INTERNATIONAL & USA PRESS INQUIRIES
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May 24, 2019
Philip Morris International Inc. (PMI) Reports 2008 Results
2008 Full-Year
-
Full-year diluted earnings per share of
$3.32 , up 16.1% from$2.86 in 2007, including the items detailed on Schedule 8 -
Adjusted 2008 full-year diluted earnings per share of
$3.32 , up 18.6% from the 2007 pro-forma adjusted earnings per share of$2.80 . Excluding currency, adjusted 2008 full-year diluted earnings per share were up 13.2%
2008 Fourth-Quarter
-
Fourth-quarter diluted earnings per share of
$0.71 , down 4.1% from$0.74 for the same period in 2007, including the items detailed on Schedule 7 -
Adjusted fourth-quarter diluted earnings per share of
$0.71 , down 1.4% for the same period in 2007 from the pro-forma adjusted earnings per share of$0.72 . Excluding currency, adjusted fourth-quarter diluted earnings per share were up 12.5% -
Spent a total of
$5.4 billion to repurchase 106.8 million shares of its common stock in 2008; increased the dividend by 17.4% in 2008 to an annualized rate of$2.16 per share -
During 2008, acquired
Rothmans Inc. ofCanada and the fine cut trademark Interval -
Forecasts 2009 full-year diluted earnings per share to a range of
$2.85 to $3.00 , at current exchange rates, versus$3.32 in 2008. Excluding an adverse currency impact of$0.80 per share, 2009 guidance is projected to increase by 10%-14% -
As announced on
February 3, 2009 , PMI entered into an exclusive 50:50 joint venture agreement withSwedish Match AB to commercialize smoke-free tobacco products worldwide, excluding Scandinavia and theUSA -
Announces an agreement to acquire the rights to the Petteroes trademark,
the leading fine cut brand in
Norway
“Our operating performance in 2008 was exceptionally strong and our
results exceeded our constant currency growth targets for both the full
year and the fourth quarter. Our first year as an independent company
was also marked by significant progress on numerous strategic fronts and
specifically behind our efforts to improve our speed to market and
enhance the vibrancy and equity of our strong brand portfolio," said
"The global economic crisis obviously results in uncertainty, particularly on the currency front, and at current exchange rates we face a steep hurdle. Nevertheless, we enter 2009 with solid momentum and confident in our ability to meet our constant currency income growth targets. Our commitment to judiciously invest in the growth of our business and deliver superior returns to our shareholders over the long term remains as steadfast as ever."
Conference Call
A conference call, hosted by
Dividends and Share Repurchase Program
During the fourth quarter, PMI announced a regular quarterly dividend of
In the fourth-quarter, PMI spent
Acquisitions
In 2008, PMI acquired all of the outstanding common shares of
During the year, PMI also acquired the fine cut trademark Interval
for
Certain PMI Subsidiaries Revise their Closing Date
Prior to 2008, certain of PMI’s subsidiaries reported their results up
to ten days before the end of December, rather than on
PMI Enters into Agreement with
As separately announced on
PMI has further licensed to SWMA certain PMI trademarks in
Acquisition of Petteroes
PMI has reached an agreement to acquire the rights to the Petteroes fine
cut tobacco trademark worldwide and other cigarette trademarks sold
primarily in
In 2008, Petteroes had a 58% share of the Norwegian roll-your-own
segment and a 7% share of the cigarette category. The brand recorded net
revenues, excluding excise taxes, of approximately NOK 370 million (
The transaction is subject to approval by the
2009 Full-Year Forecast
PMI forecasts 2009 full-year diluted earnings per share to a range of
The factors described in the Forward-Looking and Cautionary Statements section of this release represent continuing risks to this projection.
2008 FULL-YEAR AND FOURTH-QUARTER CONSOLIDATED RESULTS
Management reviews operating companies income, which is defined as operating income before corporate expenses and amortization of intangibles, to evaluate segment performance and to allocate resources. Management believes it is appropriate to disclose this measure to help investors analyze business performance and trends. For a reconciliation of operating companies income to operating income, see the Condensed Statements of Earnings contained in this release. References to international tobacco market shares are PMI estimates based on a number of sources.
NET REVENUES*
PMI Net Revenues* ($ Millions) |
||||||||||||
Full Year |
Fourth Quarter |
|||||||||||
2008 |
2007 |
Change |
2008 |
2007 |
Change |
|||||||
European Union | $9,688 | $8,835 | 9.7% | $2,127 | $2,262 | (6.0)% | ||||||
Eastern Europe, Middle East & Africa | 7,504 | 6,346 | 18.2% | 1,800 | 1,664 | 8.2% | ||||||
Asia | 6,185 | 5,648 | 9.5% | 1,468 | 1,405 | 4.5% | ||||||
Latin America & Canada |
2,328 |
1,981 |
17.5% |
727 |
576 |
26.2% | ||||||
Total PMI | $25,705 | $22,810 | 12.7% | $6,122 | $5,907 | 3.6% | ||||||
Total PMI (excl. currency) | 6.6% | 8.5% |
* Net revenues, excluding excise taxes.
Reported net revenues, excluding excise taxes, of
In the fourth quarter, reported net revenues, excluding excise taxes, of
OPERATING COMPANIES INCOME
PMI Operating Companies Income ($ Millions) |
||||||||||||
Full Year |
Fourth Quarter |
|||||||||||
2008 |
2007 |
Change |
2008 |
2007 |
Change |
|||||||
European Union | $4,738 | $4,195 | 12.9% | $959 | $1,059 | (9.4)% | ||||||
Eastern Europe, Middle East & Africa | 3,119 | 2,431 | 28.3% | 680 | 628 | 8.3% | ||||||
Asia | 2,057 | 1,803 | 14.1% | 426 | 424 | 0.5% | ||||||
Latin America & Canada |
520 |
514 |
1.2% |
238 |
190 |
25.3% | ||||||
Total PMI | $10,434 | $8,943 | 16.7% | $2,303 | $2,301 | 0.1% | ||||||
Total PMI (excl. currency) | 11.3% | 10.4% |
Reported operating companies income increased 16.7% to
Fourth-quarter 2008 reported operating companies income was essentially
flat at
PMI Operating Companies Income ($ Millions) |
||||||||||||
Full Year |
Fourth Quarter |
|||||||||||
2008 |
2007 |
Change |
2008 |
2007 |
Change |
|||||||
Reported Operating Companies Income | $10,434 | $8,943 | 16.7% | $2,303 | $2,301 | 0.1% | ||||||
Asset impairment and exit costs | 84 | 195 | 0 | 42 | ||||||||
Equity loss from RBH* legal settlement | 124 | 0 | 0 | 0 | ||||||||
Adjusted Operating Companies Income | $10,642 | $9,138 | 16.5% | $2,303 | $2,343 | (1.7)% | ||||||
Adjusted OCI Margin** | 41.4% | 40.1% | 1.3 pp | 37.6% | 39.7% | (2.1) pp |
*
**Margins are calculated as adjusted operating companies income, divided by net revenues, excluding excise taxes.
SHIPMENT VOLUME & MARKET SHARE
PMI Cigarette Shipment Volume by Segment (Million Units) |
||||||||||||
Full Year |
Fourth Quarter |
|||||||||||
2008 |
2007 |
Change |
2008 |
2007 |
Change |
|||||||
European Union | 243,451 | 257,541 | (5.5)% | 57,520 | 62,938 | (8.6)% | ||||||
Eastern Europe, Middle East & Africa | 303,205 | 290,310 | 4.4% | 75,626 | 72,152 | 4.8% | ||||||
Asia | 223,724 | 211,480 | 5.8% | 55,373 | 52,533 | 5.4% | ||||||
Latin America & Canada |
99,377 |
89,307 |
11.3% |
28,688 |
25,322 |
13.3% | ||||||
Total PMI | 869,757 | 848,638 | 2.5% | 217,207 | 212,945 | 2.0% |
2008 Full-Year Results
PMI cigarette shipment volume of 869.8 billion units was up 2.5% for the
full-year 2008. On an organic basis, excluding acquisitions, PMI’s
cigarette shipment volume was up 1.0%, benefiting from strong
performances in EEMA,
Total cigarette shipments of L&M of 92.4 billion units were
down 4.6%, mainly due to a decline in EEMA, partially offset by growth
in the EU. Led by double-digit growth in EEMA and an increase in the EU,
total cigarette shipments of Chesterfield grew 13.7%. Total
cigarette shipments of Parliament recorded strong growth, up
20.0%, led by gains in EEMA and
Shipment volume of other tobacco products (in cigarette equivalent
units) grew 30.9%, driven by strong growth in
Total shipment volume for cigarettes and other tobacco products was up 2.8%, or up 1.2% excluding acquisitions.
