Philip Morris Misses Q1 Revenue And EPS Estimates

On Tuesday, cigarette giant Philip Morris International (NYSE:PM) declared its first quarter results, which were well below analyst estimates. Reported revenues of $6.08 billion, missed estimates by over 4%. This was mainly due to a pricing variance of just $272 million, which was a massive decline from 2015 figures, when the lowest quarterly pricing variance was $466 million. Despite a weakening dollar, currency still played a dampener, negatively affecting the quarterly revenue and EPS. The EPS was also impacted by a 160 basis points fall in gross margins. The company increased its EPS guidance for the year to $4.40-$4.50, due to a lower foreign currency impact than anticipated. Philip Morris managed to increase its shipment volumes in three of its four markets. In Asia, the decline was primarily due to a 5.9% shipment decline in Indonesia, as a result of a weak economy and price increase of 11% in the quarter. Declines were also seen in the Philippines and Pakistan. An EU shipment volume increase reflects improving economies, a decline in illicit trade, and a lower prevalence of e-vapor products. Growth in Latin America and the Canada region was principally driven by Mexico, while slow growth in the EEMA region reflected economic and geopolitical uncertainty in Ukraine, and excise tax-driven retail price increases in Algeria and Russia.

Have more questions on Philip Morris? See the links below:

• Will Philip Morris Beat Expectations This Earnings Season?
• How Did Philip Morris Perform In The European Union, And Its Key Markets There, In 2015?
• How Did Philip Morris Perform In Russia, Given The Currency Headwinds And Excise Tax Rise?
• How Has Philip Morris Fared In Comparison To Its Peers?
• How Has Philip Morris’ Shipment Volume, By Brand, Changed Over The Past 3 Years?
• How Has Philip Morris’ Revenue And EBITDA Composition Changed In The Last 5 Years?
• How Will Philip Morris’ Revenue And EBITDA Change In The Next 3 Years?
• Philip Morris: Year 2015 In Review
• By What Percentage Did Philip Morris’ Revenue & EBITDA Change In The Last 5 Years?
• What is Philip Morris’ Fundamental Value Based On Expected 2016 Results?
• What is Philip Morris’ Revenue And EBITDA Breakdown?

Notes: