leadf
logo-loader
viewPhilip Morris International

Philip Morris's earnings hit by dollar strength

The tobacco products maker revised its full-year earnings guidance to reflect exchange rate fluctuation

Used cigarettes
A bit of a choker ... the strength of the dollar affected earnings

Marlboro cigarettes maker Philip Morris International Inc (NYSE:PM) missed market forecasts with its second quarter earnings as currency fluctuations took their toll.

Earnings per share of US$1.14 were one cent lower than in the second quarter of 2016 and nine cents below market expectations.

The cigarettes maker said earnings per share would have been 11 cents higher on a constant currency basis.

Net income clocked in at US$1,781mln, down 0.4% from US$1,788mln the year before.

Net revenues of US$19,319mln were up 1.5% from US$19,041mln.

The bulk of those revenues were taken in excise duties, leaving net revenues of US$6.9bn, up 4% on a year earlier.

The volume of cigarettes shipped fell 7.5% from a year earlier to 193.5bn units.

Reflecting currency movements, the company revised its full-year earnings guidance; analysts should now expect earnings per share to fall within a range of US$4.78 to US$4.93, assuming exchange rates stay as they are. Even the bottom of the range would represent an improvement on 2016’s US$4.48.

"Our quarterly results were robust with, as expected, sequential improvement in our volume performance, as well as strong currency-neutral net revenue growth of 7% versus last year," said André Calantzopoulos, chief executive officer of Philip Morris.

"IQOS, our flagship smoke-free alternative, continues to perform exceptionally well, supported by further recent successful market launches, notably in Korea. In the quarter, shipments of Marlboro HeatSticks represented over 40% of our total shipments in Japan, where we recorded a national share of 10%. To date, more than 2.9 million adult consumers have already stopped smoking and switched to IQOS," he added.

Shares in the tobacco products group were down 0.6% at US$120.84 in pre-market trading.

Quick facts: Philip Morris International

Price: 78.07 USD

NYSE:PM
Market: NYSE
Market Cap: $121.58 billion
Follow

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE

iClima Earth set to launch world’s first carbon avoidance solutions ETF...

iClima Earth's Gabriela Herculano talks to Proactive London about launching the world’s first carbon avoidance solutions ETF alongside HANeft. Herculano says 'the key to what we're doing is CO2e avoidance'. Herculano explains that the 151 companies in the iClima Global Decarbonisation...

1 hour, 10 minutes ago

2 min read