PMI’s full-year market share performance improved versus 2007 in a
number of markets, including
2008 Fourth-Quarter Results
PMI cigarette shipment volume of 217.2 billion units was up 2.0%, driven
by EEMA,
Total cigarette shipments of
Total cigarette shipments of L&M of 22.0 billion units were
down 4.0%, mainly due to a decline in EEMA. Total cigarette shipments of Chesterfield
grew 4.8% versus the prior-year quarter, driven by continued growth in
the EU and EEMA. Total cigarette shipments of Parliament
continued to record strong growth, up 16.4%, led by gains in EEMA and
Shipment volume of other tobacco products (in cigarette equivalent
units) grew 30.0%, driven by strong growth in
Total shipment volume for cigarettes and other tobacco products was up 2.4%, or up 0.6% excluding acquisitions.
PMI’s market share performance improved versus the same period in 2007
in a number of markets, including
EUROPEAN UNION (EU)
2008 Full-Year Results
In the EU, net revenues, excluding excise taxes, increased by 9.7% to
reach
Operating companies income grew by 12.9% to
The total cigarette market in the EU declined by 4.8%. Adjusted for the
PMI’s cigarette shipment volume in the EU declined by 5.5%, reflecting a
lower total market. Absent the distortions in the
2008 Fourth-Quarter Results
Net revenues, excluding excise taxes, declined by 6.0% to
Operating companies income declined by 9.4% to
The total cigarette market in the EU declined by 8.7%, impacted by the unfavorable factors mentioned above for the full year. Adjusted for these factors, the total cigarette market in the EU was down 3.1%.
PMI’s cigarette shipment volume in the EU declined by 8.6%, reflecting a
lower total market. PMI’s share was essentially flat at 39.3%. However,
EU Operating Companies Income ($ Millions) |
||||||||||||
Full Year |
Fourth Quarter |
|||||||||||
2008 |
2007 |
Change |
2008 |
2007 |
Change |
|||||||
Reported Operating Companies Income | $4,738 | $4,195 | 12.9% | $959 | $1,059 | (9.4)% | ||||||
Asset impairment and exit costs | 66 | 137 | 0 | 36 | ||||||||
Adjusted Operating Companies Income | $4,804 | $4,332 | 10.9% | $959 | $1,095 | (12.4)% | ||||||
Adjusted OCI Margin* | 49.6% | 49.0% | 0.6 pp | 45.1% | 48.4% | (3.3) pp |
*Margins are calculated as adjusted operating companies income, divided by net revenues, excluding excise taxes.
EU Key Market Commentaries
In
In
In
In
In
2008 Full-Year Results
In EEMA, net revenues, excluding excise taxes, increased by 18.2% to
reach
Operating companies income surged 28.3%, including favorable currency of
PMI’s cigarette shipment volume increased 4.4%, driven by gains in
2008 Fourth-Quarter Results
Net revenues, excluding excise taxes, increased by 8.2% to reach
Operating companies income grew 8.3%, including unfavorable currency of
In the fourth quarter, PMI’s cigarette shipment volume increased 4.8%,
driven by
EEMA Operating Companies Income ($ Millions) |
||||||||||||
Full Year |
Fourth Quarter |
|||||||||||
2008 |
2007 |
Change |
2008 |
2007 |
Change |
|||||||
Reported Operating Companies Income | $3,119 | $2,431 | 28.3% | $680 | $628 | 8.3% | ||||||
Asset impairment and exit costs | 1 | 12 | 0 | 0 | ||||||||
Adjusted Operating Companies Income | $3,120 | $2,443 | 27.7% | $680 | $628 | 8.3% | ||||||
Adjusted OCI Margin* | 41.6% | 38.5% | 3.1 pp | 37.8% | 37.7% | 0.1 pp |
*Margins are calculated as adjusted operating companies income, divided by net revenues, excluding excise taxes.
EEMA Key Market Commentaries
In
In
In
2008 Full-Year Results
In
Operating companies income grew 14.1% to
PMI’s cigarette shipment volume increased 5.8%, due to gains in
2008 Fourth-Quarter Results
In the fourth quarter, net revenues, excluding excise taxes, increased
by 4.5% to reach
In the fourth quarter, operating companies income was up 0.5%, due
primarily to higher pricing and favorable volume mix, partially offset
by increased expenditures in marketing, trade and selling activities,
principally in
In the fourth quarter, PMI’s cigarette shipment volume increased 5.4%,
reflecting gains in
Asia Operating Companies Income ($ Millions) |
||||||||||||
Full Year |
Fourth Quarter |
|||||||||||
2008 |
2007 |
Change |
2008 |
2007 |
Change |
|||||||
Reported Operating Companies Income | $2,057 | $1,803 | 14.1% | $426 | $424 | 0.5% | ||||||
Asset impairment and exit costs | 14 | 28 | 0 | 6 | ||||||||
Adjusted Operating Companies Income | $2,071 | $1,831 | 13.1% | $426 | $430 | (0.9)% | ||||||
Adjusted OCI Margin* | 33.5% | 32.4% | 1.1 pp | 29.0% | 30.6% | (1.6) pp |
*Margins are calculated as adjusted operating companies income, divided by net revenues, excluding excise taxes.
Asia Key Market Commentaries
In
In
In Korea, the total market was up 3.6% in 2008 and PMI’s shipment volume
increased 24.9%, driven by market share increases. Following a record
market share of 12.3% in the fourth quarter, up 2.0 share points
compared to the prior year, PMI’s share in 2008 reached 11.8%, up 2.0
share points, due mainly to the continued strong performance of Parliament,
up 1.4 share points,
2008 Full-Year Results
In
Operating companies income grew 1.2% to
Cigarette shipment volume increased by 11.3%, primarily
reflecting gains in
2008 Fourth-Quarter Results
Net revenues, excluding excise taxes, increased by 26.2% to reach
Operating companies income increased 25.3%, due primarily to the favorable impact of the Canadian acquisition. Excluding the impact of currency and acquisitions, adjusted operating companies income grew 4.7%.
Cigarette shipment volume increased by 13.3%, reflecting the same factors as for the total year. Excluding acquisitions, shipments increased 1.4%.
Latin America & Canada Operating Companies Income ($ Millions) |
||||||||||||
Full Year |
Fourth Quarter |
|||||||||||
2008 |
2007 |
Change |
2008 |
2007 |
Change |
|||||||
Reported Operating Companies Income | $520 | $514 | 1.2% | $238 | $190 | 25.3% | ||||||
Asset impairment and exit costs | 3 | 18 | 0 | 0 | ||||||||
Equity loss from RBH* legal settlement | 124 | 0 | 0 | 0 | ||||||||
Adjusted Operating Companies Income | $647 | $532 | 21.6% | $238 | $190 | 25.3% | ||||||
Adjusted OCI Margin** | 27.8% | 26.9% | 0.9 pp | 32.7% | 33.0% | (0.3) pp |
*
**Margins are calculated as adjusted operating companies income, divided by net revenues, excluding excise taxes.
In
In
In
Trademarks and service marks mentioned in this release are the
registered property of, or licensed by, the subsidiaries of
A complete copy of PMI’s audited 2008 financial statements will be
available through PMI’s website after they are filed with the
Forward-Looking and Cautionary Statements
This press release contains projections of future results and other forward-looking statements that involve a number of risks and uncertainties and are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. The following important factors could cause actual results and outcomes to differ materially from those contained in such forward-looking statements.
PMI is also subject to legislation and governmental regulation, including actual and potential excise tax increases; discriminatory excise tax structures; increasing marketing and regulatory restrictions; the effects of price increases related to excise tax increases on consumption rates and consumer preferences within price segments; health concerns relating to the use of tobacco products and exposure to environmental tobacco smoke; privately imposed smoking restrictions; and governmental investigations.
PMI is subject to litigation, including risks associated with adverse jury and judicial determinations, and courts reaching conclusions at variance with the company’s understanding of applicable law. It is possible that PMI’s consolidated results of operations, cash flows or financial position could be materially affected in a particular fiscal quarter or fiscal year by an unfavorable outcome or settlement of certain pending litigation.
PMI is further subject to other risks detailed from time to time in its
publicly filed documents, including the Form 10 and its Quarterly Report
on Form 10-Q for the period ended
Schedule 1 | ||||||||||||
PHILIP MORRIS INTERNATIONAL INC. | ||||||||||||
and Subsidiaries | ||||||||||||
Condensed Statements of Earnings (1) | ||||||||||||
For the Quarters Ended December 31, | ||||||||||||
(in millions, except per share data) | ||||||||||||
(Unaudited) | ||||||||||||
2008 | 2007 | % Change | ||||||||||
Net revenues | $ | 15,218 | $ | 14,893 | 2.2 | % | ||||||
Cost of sales | 2,204 | 2,244 | (1.8 | ) | % | |||||||
Excise taxes on products (2) | 9,096 | 8,986 | 1.2 | % | ||||||||
Gross profit | 3,918 | 3,663 | 7.0 | % | ||||||||
Marketing, administration and research costs | 1,615 | 1,320 | ||||||||||
Asset impairment and exit costs | - | 42 | ||||||||||
Operating companies income | 2,303 | 2,301 | 0.1 | % | ||||||||
Amortization of intangibles | 15 | 10 | ||||||||||
Gain on sale of leasing business | - | (52 | ) | |||||||||
General corporate expenses | 62 | 9 | ||||||||||
Asset impairment and exit costs | - | 13 | ||||||||||
Operating income | 2,226 | 2,321 | (4.1 | ) | % | |||||||
Interest expense, net | 106 | 13 | ||||||||||
Earnings before income taxes and minority interest | 2,120 | 2,308 | (8.1 | ) | % | |||||||
Provision for income taxes | 605 | 654 | (7.5 | ) | % | |||||||
Earnings before minority interest | 1,515 | 1,654 | (8.4 | ) | % | |||||||
Minority interest in earnings, net of income taxes | 70 | 87 | ||||||||||
Net earnings | $ | 1,445 | $ | 1,567 | (7.8 | ) | % | |||||
Per share data: | ||||||||||||
Basic earnings per share | $ | 0.72 | $ | 0.74 | (2.7 | ) | % | |||||
Diluted earnings per share | $ | 0.71 | $ | 0.74 | (4.1 | ) | % | |||||
Weighted average number of | ||||||||||||
shares outstanding | ||||||||||||
- Basic (3) | 2,020 | 2,109 | (4.2 | ) | % | |||||||
- Diluted (3) | 2,031 | 2,109 | (3.7 | ) | % | |||||||
(1) Results have been revised to reflect the movement of certain | ||||||||||||
subsidiaries to a December 31 closing date. See Schedule 11 | ||||||||||||
for more information. | ||||||||||||
(2) The segment detail of excise taxes on products sold for the | ||||||||||||
quarters ended December 31, 2008 and 2007 is shown on | ||||||||||||
Schedule 2. | ||||||||||||
(3) For the quarter ended December 31, 2007, basic and diluted | ||||||||||||
earnings per share are calculated based on the number of our | ||||||||||||
shares distributed by Altria on the Distribution Date. |
Schedule 2 | ||||||||||||||||||||
PHILIP MORRIS INTERNATIONAL INC. | ||||||||||||||||||||
and Subsidiaries | ||||||||||||||||||||
Selected Financial Data by Business Segment | ||||||||||||||||||||
For the Quarters Ended December 31, | ||||||||||||||||||||
(in millions) | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||
Net Revenues (1) | ||||||||||||||||||||
Latin | ||||||||||||||||||||
European | America & | |||||||||||||||||||
Union | EEMA | Asia | Canada | Total | ||||||||||||||||
2008 | $ | 6,838 | $ | 3,569 | $ | 2,888 | $ | 1,923 | $ | 15,218 | ||||||||||
2007 | 7,190 | 3,273 | 2,894 | 1,536 | 14,893 | |||||||||||||||
% Change | (4.9 | )% | 9.0 | % | (0.2 | )% | 25.2 | % | 2.2 | % | ||||||||||
Reconciliation: |
||||||||||||||||||||
For the quarter ended December 31, 2007 | $ | 7,190 | $ | 3,273 | $ | 2,894 | $ | 1,536 | $ | 14,893 | ||||||||||
Acquired businesses | 18 | - | - | 355 | 373 | |||||||||||||||
Currency | (243 | ) | (279 | ) | (265 | ) | (84 | ) | (871 | ) | ||||||||||
Operations | (127 | ) | 575 | 259 | 116 | 823 | ||||||||||||||
For the quarter ended December 31, 2008 | $ | 6,838 | $ | 3,569 | $ | 2,888 | $ | 1,923 | $ | 15,218 | ||||||||||
(*) The detail of excise taxes on products | ||||||||||||||||||||
sold is as follows: | ||||||||||||||||||||
2008 | $ | 4,711 | $ | 1,769 | $ | 1,420 | $ | 1,196 | $ | 9,096 | ||||||||||
2007 | $ | 4,928 | $ | 1,609 | $ | 1,489 | $ | 960 | $ | 8,986 | ||||||||||
2008 Currency (decreased) excise | ||||||||||||||||||||
taxes as follows: | $ | (160 | ) | $ | (170 | ) | $ | (202 | ) | $ | (51 | ) | $ | (583 | ) | |||||
(1) Results have been revised to reflect the movement of |
||||||||||||||||||||
certain subsidiaries to a December 31 closing date. |
||||||||||||||||||||
See Schedule 11 for more information. |
Schedule 3 | ||||||||||||||||||||
PHILIP MORRIS INTERNATIONAL INC. | ||||||||||||||||||||
and Subsidiaries | ||||||||||||||||||||
Selected Financial Data by Business Segment | ||||||||||||||||||||
For the Quarters Ended December 31, | ||||||||||||||||||||
(in millions) | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||
Operating Companies Income (1) | ||||||||||||||||||||
Latin | ||||||||||||||||||||
European | America & | |||||||||||||||||||
Union | EEMA | Asia | Canada | Total | ||||||||||||||||
2008 | $ | 959 | $ | 680 | $ | 426 | $ | 238 | $ | 2,303 | ||||||||||
2007 | 1,059 | 628 | 424 | 190 | 2,301 | |||||||||||||||
% Change | (9.4 | )% | 8.3 | % | 0.5 | % | 25.3 | % | 0.1 | % | ||||||||||
Reconciliation: | ||||||||||||||||||||
For the quarter ended December 31, 2007 | $ | 1,059 | $ | 628 | $ | 424 | $ | 190 | $ | 2,301 | ||||||||||
Asset impairment and exit costs - 2007 | 36 | - | 6 | - | 42 | |||||||||||||||
Asset impairment and exit costs - 2008 | - | - | - | - | - | |||||||||||||||
Acquired businesses | 10 | - | - | 58 | 68 | |||||||||||||||
Currency | (91 | ) | (104 | ) | (23 | ) | (19 | ) | (237 | ) | ||||||||||
