Revises, for a Tax Charge of
2019 THIRD-QUARTER & YEAR-TO-DATE HIGHLIGHTS
2019 Third-Quarter
2019 Nine Months Year-to-Date
"Our third quarter results continued to reflect strong underlying business performance and include the better-than-anticipated timing of pricing and costs compared to our previously communicated assumptions for the quarter," said André Calantzopoulos, Chief Executive Officer.
"The exciting global growth of our heated tobacco products drove our resilient total shipment performance, despite certain timing issues related to our combustible portfolio. The quality of our execution across the business drove growth against each of the key metrics of net revenues, operating income, margin, as well as earnings per share -- both in the quarter and year-to-date -- on a currency-neutral, adjusted like-for-like basis."
"Importantly, IQOS was introduced in the U.S. this quarter, where it is currently the only
"While we expect our net revenue and adjusted operating income growth in the fourth quarter to be in line with our year-to-date results, our currency-neutral adjusted EPS growth is anticipated to be lower than our year-to-date performance, primarily due to an unfavorable income tax rate comparison and a high relative adjusted operating income growth contribution from markets with sizable non-controlling interests. Nevertheless, we are fully on track to deliver our target of full-year currency-neutral, like-for-like adjusted diluted EPS growth of at least 9%."
2019 FULL-YEAR FORECAST
|
Full-Year |
||||||||
2019 EPS Forecast |
2019 |
|
2018 |
Adjusted |
|||||
|
|
|
|
|
|
|
|
||
Reported Diluted EPS |
≥ |
$4.73 |
(a) |
$5.08 |
|
|
|
||
2018 Tax items |
|
— |
|
0.02 |
|
|
|
||
2019 Tax items |
|
(0.04) |
|
— |
|
|
|
||
2019 Asset impairment and exit costs |
|
0.04 |
|
— |
|
|
|
||
2019 Canadian tobacco litigation-related expense |
|
0.09 |
|
— |
|
|
|
||
2019 Loss on deconsolidation of RBH |
|
0.12 |
|
— |
|
|
|
||
2019 Russia excise and VAT audit charge |
|
0.20 |
|
— |
|
|
|
||
Adjusted Diluted EPS |
|
$5.14 |
|
$5.10 |
|
|
|
||
Net earnings attributable to RBH |
|
|
|
(0.26) |
(b) |
|
|
||
Adjusted Diluted EPS |
|
$5.14 |
|
$4.84 |
(c) |
|
|
||
Currency |
|
(0.14) |
|
|
|
|
|
||
Adjusted Diluted EPS, excluding currency |
≥ |
$5.28 |
|
$4.84 |
(c) |
≥ |
9% |
(a) Reflects the exclusion of previously anticipated net EPS of approximately $0.28 attributable to RBH from March 22, 2019 through December 31, 2019. The impact relating to the eight-day stub period was not material. |
PMI revises its full-year 2019 reported diluted EPS forecast to be at least
This revised full-year guidance reflects:
Russia Excise & VAT Audit Charge
The Moscow Tax Inspectorate for Major Taxpayers (MTI) conducted an audit of AO Philip Morris Izhora (PM Izhora), our Russian affiliate, for the 2015-2017 financial years. On
2019 Full-Year Forecast Overview & Assumptions
This forecast assumes:
This forecast excludes the impact of any future acquisitions, unanticipated asset impairment and exit cost charges, future changes in currency exchange rates, further developments related to the Tax Cuts and Jobs Act, further developments pertaining to the judgment in the two Québec Class Action lawsuits and the Companies’ Creditors Arrangement Act (CCAA) protection granted to RBH and any unusual events.
This forecast also excludes the contemplated proposal, previously communicated by PMI's local affiliate, to end cigarette production in
Factors described in the Forward-Looking and Cautionary Statements section of this release represent continuing risks to these projections.
Conference Call
A conference call, hosted by
CONSOLIDATED SHIPMENT VOLUME & MARKET SHARE
PMI Shipment Volume by Region |
Third-Quarter |
Nine Months Year-to-Date |
||||
(million units) |
2019 |
2018 |
Change |
2019 |
2018 |
Change |
Cigarettes |
|
|
|
|
|
|
European Union |
47,238 |
48,223 |
(2.0)% |
133,093 |
135,878 |
(2.0)% |
Eastern Europe |
27,379 |
29,801 |
(8.1)% |
74,779 |
80,294 |
(6.9)% |
Middle East & Africa |
36,994 |
37,406 |
(1.1)% |
101,957 |
100,831 |
1.1% |
South & Southeast Asia |
42,362 |
45,840 |
(7.6)% |
130,230 |
130,846 |
(0.5)% |
East Asia & Australia |
12,692 |
14,186 |
(10.5)% |
38,650 |
43,391 |
(10.9)% |
Latin America & Canada |
16,854 |
19,612 |
(14.1)% |
52,906 |
58,829 |
(10.1)% |
Total PMI |
183,519 |
195,068 |
(5.9)% |
531,615 |
550,069 |
(3.4)% |
|
|
|
|
|
|
|
Heated Tobacco Units |
|
|
|
|
|
|
European Union |
3,474 |
1,730 |
+100% |
8,810 |
3,853 |
+100% |
Eastern Europe |
3,858 |
1,152 |
+100% |
8,213 |
2,667 |
+100% |
Middle East & Africa |
588 |
1,152 |
(49.0)% |
2,061 |
2,832 |
(27.2)% |
South & Southeast Asia |
— |
— |
—% |
— |
— |
—% |
East Asia & Australia |
7,976 |
4,575 |
74.3% |
23,253 |
19,755 |
17.7% |
Latin America & Canada (1) |
89 |
43 |
+100% |
202 |
98 |
+100% |
Total PMI |
15,985 |
8,652 |
84.8% |
42,539 |
29,205 |
45.7% |
|
|
|
|
|
|
|
Cigarettes and Heated Tobacco Units |
|
|
|
|
|
|
European Union |
50,712 |
49,953 |
1.5% |
141,903 |
139,731 |
1.6% |
Eastern Europe |
31,237 |
30,953 |
0.9% |
82,992 |
82,961 |
—% |
Middle East & Africa |
37,582 |
38,558 |
(2.5)% |
104,018 |
103,663 |
0.3% |
South & Southeast Asia |
42,362 |
45,840 |
(7.6)% |
130,230 |
130,846 |
(0.5)% |
East Asia & Australia |
20,668 |
18,761 |
10.2% |
61,903 |
63,146 |
(2.0)% |
Latin America & Canada |
16,943 |
19,655 |
(13.8)% |
53,108 |
58,927 |
(9.9)% |
Total PMI |
199,504 |
203,720 |
(2.1)% |
574,154 |
579,274 |
(0.9)% |
(1) Includes shipments to Altria Group, Inc., commencing in the third quarter of 2019, for sale in the United States under license. |
Third-Quarter
PMI's total shipment volume decreased by 2.1%, or by 1.4% on a like-for-like basis, principally due to:
partly offset by
Impact of Inventory Movements
On a like-for-like basis, excluding the net favorable impact of estimated distributor inventory movements of approximately 4.8 billion units, PMI’s total in-market sales declined by 3.6% due to a 5.7% decline of cigarette in-market sales, partially offset by a 28.3% increase in heated tobacco unit in-market sales.
The net favorable impact of estimated distributor inventory movements of approximately 4.8 billion units was driven by 3.8 billion heated tobacco units (mainly reflecting a favorable comparison with the third quarter of 2018 in which IQOS consumable inventories in
Nine Months Year-to-Date
PMI's total shipment volume decreased by 0.9%, or by 0.4% on a like-for-like basis, due to:
partly offset by
PMI's total shipment volume in
Impact of Inventory Movements
On a like-for-like basis, excluding the net favorable impact of estimated distributor inventory movements of approximately 3.6 billion units, PMI’s total in-market sales declined by 1.0% due to a 2.9% decline of cigarette in-market sales, partly offset by a 31.8% increase in heated tobacco unit in-market sales.
