Philip Morris International Inc. (NYSE: PM) beat earnings estimates for the third quarter of 2019 but revenues missed expectations. Shares were up by 1.1% in premarket hours on Thursday.
Total revenues of $7.64 billion rose 1.8% from last year but fell slightly below forecasts of $7.67 billion.
Reported EPS fell 15.3% year-over-year to $1.22 while adjusted EPS dropped 0.7% to $1.43. Analysts had projected adjusted EPS of $1.36.
During the quarter, cigarette and heated tobacco unit shipment volume fell by 2.1%. Cigarette shipment volume was down by 5.9% while heated tobacco unit shipment volume was up by 84.8%. The market share of heated tobacco units in IQOS markets, excluding the US, rose by 1.3 points to 5.1%.
Andre Calantzopoulos, CEO, said, “The exciting global growth of our heated tobacco products drove our resilient total shipment performance, despite certain timing issues related to our combustible portfolio.”
Cigarette shipment volumes declined across all geographic regions while heated tobacco unit shipments increased across all regions, barring the Middle East and Africa, which saw a drop of 49%. The increase in heated tobacco unit shipment volume was mainly driven by the EU, notably Italy, Eastern Europe, notably Kazakhstan, Russia and Ukraine, as well as Japan.
In the third quarter, revenues increased across most regions except for the Middle East and Latin America regions.
For the full year of 2019, Philip Morris lowered its reported EPS guidance to at least $4.73 versus the prior outlook of at least $4.94. Adjusted EPS is expected to be $5.14. The company expects total cigarette and heated tobacco unit shipment volume for PMI to decline approx. 1% to 1.5% on a like-for-like basis, versus the earlier outlook for a decline of approx. 1%. This is mainly due to the impact of price increases in select markets.
Philip Morris increased its regular quarterly dividend by 2.6% to an annualized rate of $4.68 per common share.