Operations | (55 | ) | 156 | 19 | 9 | 129 | ||||||||||||||
For the quarter ended December 31, 2008 | $ | 959 | $ | 680 | $ | 426 | $ | 238 | $ | 2,303 | ||||||||||
(1) Results have been revised to reflect the movement | ||||||||||||||||||||
of certain subsidiaries to a December 31 closing | ||||||||||||||||||||
date. See Schedule 11 for more information. |
Schedule 4 | ||||||||||||
PHILIP MORRIS INTERNATIONAL INC. | ||||||||||||
and Subsidiaries | ||||||||||||
Condensed Statements of Earnings (1) | ||||||||||||
For the Years Ended December 31, | ||||||||||||
(in millions, except per share data) | ||||||||||||
(Unaudited) | ||||||||||||
2008 | 2007 | % Change | ||||||||||
Net revenues | $ | 63,640 | $ | 55,243 | 15.2 | % | ||||||
Cost of sales | 9,328 | 8,711 | 7.1 | % | ||||||||
Excise taxes on products (2) | 37,935 | 32,433 | 17.0 | % | ||||||||
Gross profit | 16,377 | 14,099 | 16.2 | % | ||||||||
Marketing, administration and research costs | 5,859 | 4,961 | ||||||||||
Asset impairment and exit costs | 84 | 195 | ||||||||||
Operating companies income | 10,434 | 8,943 | 16.7 | % | ||||||||
Amortization of intangibles | 44 | 28 | ||||||||||
Gain on sale of leasing business | - | (52 | ) | |||||||||
General corporate expenses | 142 | 60 | ||||||||||
Asset impairment and exit costs | - | 13 | ||||||||||
Operating income | 10,248 | 8,894 | 15.2 | % | ||||||||
Interest expense, net | 311 | 10 | ||||||||||
Earnings before income taxes and minority interest | 9,937 | 8,884 | 11.9 | % | ||||||||
Provision for income taxes | 2,787 | 2,570 | 8.4 | % | ||||||||
Earnings before minority interest | 7,150 | 6,314 | 13.2 | % | ||||||||
Minority interest in earnings, net of income taxes | 260 | 276 | ||||||||||
Net earnings | $ | 6,890 | $ | 6,038 | 14.1 | % | ||||||
Per share data: (3) | ||||||||||||
Basic earnings per share | $ | 3.33 | $ | 2.86 | 16.4 | % | ||||||
Diluted earnings per share | $ | 3.32 | $ | 2.86 | 16.1 | % | ||||||
Weighted average number of | ||||||||||||
shares outstanding | ||||||||||||
- Basic (4) | 2,068 | 2,109 | (1.9 | ) | % | |||||||
- Diluted (4) | 2,078 | 2,109 | (1.5 | ) | % | |||||||
(1) Results have been revised to reflect the movement of | ||||||||||||
certain subsidiaries to a December 31 closing date. | ||||||||||||
See Schedule 11 for more information. | ||||||||||||
(2) The segment detail of excise taxes on products sold | ||||||||||||
for the year ended December 31, 2008 and 2007 is | ||||||||||||
shown on Schedule 5. | ||||||||||||
(3) Basic and diluted earnings per share are computed for | ||||||||||||
each of the periods presented. Accordingly, the sum | ||||||||||||
of the quarterly earnings per share amounts may not | ||||||||||||
agree to the year-to-date amounts. | ||||||||||||
(4) For the year ended December 31, 2007, basic and diluted | ||||||||||||
earnings per share are calculated based on the number of | ||||||||||||
our shares distributed by Altria on the Distribution Date. |
Schedule 5 | ||||||||||||||||||||
PHILIP MORRIS INTERNATIONAL INC. | ||||||||||||||||||||
and Subsidiaries | ||||||||||||||||||||
Selected Financial Data by Business Segment | ||||||||||||||||||||
For the Years Ended December 31, | ||||||||||||||||||||
(in millions) | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||
Net Revenues (1) | ||||||||||||||||||||
Latin | ||||||||||||||||||||
European | America & | |||||||||||||||||||
Union | EEMA | Asia | Canada | Total | ||||||||||||||||
2008 | $ | 30,265 | $ | 14,817 | $ | 12,222 | $ | 6,336 | $ | 63,640 | ||||||||||
2007 | 26,829 | 12,166 | 11,097 | 5,151 | 55,243 | |||||||||||||||
% Change | 12.8 | % | 21.8 | % | 10.1 | % | 23.0 | % | 15.2 | % | ||||||||||
Reconciliation: |
||||||||||||||||||||
For the year ended December 31, 2007 | $ | 26,829 | $ | 12,166 | $ | 11,097 | $ | 5,151 | $ | 55,243 | ||||||||||
Acquired businesses | 36 | - | 88 | 355 | 479 | |||||||||||||||
Currency | 3,032 | 679 | 96 | 129 | 3,936 | |||||||||||||||
Operations | 368 | 1,972 | 941 | 701 | 3,982 | |||||||||||||||
For the year ended December 31, 2008 | $ | 30,265 | $ | 14,817 | $ | 12,222 | $ | 6,336 | $ | 63,640 | ||||||||||
(*) The detail of excise taxes on products | ||||||||||||||||||||
sold is as follows: | ||||||||||||||||||||
2008 | $ | 20,577 | $ | 7,313 | $ | 6,037 | $ | 4,008 | $ | 37,935 | ||||||||||
2007 | $ | 17,994 | $ | 5,820 | $ | 5,449 | $ | 3,170 | $ | 32,433 | ||||||||||
2008 Currency increased (decreased) excise | ||||||||||||||||||||
taxes as follows: | $ | 2,133 | $ | 383 | $ | (44 | ) | $ | 82 | $ | 2,554 | |||||||||
(1) Results have been revised to reflect the movement of certain | ||||||||||||||||||||
subsidiaries to a December 31 closing date. See Schedule 11 | ||||||||||||||||||||
for more information. |
Schedule 6 | ||||||||||||||||||||
PHILIP MORRIS INTERNATIONAL INC. | ||||||||||||||||||||
and Subsidiaries | ||||||||||||||||||||
Selected Financial Data by Business Segment | ||||||||||||||||||||
For the Years Ended December 31, | ||||||||||||||||||||
(in millions) | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||
Operating Companies Income (1) | ||||||||||||||||||||
Latin | ||||||||||||||||||||
European | America & | |||||||||||||||||||
Union | EEMA | Asia | Canada | Total | ||||||||||||||||
2008 | $ | 4,738 | $ | 3,119 | $ | 2,057 | $ | 520 | $ | 10,434 | ||||||||||
2007 | 4,195 | 2,431 | 1,803 | 514 | 8,943 | |||||||||||||||
% Change | 12.9 | % | 28.3 | % | 14.1 | % | 1.2 | % | 16.7 | % | ||||||||||
Reconciliation: |
||||||||||||||||||||
For the year ended December 31, 2007 | $ | 4,195 | $ | 2,431 | $ | 1,803 | $ | 514 | $ | 8,943 | ||||||||||
Asset impairment and exit costs - 2007 | 137 | 12 | 28 | 18 | 195 | |||||||||||||||
Asset impairment and exit costs - 2008 | (66 | ) | (1 | ) | (14 | ) | (3 | ) | (84 | ) | ||||||||||
Equity loss from RBH legal settlement - 2008 | - | - | - | (124 | ) | (124 | ) | |||||||||||||
Acquired businesses | 20 | - | 5 | 100 | 125 | |||||||||||||||
Currency | 432 | 21 | 32 | (4 | ) | 481 | ||||||||||||||
Operations | 20 | 656 | 203 | 19 | 898 | |||||||||||||||
For the year ended December 31, 2008 | $ | 4,738 | $ | 3,119 | $ | 2,057 | $ | 520 | $ | 10,434 | ||||||||||
(1) Results have been revised to reflect the movement of certain | ||||||||||||||||||||
subsidiaries to a December 31 closing date. See Schedule 11 | ||||||||||||||||||||
for more information. |
Schedule 7 | |||||||||||
PHILIP MORRIS INTERNATIONAL INC. | |||||||||||
and Subsidiaries | |||||||||||