The net favorable impact of estimated distributor inventory movements of approximately 3.6 billion units reflected 2.9 billion heated tobacco units, driven primarily by
PMI Shipment Volume by Brand
PMI Shipment Volume by Brand |
Third-Quarter |
Nine Months Year-to-Date |
||||
(million units) |
2019 |
2018 |
Change |
2019 |
2018 |
Change |
Cigarettes |
|
|
|
|
|
|
Marlboro |
68,859 |
69,121 |
(0.4)% |
196,883 |
195,987 |
0.5% |
L&M |
24,428 |
24,329 |
0.4% |
69,765 |
66,751 |
4.5% |
Chesterfield |
15,001 |
15,821 |
(5.2)% |
43,502 |
44,622 |
(2.5)% |
Philip Morris |
13,275 |
13,505 |
(1.7)% |
36,949 |
36,687 |
0.7% |
Parliament |
10,407 |
11,588 |
(10.2)% |
29,085 |
31,041 |
(6.3)% |
Sampoerna A |
8,756 |
10,333 |
(15.3)% |
26,012 |
29,131 |
(10.7)% |
Dji Sam Soe |
8,599 |
7,578 |
13.5% |
23,089 |
21,151 |
9.2% |
Bond Street |
7,687 |
8,595 |
(10.6)% |
21,099 |
23,960 |
(11.9)% |
Lark |
4,955 |
6,058 |
(18.2)% |
15,575 |
17,604 |
(11.5)% |
Fortune |
3,215 |
4,052 |
(20.7)% |
9,702 |
11,791 |
(17.7)% |
Others |
18,337 |
24,088 |
(23.9)% |
59,954 |
71,344 |
(16.0)% |
Total Cigarettes |
183,519 |
195,068 |
(5.9)% |
531,615 |
550,069 |
(3.4)% |
Heated Tobacco Units (1) |
15,985 |
8,652 |
84.8% |
42,539 |
29,205 |
45.7% |
Total PMI |
199,504 |
203,720 |
(2.1)% |
574,154 |
579,274 |
(0.9)% |
(1) Includes shipments to Altria Group, Inc., commencing in the third quarter of 2019, for sale in the United States under license. |
||||||
Note: Sampoerna A includes Sampoerna; Philip Morris includes Philip Morris/Dubliss; and Lark includes Lark Harmony. |
Third-Quarter
PMI's cigarette shipment volume of the following brands decreased:
The increase in PMI's heated tobacco unit shipment volume was mainly driven by the EU, notably
PMI's cigarette shipment volume of the following brands increased:
International Share of Market
PMI's total international market share (excluding
PMI's total international cigarette market share, defined as PMI's cigarette sales volume as a percentage of total industry cigarette sales volume, was 27.3%, down by 0.4 points, mainly reflecting: out-switching to IQOS, notably in the EU Region,
Nine Months Year-to-Date
PMI's cigarette shipment volume of the following brands decreased:
The increase in PMI's heated tobacco unit shipment volume was mainly driven by: the EU, notably
PMI's cigarette shipment volume of the following brands increased:
International Share of Market
PMI's total international market share (excluding
PMI's total international cigarette market share, defined as PMI's cigarette sales volume as a percentage of total industry cigarette sales volume, was 26.9%, down by 0.2 points.
