Higher Income, Lower Revenues for PMI
Philip Morris International (PMI) reported operating income of $11.69 billion in 2020, up 10.8 percent over 2019. Net revenues were down 3.7 percent to $28.69 billion for the full year.
PMI sold 628.52 billion cigarettes in 2020, down 11 percent 11.1 percent from 706.71 billion in 2019. The company’s shipments of heated tobacco units (HTU) increased 27.6 percent to 76.11 billion in 2020. Its combined volume of cigarettes and HTUs was 704.63 billion in 2020, 8.1 percent less than in the previous year. Sales of PMI’s flagship Marlboro brand declined by 11.3 percent to 233.16 billion cigarettes.
“In 2020, PMI delivered a robust business performance despite the unprecedented headwinds of the Covid-19 pandemic, with adjusted diluted EPS [earnings per share] organic growth of 7.0 percent, supported by stronger-than-anticipated fourth quarter results,” said André Calantzopoulos, chief executive officer, in a statement.
“IQOS continued to deliver impressive growth in 2020, driving significant increases in our total users, as well as both HTU shipment and in-market sales volumes. During the fourth quarter, we reported record HTU market shares in key IQOS geographies and exited the year with double-digit national shares in ten markets.”
“We enter 2021 with favorable momentum, although certain headwinds remain, notably related to Duty Free, Indonesia and the continued effects of the pandemic. For the full year, we are expecting a significant recovery, with mid-single-digit organic net revenue growth—driven by the growing contribution of IQOS—and further efforts on cost efficiencies driving an acceleration in forecasted adjusted diluted EPS growth to a range of 9 percent to 11 percent on the same basis.”
PMI said it has sufficient access to the inputs for its products and is not facing any significant business continuity issues with respect to key suppliers. All of PMI’s cigarette and heated tobacco unit manufacturing facilities globally are operational, and Covid-related restrictions do not have a significant impact on the availability of PMI’s products to its customers and adult consumers.
PMI will host a live video webcast of presentations and Q&A session by senior management at its 2021 investor day on Feb. 10, 2021. The webcast will be held in a virtual format and provide live video of the entire session beginning on Wednesday, Feb. 10, 2021, at approximately 8:30 a.m. EST and concluding at approximately 1:30 p.m. EST. An archive of the webcast will be available on the company’s website until 5 p.m. EST on March 11, 2021. A copy of the slides and full transcript will be made available on the company website