Net Earnings and Diluted Earnings Per Share | |||||||||||
For the Quarters Ended December 31, | |||||||||||
($ in millions, except per share data) | |||||||||||
(Unaudited) | |||||||||||
Diluted | |||||||||||
Net Earnings | E.P.S. | ||||||||||
2008 Net Earnings | $ | 1,445 | $ | 0.71 | |||||||
2007 Net Earnings (1) | $ | 1,567 | $ | 0.74 | |||||||
% Change | (7.8 | ) | % | (4.1 | ) | % | |||||
Reconciliation: |
|||||||||||
2007 Net Earnings (1) | $ | 1,567 | $ | 0.74 | |||||||
Special Items: |
|||||||||||
2007 Asset impairment and exit costs | 41 | 0.02 | |||||||||
2007 Tax items | (41 | ) | (0.02 | ) | |||||||
2007 Gain on sale of business | (14 | ) | (0.01 | ) | |||||||
Subtotal 2007 items | (14 | ) | (0.01 | ) | |||||||
2008 Asset impairment and exit costs | - | - | |||||||||
2008 Tax items | 6 | - | |||||||||
Subtotal 2008 items | 6 | - | |||||||||
Currency | (224 | ) | (0.10 | ) | |||||||
Interest | (61 | ) | (0.03 | ) | |||||||
Change in tax rate | 7 | - | |||||||||
Lower shares outstanding | - | 0.03 | |||||||||
Operations | 164 | 0.08 | |||||||||
2008 Net Earnings | $ | 1,445 | $ | 0.71 | |||||||
(1) Results for the quarter ended December 31, 2007 have been | |||||||||||
revised to reflect the movement of certain subsidiaries | |||||||||||
to a December 31 closing date. See Schedule 11 for more | |||||||||||
information. |
Schedule 8 | |||||||||||
PHILIP MORRIS INTERNATIONAL INC. | |||||||||||
and Subsidiaries | |||||||||||
Net Earnings and Diluted Earnings Per Share | |||||||||||
For the Years Ended December 31, | |||||||||||
($ in millions, except per share data) | |||||||||||
(Unaudited) | |||||||||||
Diluted | |||||||||||
Net Earnings | E.P.S. | (*) | |||||||||
2008 Net Earnings | $ | 6,890 | $ | 3.32 | |||||||
2007 Net Earnings (1) | $ | 6,038 | $ | 2.86 | |||||||
% Change | 14.1 | % | 16.1 | % | |||||||
Reconciliation: |
|||||||||||
2007 Net Earnings (1) | $ | 6,038 | $ | 2.86 | |||||||
Special Items: |
|||||||||||
2007 Asset impairment and exit costs | 152 | 0.07 | |||||||||
2007 Tax items | (68 | ) | (0.03 | ) | |||||||
2007 Gain on sale of business | (14 | ) | (0.01 | ) | |||||||
Subtotal 2007 items | 70 | 0.03 | |||||||||
2008 Asset impairment and exit costs | (54 | ) | (0.02 | ) | |||||||
2008 Equity loss from RBH legal settlement | (124 | ) | (0.06 | ) | |||||||
2008 Tax items | 175 | 0.08 | |||||||||
Subtotal 2008 items | (3 | ) | - | ||||||||
Currency | 306 | 0.15 | |||||||||
Interest | (204 | ) | (0.09 | ) | |||||||
Lower shares outstanding | - | 0.05 | |||||||||
Change in tax rate | (11 | ) | (0.01 | ) | |||||||
Operations | 694 | 0.33 | |||||||||
2008 Net Earnings | $ | 6,890 | $ | 3.32 | |||||||
(*) Basic and diluted earnings per share are computed for each of | |||||||||||
the periods presented. Accordingly, the sum of the quarterly | |||||||||||
earnings per share amounts may not agree to the year-to-date | |||||||||||
amounts. | |||||||||||
(1) Results for the year ended December 31, 2007 have been revised | |||||||||||
to reflect the movement of certain subsidiaries to a | |||||||||||
December 31 closing date. See Schedule 11 for more information. |
Schedule 9 | ||||||||||||||||
PHILIP MORRIS INTERNATIONAL INC. |
||||||||||||||||
and Subsidiaries | ||||||||||||||||
Revised Volume, Net Revenues, Excise Taxes on Products and Operating Companies Income (1) | ||||||||||||||||
For the Quarters and Year Ended December 31, 2007 | ||||||||||||||||
(in millions) | ||||||||||||||||
(Unaudited) | ||||||||||||||||
Quarter | Quarter | Quarter | Quarter | Year | ||||||||||||
Ended | Ended | Ended | Ended | Ended | ||||||||||||
March 31, | June 30, | September 30, | December 31, | December 31, | ||||||||||||
2007 | 2007 | 2007 | 2007 | 2007 | ||||||||||||
Cigarette Volume: | ||||||||||||||||
European Union | 61,377 | 67,776 | 65,450 | 62,938 | 257,541 | |||||||||||
EEMA | 64,756 | 75,904 | 77,498 | 72,152 | 290,310 | |||||||||||
Asia | 50,182 | 55,804 | 52,961 | 52,533 | 211,480 | |||||||||||
Latin America & Canada | 21,171 | 21,517 | 21,297 | 25,322 | 89,307 | |||||||||||
197,486 | 221,001 | 217,206 | 212,945 | 848,638 | ||||||||||||
Net Revenues: | ||||||||||||||||
European Union | $ | 5,940 | $ | 6,867 | $ | 6,832 | $ | 7,190 | $ | 26,829 | ||||||
EEMA | 2,478 | 3,103 | 3,312 | 3,273 | 12,166 | |||||||||||
Asia | 2,602 | 2,787 | 2,814 | 2,894 | 11,097 | |||||||||||
Latin America & Canada | 1,150 | 1,191 | 1,274 | 1,536 | 5,151 | |||||||||||
$ | 12,170 | $ | 13,948 | $ | 14,232 | $ | 14,893 | $ | 55,243 | |||||||
Excise Taxes on Products: | ||||||||||||||||
European Union | $ | 3,944 | $ | 4,568 | $ | 4,554 | $ | 4,928 | $ | 17,994 | ||||||
EEMA | 1,133 | 1,472 | 1,606 | 1,609 | 5,820 | |||||||||||
Asia | 1,242 | 1,346 | 1,372 | 1,489 | 5,449 | |||||||||||
Latin America & Canada | 699 | 727 | 784 | 960 | 3,170 | |||||||||||
$ | 7,018 | $ | 8,113 | $ | 8,316 | $ | 8,986 | $ | 32,433 | |||||||
Operating Companies Income: | ||||||||||||||||
European Union | $ | 910 | $ | 1,075 | $ | 1,151 | $ | 1,059 | $ | 4,195 | ||||||
EEMA | 459 | 634 | 710 | 628 | 2,431 | |||||||||||
Asia | 436 | 429 | 514 | 424 | 1,803 | |||||||||||
Latin America & Canada | 79 | 102 | 143 | 190 | 514 | |||||||||||
$ | 1,884 | $ | 2,240 | $ | 2,518 | $ | 2,301 | $ | 8,943 | |||||||
(1) Prior to 2008, certain of our subsidiaries reported | ||||||||||||||||
their results up to ten days before the end of December | ||||||||||||||||
rather than on December 31. During 2008, these subsidiaries | ||||||||||||||||
moved to a December 31 closing date. As a result, the first | ||||||||||||||||
and fourth quarter results of previous periods have been | ||||||||||||||||
revised to reflect this change. The effect of this change | ||||||||||||||||
for the year ended December 31, 2007 was not material to | ||||||||||||||||
our consolidated financial position, results of operations | ||||||||||||||||
or cash flows. |
Schedule 10 | ||||||||||||||||
PHILIP MORRIS INTERNATIONAL INC. | ||||||||||||||||
and Subsidiaries | ||||||||||||||||
Revised Volume, Net Revenues, Excise Taxes on Products and Operating Companies Income (1) | ||||||||||||||||
For the Quarters and Year Ended December 31, 2008 | ||||||||||||||||
(in millions) | ||||||||||||||||
(Unaudited) | ||||||||||||||||
Quarter | Quarter | Quarter | Quarter | Year | ||||||||||||
Ended | Ended | Ended | Ended | Ended | ||||||||||||
March 31, | June 30, | September 30, | December 31, | December 31, | ||||||||||||
2008 | 2008 | 2008 | 2008 | 2008 | ||||||||||||