CONSOLIDATED FINANCIAL SUMMARY
Third-Quarter
Financial Summary - |
|
|
|
|
Change |
|
Variance |
|||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
|||
(in millions) |
|
|
|
|||||||||||
Net Revenues |
|
$ 7,642 |
$ 7,504 |
|
1.8% |
3.4% |
|
138 |
(115) |
266 |
263 |
(276) |
||
Cost of Sales |
|
(2,605) |
(2,618) |
|
0.5% |
(0.6)% |
|
13 |
30 |
— |
(181) |
164 |
||
Marketing, Administration and Research Costs (2) |
|
(2,234) |
(1,710) |
|
(30.6)% |
(34.8)% |
|
(524) |
71 |
— |
— |
(595) |
||
Amortization of Intangibles |
|
(15) |
(20) |
|
25.0% |
15.0% |
|
5 |
2 |
— |
— |
3 |
||
Operating Income |
|
$ 2,788 |
$ 3,156 |
|
(11.7)% |
(11.3)% |
|
(368) |
(12) |
266 |
82 |
(704) |
||
Asset Impairment & Exit Costs (3) |
|
(22) |
— |
|
—% |
—% |
|
(22) |
— |
— |
— |
(22) |
||
Russia Excise and VAT Audit Charge (3) |
|
(374) |
— |
|
—% |
—% |
|
(374) |
— |
— |
— |
(374) |
||
Adjusted Operating Income |
|
$ 3,184 |
$ 3,156 |
|
0.9% |
1.3% |
|
28 |
(12) |
266 |
82 |
(308) |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Adjusted Operating Income Margin |
|
41.7% |
42.1% |
|
(0.4)pp |
(0.9)pp |
|
|
|
|
|
|
||
(1) Cost/Other variance includes the impact of the RBH deconsolidation. |
||||||||||||||
(2) Unfavorable Cost/Other variance includes 2019 asset impairment and exit costs and the Russia excise and VAT audit charge. |
||||||||||||||
(3) Included in Marketing, Administration and Research Costs above. |
||||||||||||||
Note: Net Revenues include revenues from shipments of the IQOS heated tobacco device, heated tobacco units and accessories to Altria Group, Inc., commencing in the third quarter of 2019, for sale under license in the United States. |
Net revenues, excluding unfavorable currency, increased by 3.4%, mainly reflecting: a favorable pricing variance, driven notably by
Operating income, excluding unfavorable currency, decreased by 11.3%. Excluding asset impairment and exit charges related to a plant closure in
Adjusted operating income margin, excluding currency, decreased by 0.9 points to 41.2%, reflecting the factors mentioned above, as detailed in the attached Schedule 8, or increased by 0.4 points to 41.2% on a like-for-like basis, as detailed in the attached Schedule 9.
Nine Months Year-to-Date
Financial Summary - |
|
|
|
|
Change |
|
Variance |
|||||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
|||||
(in millions) |
|
|
|
|||||||||||||
Net Revenues |
|
$ |
22,092 |
$ |
22,126 |
|
(0.2)% |
4.1% |
|
(34) |
(931) |
953 |
457 |
(513) |
||
Cost of Sales |
|
(7,735) |
(7,977) |
|
3.0% |
(0.4)% |
|
242 |
274 |
— |
(255) |
223 |
||||
Marketing, Administration and Research Costs (2) |
|
(6,282) |
(5,411) |
|
(16.1)% |
(22.3)% |
|
(871) |
333 |
— |
— |
(1,204) |
||||
Amortization of Intangibles |
|
(50) |
(63) |
|
20.6% |
15.9% |
|
13 |
3 |
— |
— |
10 |
||||
Operating Income |
|
$ |
8,025 |
$ |
8,675 |
|
(7.5)% |
(3.8)% |
|
(650) |
(321) |
953 |
202 |
(1,484) |
||
Asset Impairment & Exit Costs (3) |
|
(65) |
— |
|
—% |
—% |
|
(65) |
— |
— |
— |
(65) |
||||
Canadian Tobacco Litigation-Related Expense (3) |
|
(194) |
— |
|
—% |
—% |
|
(194) |
— |
— |
— |
(194) |
||||
Loss on Deconsolidation of RBH (3) |
|
(239) |
— |
|
—% |
—% |
|
(239) |
— |
— |
— |
(239) |
||||
Russia Excise and VAT Audit Charge (3) |
|
(374) |
— |
|
—% |
—% |
|
(374) |
— |
— |
— |
(374) |
||||
Adjusted Operating Income |
|
$ |
8,897 |
$ |
8,675 |
|
2.6% |
6.3% |
|
222 |
(321) |
953 |
202 |
(612) |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjusted Operating Income Margin |
|
40.3% |
39.2% |
|
1.1pp |
0.8pp |
|
|
|
|
|
|
||||
(1) Cost/Other variance includes the impact of the RBH deconsolidation. |
