50 million units and market share below 0.1%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240722676440/en/
Philip Morris International Investor Relations: Stamford,
CT: +1 (203) 905 2413 Lausanne, Switzerland: +41 582 424 666
InvestorRelations@pmi.com
Media: Lausanne: +41 582 424 500 David.Fraser@pmi.com
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