Cigarette Volume: | ||||||||||||||||
European Union | 57,051 | 64,817 | 64,063 | 57,520 | 243,451 | |||||||||||
EEMA | 67,874 | 78,300 | 81,405 | 75,626 | 303,205 | |||||||||||
Asia | 55,562 | 56,843 | 55,946 | 55,373 | 223,724 | |||||||||||
Latin America & Canada | 22,980 | 23,209 | 24,500 | 28,688 | 99,377 | |||||||||||
203,467 | 223,169 | 225,914 | 217,207 | 869,757 | ||||||||||||
Net Revenues: | ||||||||||||||||
European Union | $ | 6,697 | $ | 8,279 | $ | 8,451 | $ | 6,838 | $ | 30,265 | ||||||
EEMA | 3,283 | 3,802 | 4,163 | 3,569 | 14,817 | |||||||||||
Asia | 2,976 | 3,170 | 3,188 | 2,888 | 12,222 | |||||||||||
Latin America & Canada | 1,398 | 1,452 | 1,563 | 1,923 | 6,336 | |||||||||||
$ | 14,354 | $ | 16,703 | $ | 17,365 | $ | 15,218 | $ | 63,640 | |||||||
Excise Taxes on Products: | ||||||||||||||||
European Union | $ | 4,451 | $ | 5,635 | $ | 5,780 | $ | 4,711 | $ | 20,577 | ||||||
EEMA | 1,621 | 1,869 | 2,054 | 1,769 | 7,313 | |||||||||||
Asia | 1,473 | 1,566 | 1,578 | 1,420 | 6,037 | |||||||||||
Latin America & Canada | 888 | 924 | 1,000 | 1,196 | 4,008 | |||||||||||
$ | 8,433 | $ | 9,994 | $ | 10,412 | $ | 9,096 | $ | 37,935 | |||||||
Operating Companies Income: | ||||||||||||||||
European Union | $ | 1,167 | $ | 1,287 | $ | 1,325 | $ | 959 | $ | 4,738 | ||||||
EEMA | 680 | 813 | 946 | 680 | 3,119 | |||||||||||
Asia | 550 | 523 | 558 | 426 | 2,057 | |||||||||||
Latin America & Canada | 149 | 23 | 110 | 238 | 520 | |||||||||||
$ | 2,546 | $ | 2,646 | $ | 2,939 | $ | 2,303 | $ | 10,434 | |||||||
(1) Prior to 2008, certain of our subsidiaries reported | ||||||||||||||||
their results up to ten days before the end of December | ||||||||||||||||
rather than on December 31. During 2008, these subsidiaries | ||||||||||||||||
moved to a December 31 closing date. As a result, the first | ||||||||||||||||
and fourth quarter results of previous periods have been | ||||||||||||||||
revised to reflect this change. The effect of this change | ||||||||||||||||
for the year ended December 31, 2008 was not material to our | ||||||||||||||||
consolidated financial position, results of operations | ||||||||||||||||
or cash flows. |
Schedule 11 | ||||||||||||||||||
PHILIP MORRIS INTERNATIONAL INC. | ||||||||||||||||||
and Subsidiaries | ||||||||||||||||||
Revised Condensed Statements of Earnings (1) | ||||||||||||||||||
For the Quarters and Year Ended December 31, 2007 | ||||||||||||||||||
(in millions, except per share data) | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||
Quarter | Quarter | Quarter | Quarter | Year | ||||||||||||||
Ended | Ended | Ended | Ended | Ended | ||||||||||||||
March 31, | June 30, | September 30, | December 31, | December 31, | ||||||||||||||
2007 | 2007 | 2007 | 2007 | 2007 | ||||||||||||||
Net revenues | $ | 12,170 | $ | 13,948 | $ | 14,232 | $ | 14,893 | $ | 55,243 | ||||||||
Cost of sales | 1,994 | 2,244 | 2,229 | 2,244 | 8,711 | |||||||||||||
Excise taxes on products | 7,018 | 8,113 | 8,316 | 8,986 | 32,433 | |||||||||||||
Gross profit | 3,158 | 3,591 | 3,687 | 3,663 | 14,099 | |||||||||||||
Marketing, administration and research costs | 1,212 | 1,275 | 1,154 | 1,320 | 4,961 | |||||||||||||
Asset impairment and exit costs | 62 | 76 | 15 | 42 | 195 | |||||||||||||
Operating companies income | 1,884 | 2,240 | 2,518 | 2,301 | 8,943 | |||||||||||||
Amortization of intangibles | 6 | 6 | 6 | 10 | 28 | |||||||||||||
Gain on sale of leasing business | - | - | - | (52 | ) | (52 | ) | |||||||||||
General corporate expenses | 17 | 17 | 17 | 9 | 60 | |||||||||||||
Asset impairment and exit costs | - | - | - | 13 | 13 | |||||||||||||
Operating income | 1,861 | 2,217 | 2,495 | 2,321 | 8,894 | |||||||||||||
Interest expense, net | 10 | 3 | (16 | ) | 13 | 10 | ||||||||||||
Earnings before income taxes and minority interest | 1,851 | 2,214 | 2,511 | 2,308 | 8,884 | |||||||||||||
Provision for income taxes | 538 | 668 | 710 | 654 | 2,570 | |||||||||||||
Earnings before minority interest | 1,313 | 1,546 | 1,801 | 1,654 | 6,314 | |||||||||||||
Minority interest in earnings, net of income taxes | 50 | 63 | 76 | 87 | 276 | |||||||||||||
Net earnings | $ | 1,263 | $ | 1,483 | $ | 1,725 | $ | 1,567 | $ | 6,038 | ||||||||
Per share data: | ||||||||||||||||||
Basic earnings per share (2) | $ | 0.60 | $ | 0.70 | $ | 0.82 | $ | 0.74 | $ | 2.86 | ||||||||
Diluted earnings per share (2) | $ | 0.60 | $ | 0.70 | $ | 0.82 | $ | 0.74 | $ | 2.86 | ||||||||
Weighted average number of | ||||||||||||||||||
shares outstanding | ||||||||||||||||||
- Basic (3) | 2,109 | 2,109 | 2,109 | 2,109 | 2,109 | |||||||||||||
- Diluted (3) | 2,109 | 2,109 | 2,109 | 2,109 | 2,109 | |||||||||||||
(1) Prior to 2008, certain of our subsidiaries reported their results up to ten | ||||||||||||||||||
days before the end of December rather than on December 31. During 2008, these | ||||||||||||||||||
subsidiaries moved to a December 31 closing date. As a result, the first and | ||||||||||||||||||
fourth quarter results of previous periods have been revised to reflect this | ||||||||||||||||||
change. The effect of this change for the year ended December 31, 2007 was not | ||||||||||||||||||
material to our consolidated financial position, results of operations or cash flows. | ||||||||||||||||||
(2) Basic and diluted earnings per share are computed for each of the periods | ||||||||||||||||||
presented. Accordingly, the sum of the quarterly earnings per share amounts | ||||||||||||||||||
may not agree to the year-to-date amounts. | ||||||||||||||||||
(3) Basic and diluted earnings per share are calculated based on the number of | ||||||||||||||||||
our shares distributed by Altria on the Distribution Date. |
Schedule 12 | ||||||||||||||
PHILIP MORRIS INTERNATIONAL INC. | ||||||||||||||
and Subsidiaries | ||||||||||||||
Revised Condensed Statements of Earnings (1) | ||||||||||||||
For the Quarters and Year Ended December 31, 2008 | ||||||||||||||
(in millions, except per share data) | ||||||||||||||
(Unaudited) | ||||||||||||||
Quarter | Quarter | Quarter | Quarter | Year | ||||||||||
Ended | Ended | Ended | Ended | Ended | ||||||||||
March 31, | June 30, | September 30, | December 31, | December 31, | ||||||||||
2008 | 2008 | 2008 | 2008 | 2008 | ||||||||||
Net revenues | $ | 14,354 | $ | 16,703 | $ | 17,365 | $ | 15,218 | $ | 63,640 | ||||
Cost of sales | 2,181 | 2,462 | 2,481 | 2,204 | 9,328 | |||||||||
Excise taxes on products | 8,433 | 9,994 | 10,412 | 9,096 | 37,935 | |||||||||