||||||||||||||||
(2) Unfavorable Cost/Other variance includes the 2019 Canadian tobacco litigation-related expense, the loss on deconsolidation of RBH, asset impairment and exit costs, the impact of the RBH deconsolidation and the Russia excise and VAT audit charge. |
||||||||||||||||
(3) Included in Marketing, Administration and Research Costs above. |
||||||||||||||||
Note: Net Revenues include revenues from shipments of the IQOS heated tobacco device, heated tobacco units and accessories to Altria Group, Inc., commencing in the third quarter of 2019, for sale under license in the United States. |
Net revenues, excluding unfavorable currency, increased by 4.1%, mainly reflecting: a favorable pricing variance, notably in
Operating income, excluding unfavorable currency, decreased by 3.8%. Excluding the loss on deconsolidation of RBH, the Canadian tobacco litigation-related expense, and asset impairment and exit charges related to plant closures in
Adjusted operating income margin, excluding currency, increased by 0.8 points to 40.0%, reflecting the factors mentioned above, as detailed in the attached Schedule 8, or by 1.6 points to 40.0% on a like-for-like basis, as detailed in the attached Schedule 9.
EUROPEAN
Third-Quarter
Financial Summary - |
|
|
|
|
Change |
|
Variance |
|||||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
|||||
(in millions) |
|
|
|
|||||||||||||
Net Revenues |
|
$ |
2,645 |
$ |
2,467 |
|
7.2% |
11.2% |
|
178 |
(98) |
54 |
222 |
— |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating Income |
|
$ |
1,255 |
$ |
1,179 |
|
6.4% |
12.0% |
|
76 |
(66) |
54 |
153 |
(65) |
||
Asset Impairment & Exit Costs |
|
— |
— |
|
—% |
—% |
|
— |
— |
— |
— |
— |
||||
Adjusted Operating Income |
|
$ |
1,255 |
$ |
1,179 |
|
6.4% |
12.0% |
|
76 |
(66) |
54 |
153 |
(65) |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjusted Operating Income Margin |
|
47.4% |
47.8% |
|
(0.4)pp |
0.4pp |
|
|
|
|
|
|
Net revenues, excluding unfavorable currency, increased by 11.2%, reflecting a favorable pricing variance, driven principally by
Operating income, excluding unfavorable currency, increased by 12.0%, mainly reflecting: a favorable pricing variance; favorable volume/mix, driven by heated tobacco unit volume, notably in the
Adjusted operating income margin, excluding currency, increased by 0.4 points to 48.2%, reflecting the factors mentioned above, as detailed on Schedule 8.
Nine Months Year-to-Date
Financial Summary - |
|
|
|
|
Change |
|
Variance |
|||||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
|||||
(in millions) |
|
|
|
|||||||||||||
Net Revenues |
|
$ |
7,381 |
$ |
6,958 |
|
6.1% |
12.6% |
|
423 |
(457) |
206 |
674 |
— |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating Income |
|
$ |
3,346 |
$ |
3,096 |
|
8.1% |
16.5% |
|
250 |
(261) |
206 |
518 |
(213) |
||
Asset Impairment & Exit Costs |
|
— |
— |
|
—% |
—% |
|
— |
— |
— |
— |
— |
||||
Adjusted Operating Income |
|
$ |
3,346 |
$ |
3,096 |
|
8.1% |
16.5% |
|
250 |
(261) |
206 |
518 |
(213) |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjusted Operating Income Margin |
|
45.3% |
44.5% |
|
0.8pp |
1.5pp |
|
|
|
|
|
|
Net revenues, excluding unfavorable currency, increased by 12.6%, reflecting a favorable pricing variance, driven principally by
Operating income, excluding unfavorable currency, increased by 16.5%, mainly reflecting: a favorable pricing variance; favorable volume/mix, notably in the
Adjusted operating income margin, excluding currency, increased by 1.5 points to 46.0%, reflecting the factors mentioned above, as detailed on Schedule 8.
