Yahoo Finanza Philip Morris International Inc. (PM) Reports First-Quarter 2024 Results: Aligns with EPS ...
Reported Diluted EPS: $1.38, up 7.8% from the previous year, falling short of the estimated $1.41.
Adjusted Diluted EPS: $1.50, reflecting an 8.7% increase, and $1.70 excluding currency impacts, surpassing the quarterly estimate.
Total Net Revenues: $8.8 billion, a 9.7% increase from the previous year, exceeding the estimated $8.468 billion.
Gross Profit: Reached $5.6 billion, marking a 12.4% increase from the previous year, driven by strong performance in smoke-free products.
Smoke-Free Products Revenue: Accounted for 39% of total net revenues, with a 21.1% increase in the smoke-free segment.
Operating Income: Reported at $3.0 billion, up 11.5% from the previous year, with organic growth of 22.2%.
Dividend: Announced a regular quarterly dividend of $1.30 per share, maintaining an annualized rate of $5.20 per share.
On April 23, 2024, Philip Morris International Inc. (NYSE:PM) released its 8-K filing, announcing the first-quarter results for 2024. The company reported a diluted EPS of $1.38, closely aligning with the analyst estimates of $1.41 per share. However, it surpassed revenue expectations with a reported $8.8 billion against the forecasted $8.47 billion, indicating a robust top-line growth driven significantly by its smoke-free products.
Company Overview
Philip Morris International is a leading international tobacco company, known for its extensive range of cigarettes and innovative smoke-free products. These include heat-not-burn devices, vapor products, and oral nicotine solutions, primarily marketed outside the United States. The company has been diversifying its portfolio through strategic acquisitions such as Swedish Match and Vectura, enhancing its footprint in the oral nicotine and healthcare sectors respectively.
Performance Highlights and Strategic Initiatives
The first quarter of 2024 saw Philip Morris's smoke-free business (SFB) contribute 39% to its total net revenues, with significant strides in markets like Japan and Korea. The company's flagship smoke-free product, IQOS, achieved a market share of over 29% in Japan, underscoring its growing acceptance. Furthermore, the oral smoke-free products, particularly ZYN nicotine pouches, experienced a remarkable shipment volume increase of 40.0% in cans, showcasing strong consumer demand in the U.S. market.
Despite challenges posed by geopolitical tensions and economic uncertainties, CEO Jacek Olczak remains optimistic about the company's trajectory, stating,
The strength of our first-quarter results with excellent top-line growth and significant margin expansion gives us the confidence to raise our 2024 currency-neutral guidance."
This sentiment is bolstered by the company's proactive strategies to mitigate currency volatility and enhance operational efficiencies.
Financial Performance Analysis
Philip Morris's financials reflect a solid performance with a total net revenue growth of 9.7% from the previous year, and an organic increase of 11.0%. The gross profit rose by 12.4%, with an organic growth of 13.7%, driven predominantly by the high-margin smoke-free segment. Adjusted operating income also saw a substantial increase of 22.2% on an organic basis, highlighting effective cost management and strategic pricing initiatives.
The company's commitment to shareholder returns remains strong, as evidenced by the declared quarterly dividend of $1.30 per share. This aligns with their ongoing financial strategy and commitment to delivering value to shareholders.
Looking Ahead: 2024 Full-Year Forecast
Philip Morris has updated its full-year guidance for 2024, projecting an adjusted diluted EPS in the range of $5.70 to $5.82, reflecting an optimistic 9.0% to 11.0% increase from the previous year. The forecast is based on expected industry volume dynamics, continued growth in smoke-free product segments, and strategic pricing decisions across its portfolio.
The company anticipates a stable performance in its Wellness and Healthcare segment, despite facing operational challenges. The focus will remain on integrating the Swedish Match business effectively and leveraging the growth potential of the smoke-free product market.
In conclusion, Philip Morris International Inc. (NYSE:PM) is navigating a complex market landscape with a clear strategic direction and robust product offerings. The company's strong Q1 performance and positive outlook for 2024 reflect its resilience and adaptability in a dynamic global market, making it a noteworthy entity for investors and stakeholders in the tobacco industry.
Explore the complete 8-K earnings release (here) from Philip Morris International Inc for further details.
This article first appeared on GuruFocus.