Gross profit | 3,740 | 4,247 | 4,472 | 3,918 | 16,377 | |||||||||
Marketing, administration and research costs | 1,171 | 1,553 | 1,520 | 1,615 | 5,859 | |||||||||
Asset impairment and exit costs | 23 | 48 | 13 | - | 84 | |||||||||
Operating companies income | 2,546 | 2,646 | 2,939 | 2,303 | 10,434 | |||||||||
Amortization of intangibles | 9 | 7 | 13 | 15 | 44 | |||||||||
Gain on sale of leasing business | - | - | - | - | - | |||||||||
General corporate expenses | 13 | 31 | 36 | 62 | 142 | |||||||||
Asset impairment and exit costs | - | - | - | - | - | |||||||||
Operating income | 2,524 | 2,608 | 2,890 | 2,226 | 10,248 | |||||||||
Interest expense, net | 75 | 61 | 69 | 106 | 311 | |||||||||
Earnings before income taxes and minority interest | 2,449 | 2,547 | 2,821 | 2,120 | 9,937 | |||||||||
Provision for income taxes | 725 | 790 | 667 | 605 | 2,787 | |||||||||
Earnings before minority interest | 1,724 | 1,757 | 2,154 | 1,515 | 7,150 | |||||||||
Minority interest in earnings, net of income taxes | 51 | 65 | 74 | 70 | 260 | |||||||||
Net earnings | $ | 1,673 | $ | 1,692 | $ | 2,080 | $ | 1,445 | $ | 6,890 | ||||
Per share data: | ||||||||||||||
Basic earnings per share (2) | $ | 0.79 | $ | 0.81 | $ | 1.01 | $ | 0.72 | $ | 3.33 | ||||
Diluted earnings per share (2) | $ | 0.79 | $ | 0.80 | $ | 1.01 | $ | 0.71 | $ | 3.32 | ||||
Weighted average number of | ||||||||||||||
shares outstanding | ||||||||||||||
- Basic | 2,108 | 2,095 | 2,051 | 2,020 | 2,068 | |||||||||
- Diluted | 2,108 | 2,108 | 2,064 | 2,031 | 2,078 | |||||||||
(1) Prior to 2008, certain of our subsidiaries reported their results up to ten | ||||||||||||||
days before the end of December rather than on December 31. During 2008, these | ||||||||||||||
subsidiaries moved to a December 31 closing date. As a result, the first and | ||||||||||||||
fourth quarter results of previous periods have been revised to reflect this | ||||||||||||||
change. The effect of this change for the year ended December 31, 2008 was not | ||||||||||||||
material to our consolidated financial position, results of operations or cash flows. | ||||||||||||||
(2) Basic and diluted earnings per share are computed for each of the periods | ||||||||||||||
presented. Accordingly, the sum of the quarterly earnings per share amounts may | ||||||||||||||
not agree to the year-to-date amounts. |
Schedule 13 | |||||||||||
PHILIP MORRIS INTERNATIONAL INC. | |||||||||||
and Subsidiaries | |||||||||||
Reconciliation of Reported to Pro Forma Adjusted Condensed Consolidated Statement of Earnings | |||||||||||
For the Quarter Ended December 31, 2007 | |||||||||||
(in millions, except per share data) | |||||||||||
(Unaudited) | |||||||||||
Pro Forma | |||||||||||
Reported (g) | Adjustments | Adjusted | |||||||||
Net revenues | $ | 14,893 | $ | - | $ | 14,893 | |||||
Cost of sales | 2,244 | - | 2,244 | ||||||||
Excise taxes on products | 8,986 | - | 8,986 | ||||||||
Gross profit | 3,663 | - | 3,663 | ||||||||
Marketing, administration and research costs | 1,320 | 6 | (c) | 1,326 | |||||||
Asset impairment and exit costs | 42 | (42 | ) | (a) | - | ||||||
Operating companies income | 2,301 | 36 | 2,337 | ||||||||
Amortization of intangibles | 10 | - | 10 | ||||||||
Gain on sale of leasing business | (52 | ) | 52 | (b) | - | ||||||
General corporate expenses | 9 | 17 | (c) | 26 | |||||||
Asset impairment and exit costs | 13 | (13 | ) | (a) | - | ||||||
Operating income | 2,321 | (20 | ) | 2,301 | |||||||
Interest expense, net | 13 | 40 | (d) | 53 | |||||||
Earnings before income taxes and minority interest | 2,308 | (60 | ) | 2,248 | |||||||
Provision for income taxes | 654 | (3 | ) | (a,b,c,d,e) | 651 | ||||||
Earnings before minority interest | 1,654 | (57 | ) | 1,597 | |||||||
Minority interest in earnings, net of income taxes | 87 | - | 87 | ||||||||
Net earnings | $ | 1,567 | (57 | ) | $ | 1,510 | |||||
Per share data: | |||||||||||
Basic earnings per share | $ | 0.74 | $ | 0.72 | |||||||
Diluted earnings per share | $ | 0.74 | $ | 0.72 | |||||||
Weighted average number of | |||||||||||
shares outstanding | |||||||||||
- Basic (f) | 2,109 | 2,109 | |||||||||
- Diluted (f) | 2,109 | 2,109 |
(a) This adjustment reflects the reversal of $55 million of pre-tax asset impairment and exit | ||
costs ($41 million after-tax) relating to the streamlining of various administrative functions. | ||
(b) During 2007, we sold our leasing business, which was managed by Philip Morris Capital | ||
Corporation, or PMCC, Altria's financial services subsidiary, for a pre-tax gain of $52 million | ||
($14 million after-tax). This adjustment reflects the reversal of this transaction. | ||
(c) A subsidiary of Altria had provided us with certain services at cost plus a management fee. | ||
This adjustment reflects incremental costs of $23 million, partially offset by the related tax | ||
benefit of $6 million. These incremental costs reflect the expansion of services that were | ||
previously provided by Altria to reflect our status as a stand-alone public company. | ||
(d) As part of the Spin-off, we paid to Altria $4.0 billion in special dividends, of which $3.1 | ||
billion were paid in 2007 and the remaining $900 million were paid in the first quarter of 2008. | ||
The pro forma adjusted statement of earnings has been adjusted to reflect the incremental | ||
interest expense we would have incurred if borrowings to finance the special dividends had been | ||
made on January 1, 2007. The incremental interest adjustment of $40 million, partially offset by | ||
the related tax benefit of $14 million, was computed by applying a rate of 5.24% (the average | ||
rate of our December 2007 borrowings that were incurred to pay Altria the dividend) to the total | ||
special dividends that were paid to Altria, less $11 million of interest related to these | ||
borrowings that is already included in our historical interest expense. An increase or (decrease) | ||
of one-eighth of 1% (12.5 basis points) in the interest rate associated with these variable rate | ||
borrowings would have increased or (decreased) our pro forma adjusted interest expense by $1.1 | ||
million. | ||
(e) The reported tax provision in 2007 included the reversal of tax accruals of $41 million no | ||
longer required. This adjustment reflects the reversal of this transaction. | ||
(f) Basic and diluted earnings per share are calculated based on the number of our shares | ||
