Philip Morris International (PM: Quote) on Thursday reported a rise in profit for the first quarter, as sales improved, led by Asia, amid volume growth and favorable pricing. The cigarette maker, however, trimmed its full-year view to reflect currency impact.
Louis Camilleri, Chairman and CEO, said, "We have begun 2012 with strong momentum, driven by our best quarterly organic volume performance since the spin-off in March 2008."
Net earnings attributable to the company, whose portfolio include Marlboro, Parliament and Virginia Slims brands of cigarettes, increased to $2.16 billion or $1.25 per share from $1.92 billion or $1.06 per share in the prior year.
On average, 13 analysts polled by Thomson Reuters expected the company to report earnings of $1.19 per share. Analysts' estimates typically exclude special items.
Net revenues grew to $18.02 billion from $16.53 billion last year. Reported net revenues, excluding excise taxes, increased 9.7 percent to $7.45 billion from $6.79 billion. Analysts estimated revenues of $7.22 billion.
Excluding currency, net revenues increased by 11 percent, driven by favorable pricing of $369 million and favorable volume/mix of $370 million.
Revenue growth was the strongest in Asia, where the company generated $2.78 billion, up 19.5 percent from last year. Eastern Europe, Middle East & Africa, or EEMA, reported a growth of 8.8 percent and revenue increased 2.6 percent in European Union.
Cigarette shipment volume grew 5.4 percent or 5.3 percent excluding acquisitions. The increase was driven by growth from all top 10 cigarette brands. It is estimated that cigarette shipment volume grew about 1 percent due to the leap year effect.
Marlboro shipments grew 5.2 percent, helped by growth in EEMA and Asia. Shipments of L&M were up 4.4 percent, reflecting growth in the EU, Asia and Latin America & Canada, and a nearly flat performance in EEMA.
Looking ahead, for prevailing exchange rates, the company revised its 2012 reported earnings per share forecast to a range of $5.20 - $5.30, compared to $4.85 in 2011.
Excluding a forecasted total unfavorable currency impact of $0.15, reported earnings per share are projected to increase by 10 percent - 12 percent, compared to adjusted earnings per share of $4.88 in 2011.
Earlier, the company expected 2012 earnings in a range of $5.25 - $5.35 per share. Excluding unfavorable currency impact, earnings were projected to increase by about 10 - 12 percent from $4.88 in fiscal year 2011. Analysts expect the company to earn $5.30 per share.
PM closed on Wednesday at $87.74, compared to the previous close of $87.45, on a volume of 4.86 million shares.
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by RTT Staff Writer
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