Tags: Philip Morris | Earnings | Profit | Revenue

Philip Morris Earnings Top Estimates After Cigarette Prices Rise

Thursday, 16 Oct 2014 07:44 AM


Philip Morris International Inc., the world’s largest publicly traded tobacco company, beat profit estimates after price increases and market-share gains helped make up for a small decline in cigarette volumes.

Third-quarter net income fell 7.9 percent to $2.16 billion, or $1.38 a share, from $2.34 billion, or $1.44, a year earlier, the New York-based maker of Marlboro cigarettes said in a statement. Excluding some items, profit was $1.39 a share in the period. The average of 11 analysts’ estimates compiled by Bloomberg was $1.33.

Philip Morris, which gets all its revenue outside the U.S., has been raising prices to offset a reduction in smoking. That helped net revenue climb 3.4 percent to $21.3 billion, even as cigarette shipment volume declined 0.4 percent, excluding acquisitions.

“Our results in the third quarter were slightly better than we expected, underpinned by a modest decline in volume, continued robust pricing and solid market share gains in each of our four regions,” Chief Executive Officer Andre Calantzopoulos said in the statement.

Revenue excluding excise taxes amounted to $7.86 billion, exceeding analysts’ $7.61 billion average estimate.

Even so, Philip Morris cut its profit forecast, citing currency headwinds. Earnings this year will be $4.76 to $4.81 a share, Philip Morris said. That compares with a July forecast of $4.87 to $4.97.

The stock fell 0.1 percent to $83.58 yesterday in New York. Philip Morris’ shares dropped 4.1 percent this year through yesterday, compared with a 0.8 percent gain for the Standard & Poor’s 500 Index.

The earnings come as U.S. antitrust officials evaluate a blockbuster tobacco deal. Reynolds American Inc. agreed in July to buy U.S. rival Lorillard Inc. for about $25 billion. If the transaction is cleared, the transaction will leave 90 percent of the 400-year-old American tobacco industry with two competitors: Reynolds and Altria Group Inc.

Altria, the U.S. tobacco leader, spun off Philip Morris International in 2008 so it could focus on the domestic market.


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Philip Morris International Inc., the world's largest publicly traded tobacco company, beat profit estimates after price increases and market-share gains helped make up for a small decline in cigarette volumes.
Philip Morris, Earnings, Profit, Revenue
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2014-44-16
Thursday, 16 Oct 2014 07:44 AM
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