PMI volumes down by 3.9 percent

Philip Morris International’s cigarette shipment volume during the second quarter to the end of June, at 228,899 million, was down by 3.9 percent on that of the second quarter of 2012.

Volume was down in all of the company’s regions: by 3.5 percent to 80,588 million in Asia; by 3.6 percent to 76,298 million in Eastern Europe, Middle East & Africa (EEMEA); by 5.9 percent to 48,723 million in the EU; and by 2.4 percent to 23,290 million in Latin America & Canada (LAC).

Without what PMI described at the disruptive January 2013 tax increase in the Philippines, overall, the company’s volume decline would have been 2.6 percent rather than 3.9 percent.

Total cigarette shipments of Marlboro were down by 5.9 percent to 72.7 billion, while those of L&M increased by 6.1 percent to 25.1 billion.

Cigarette shipments of Bond Street decreased by 8.9 percent to 11.6 billion; those of Philip Morris decreased by 8.5 percent to 8.8 billion; those of Parliament increased by 4.0 percent to 11.5 billion; those of Chesterfield fell by 7.9 percent to 8.9 billion; and those of Lark decreased by 7.9 percent to 7.9 billion.

PMI’s shipment volume of OTP (other tobacco products), in cigarette equivalent units, increased by 3.0 percent, while shipment volume for cigarettes and OTP in cigarette equivalents decreased by 3.7 percent.

Reported diluted earnings per share during the second quarter, at $1.30, were down by 4.4 percent on those of the second quarter of 2012.

Reported net revenues, excluding excise taxes, were down by 2.5 percent to $7.9 billion and reported operating income was down by 7.5 percent to $3.3 billion.

“As expected, despite strong pricing and a robust share performance, our second-quarter results were primarily impacted by lower industry volume in several key markets, as well as the timing of inventory movements in Japan, higher costs—predominantly in Asia—and stiffer currency headwinds,” said CEO André Calantzopoulos.

“For the second half of the year, we expect volume/mix to improve, pricing to remain strong and our total cost variance, excluding currency, to be flat. While industry volume remains a challenge, our underlying business performance is such that we continue to expect to meet our mid- to long-term currency-neutral adjusted diluted EPS growth rate target of 10–12 percent in 2013.”

Meanwhile, PMI’s cigarette volume shipments during the six months to the end of June, at 433,846 million, were down by 5.1 percent on those of the first six months of 2012.

Shipments were down by 6.9 percent to 153,207 million in Asia; by 1.3 percent to 143,132 million in EEMEA; by 7.9 percent to 91,690 million in the EU; and by 5.0 percent to 45,817 million in LAC.