Philip Morris Q2 Results Top View, Backs Full Year Profit Forecast

(RTTNews) - Cigarette maker Philip Morris International Inc. (PM) Thursday reported lower second-quarter profit, along with a slide in reported net revenues that exclude excise taxes. Yet, adjusted earnings and revenues topped estimates.

The company said it achieved strong fundamental results in the quarter, driven by a lower volume decline, strong pricing and robust market share. The firm also backed its full year earnings outlook.

Net earnings attributable to the company slid to $1.85 billion or $1.17 per share from last year's $2.12 billion or $1.30 per share.

Excluding asset impairment and exit costs, adjusted earnings per share were $1.41. Excluding unfavorable currency of $0.15, adjusted earnings per share totaled $1.56 in the just concluded period.

On average, 11 analysts polled by Thomson Reuters expected earnings per share of $1.24. Analysts' estimates typically exclude one-time items.

Net revenue grew 2.8 percent to $21.05 billion from the prior-year figure of $20.48 billion.

Reported net revenues, excluding excise taxes, slid 1.5 percent to $7.8 billion from $7.92 billion. Analysts expected revenues of $7.52 billion.

Cigarette shipment volume fell 2.7 percent to 222.8 billion units. Total cigarette shipments of Marlboro rose 1 percent, and L&M shipment slid 3.5 percent.

While European Union saw a 2.4 percent rise in shipment volume, Eastern Europe, Middle East & Africa witnessed a 2.8 percent drop. Asia and Latin America & Canada saw declines of 6.1 percent and 1 percent, respectively.

André Calantzopoulos, CEO, said, "For the second half of this year, we anticipate more challenging quarterly comparisons, particularly in the fourth quarter... due to known business challenges, particularly in Asia, the timing of investments behind the commercialization of our Reduced-Risk Products and the roll-out of Marlboro Red 2.0, as well as costs related to our manufacturing footprint optimization initiatives."

Looking forward, the company confirmed its 2014 reported earnings per share outlook of $4.87 - $4.97 issued last month, compared to $5.26 in 2013.

Adjusted earnings per share are projected to grow 6 to 8 percent from last year's $5.40 per share. Analysts project annual earnings of $5.14 per share.

PM closed up 0.1 percent on Wednesday at $84.70.