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Philip Morris International's second-quarter smoke-free products accounted for 30% of net revenue

Philip Morris International's second-quarter smoke-free products accounted for 30% of net revenue

2022-07-25

Philip Morris International reported net income of $7.83 billion in the second quarter of 2022, up 3.1% from the comparable quarter in 2021. Operating income was $3.06 billion, compared to $3.13 billion a year earlier. Net revenue from smoke-free products accounted for 29.9% of total net revenue.


PMI jointly shipped 157.69 billion cigarettes and 24.82 billion heated tobacco in the second quarter of 2022, up 1% and 1.9%, respectively, over shipments in the same period in 2021.


Given the uncertainty and volatility caused by the war between Russia and Ukraine, PMI also provides pro forma financial data that excludes the company's operations in these markets, providing a more comparable measure of PMI's business performance view.


On a pro forma basis, the company's net income rose 6.2% between the second quarter of 2021 and the second quarter of 2022, while its operating income rose 1.6%. Net revenue from smokeless products represented 29.9% of total net revenue on a pro forma basis.


The company has suspended its manufacturing operations in Kharkiv, Ukraine, and intends to exit the Russian market. In 2021, Ukraine will account for around 2% of PMI's total cigarette and heated tobacco unit shipments and less than 2% of PMI's total net revenue. Russia accounted for nearly 10% of total shipments and about 6% of PMI's net revenue.


"First, the war in Ukraine continues to deeply impact the lives of our employees and families in the region," PMI CEO Jacek Olczak said in a statement. My priority is to provide them with the help they need, and as a company we are focused on supporting them as best we can during this conflict.


"Turning on our performance, we continued to deliver strong underlying results in the second quarter, with top- and bottom-line growth exceeding our original expectations. This reflects good IQOS momentum, including total IQOS subscribers and heated tobacco unit market volumes accelerated growth, and favorable cigarette category trends.”


"We are raising our outlook for the full year and now expect adjusted net income to grow by an estimated 6% to 8% on an organic basis and diluted earnings per share excluding currency to be 10% to 12%, which supported shipments of 9 billion to 92 billion units of pro forma heated tobacco units.”


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