distributed by Altria on the Distribution Date. | ||
(g) Results for the quarter ended December 31, 2007 have been revised to reflect the movement of | ||
certain subsidiaries to a December 31 closing date. See Schedule 11 for more information. |
Schedule 14 | ||||||||||
PHILIP MORRIS INTERNATIONAL INC. | ||||||||||
and Subsidiaries | ||||||||||
Reconciliation of Reported to Pro Forma Adjusted Condensed Consolidated Statement of Earnings | ||||||||||
For the Year Ended December 31, 2007 | ||||||||||
(in millions, except per share data) | ||||||||||
(Unaudited) | ||||||||||
Pro Forma | ||||||||||
Reported (g) | Adjustments | Adjusted | ||||||||
Net revenues | $ | 55,243 | $ | - | $ | 55,243 | ||||
Cost of sales | 8,711 | - | 8,711 | |||||||
Excise taxes on products | 32,433 | - | 32,433 | |||||||
Gross profit | 14,099 | - | 14,099 | |||||||
Marketing, administration and research costs | 4,961 | 26 | (c) | 4,987 | ||||||
Asset impairment and exit costs | 195 | (195 | ) | (a) | - | |||||
Operating companies income | 8,943 | 169 | 9,112 | |||||||
Amortization of intangibles | 28 | - | 28 | |||||||
Gain on sale of leasing business | (52 | ) | 52 | (b) | - | |||||
General corporate expenses | 60 | 66 | (c) | 126 | ||||||
Asset impairment and exit costs | 13 | (13 | ) | (a) | - | |||||
Operating income | 8,894 | 64 | 8,958 | |||||||
Interest expense, net | 10 | 199 | (d) | 209 | ||||||
Earnings before income taxes and minority interest | 8,884 | (135 | ) | 8,749 | ||||||
Provision for income taxes | 2,570 | - | (a,b,c,d,e) | 2,570 | ||||||
Earnings before minority interest | 6,314 | (135 | ) | 6,179 | ||||||
Minority interest in earnings, net of income taxes | 276 | - | 276 | |||||||
Net earnings | $ | 6,038 | (135 | ) | $ | 5,903 | ||||
Per share data: | ||||||||||
Basic earnings per share | $ | 2.86 | $ | 2.80 | ||||||
Diluted earnings per share | $ | 2.86 | $ | 2.80 | ||||||
Weighted average number of | ||||||||||
shares outstanding | ||||||||||
- Basic (f) | 2,109 | 2,109 | ||||||||
- Diluted (f) | 2,109 | 2,109 |
(a) These adjustments reflect the reversal of $208 million of pre-tax asset impairment and exit | |
costs ($152 million after-tax) relating to the streamlining of various administrative functions. | |
(b) During 2007, we sold our leasing business, which was managed by Philip Morris Capital | |
Corporation, or PMCC, Altria's financial services subsidiary, for a pre-tax gain of $52 million | |
($14 million after-tax). This adjustment reflects the reversal of this transaction. | |
(c) A subsidiary of Altria had provided us with certain services at cost plus a management fee. | |
This adjustment reflects incremental costs of $92 million, partially offset by the related tax | |
benefit of $27 million. These incremental costs reflect the expansion of services that were | |
previously provided by Altria to reflect our status as a stand-alone public company. | |
(d) As part of the Spin-off, we paid to Altria $4.0 billion in special dividends, of which $3.1 | |
billion were paid in 2007 and the remaining $900 million were paid in the first quarter of 2008. | |
The pro forma adjusted statement of earnings has been adjusted to reflect the incremental interest | |
expense we would have incurred if borrowings to finance the special dividends had been made on | |
January 1, 2007. The incremental interest adjustment of $199 million, partially offset by the | |
related tax benefit of $59 million, was computed by applying a rate of 5.24% (the average rate | |
of our December 2007 borrowings that were incurred to pay Altria the dividend) to the total | |
special dividends that were paid to Altria, less $11 million of interest related to these | |
borrowings that is already included in our historical interest expense. An increase or (decrease) | |
of one-eighth of 1% (12.5 basis points) in the interest rate associated with these variable rate | |
borrowings would have increased or (decreased) our pro forma adjusted interest expense by $5 | |
million. | |
(e) The 2007 reported effective tax rate included a tax benefit of $27 million related to the | |
reduction of deferred tax liabilities resulting from future tax rates enacted in Germany. The | |
reported tax provision in 2007 also included the reversal of tax accruals of $41 million no longer | |
required. This adjustment reflects the reversal of these transactions. | |
(f) Basic and diluted earnings per share are calculated based on the number of our shares | |
distributed by Altria on the Distribution Date. | |
(g) Results for the year ended December 31, 2007 have been revised to reflect the movement of | |
certain subsidiaries to a December 31 closing date. See Schedule 11 for more information. |
Schedule 15 | |||||
PHILIP MORRIS INTERNATIONAL INC. | |||||
and Subsidiaries | |||||
Condensed Balance Sheets | |||||
(in millions, except ratios) | |||||
(Unaudited) | |||||
December 31, | December 31, | ||||
2008 | 2007 (*) | ||||
Assets |
|||||
Cash and cash equivalents | $ | 1,531 | $ | 1,501 | |
All other current assets | 13,408 | 13,285 | |||
Property, plant and equipment, net | 6,348 | 6,435 | |||
Goodwill | 8,015 | 7,925 | |||
Other intangible assets, net | 3,084 | 1,906 | |||
Other assets | 586 | 725 | |||
Total assets | $ | 32,972 | $ | 31,777 | |
|
|||||
Liabilities and Stockholders' Equity |
|||||
Short-term borrowings | $ | 375 | $ | 400 | |
Current portion of long-term debt | 209 | 91 | |||
All other current liabilities | 9,560 | 7,600 | |||
Long-term debt | 11,377 | 5,578 | |||
Deferred income taxes | 1,401 | 1,240 | |||
Other long-term liabilities | 2,550 | 1,273 | |||
Total liabilities | 25,472 | 16,182 | |||
Total stockholders' equity | 7,500 | 15,595 | |||
Total liabilities and stockholders' equity | $ | 32,972 | $ | 31,777 | |
Total debt | $ | 11,961 | $ | 6,069 | |
Total debt/equity ratio | 1.59 | 0.39 | |||
(*) Prior to 2008, certain of our subsidiaries reported their results | |||||
up to ten days before the end of December, rather than on December 31. | |||||
During 2008, these subsidiaries moved to a December 31, 2008 closing | |||||
date. As a result, certain prior years' amounts have been revised to | |||||
reflect this change. The effect of this change was not material to our | |||||
consolidated financial position in any of the periods presented above. |
Source:
Philip Morris International Inc.
Investor Relations
New York:
+1 (917) 663 2233
Lausanne: +41 (058) 242 4666