Total Market, PMI Shipment & Market Share Commentaries
European Union Key Data |
|
Third-Quarter |
|
Nine Months Year-to-Date |
||||||||||
|
|
|
|
Change |
|
|
|
Change |
||||||
|
|
2019 |
2018 |
% / pp |
|
2019 |
2018 |
% / pp |
||||||
Total Market (billion units) |
|
132.1 |
131.4 |
0.5% |
|
363.8 |
365.2 |
(0.4)% |
||||||
|
|
|
|
|
|
|
|
|
||||||
PMI Shipment Volume (million units) |
|
|
|
|
|
|
|
|
||||||
Cigarettes |
|
47,238 |
48,223 |
(2.0)% |
|
133,093 |
135,878 |
(2.0)% |
||||||
Heated Tobacco Units |
|
3,474 |
1,730 |
+100.0% |
|
8,810 |
3,853 |
+100.0% |
||||||
Total EU |
|
50,712 |
49,953 |
1.5% |
|
141,903 |
139,731 |
1.6% |
||||||
|
|
|
|
|
|
|
|
|
||||||
PMI Market Share |
|
|
|
|
|
|
|
|
||||||
Marlboro |
|
18.0% |
18.5% |
(0.5) |
|
18.1% |
18.4% |
(0.3) |
||||||
L&M |
|
6.7% |
7.0% |
(0.3) |
|
6.7% |
6.9% |
(0.2) |
||||||
Chesterfield |
|
5.8% |
5.9% |
(0.1) |
|
5.8% |
5.9% |
(0.1) |
||||||
Philip Morris |
|
2.7% |
2.9% |
(0.2) |
|
2.7% |
3.0% |
(0.3) |
||||||
HEETS |
|
2.5% |
1.2% |
1.3 |
|
2.3% |
1.0% |
1.3 |
||||||
Others |
|
3.0% |
3.0% |
— |
|
3.2% |
3.2% |
— |
||||||
Total EU |
|
38.7% |
38.5% |
0.2 |
|
38.8% |
38.4% |
0.4 |
Third-Quarter
The estimated total market in the EU increased by 0.5% to 132.1 billion units, mainly driven by:
partly offset by
PMI's total shipment volume increased by 1.5% to 50.7 billion units, reflecting:
partly offset by:
Nine Months Year-to-Date
The estimated total market in the EU decreased by 0.4% to 363.8 billion units, notably due to:
partly offset by
PMI's total shipment volume increased by 1.6% to 141.9 billion units, reflecting:
partly offset by
Third-Quarter
Financial Summary - |
|
|
|
|
Change |
|
Variance |
||||||||||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
||||||||||
(in millions) |
|
|
|
||||||||||||||||||
Net Revenues |
|
$ 899 |
$ 778 |
|
15.6% |
16.5% |
|
121 |
(7) |
(3) |
131 |
— |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating Income (Loss) |
|
$ (101) |
$ 270 |
|
-(100)% |
-(100)% |
|
(371) |
25 |
(3) |
32 |
(425) |
|||||||||
Asset Impairment & Exit Costs |
|
— |
— |
|
—% |
—% |
|
— |
— |
— |
— |
— |
|||||||||
Russia Excise and VAT Audit Charge (1) |
|
(374) |
— |
|
—% |
—% |
|
(374) |
— |
— |
— |
(374) |
|||||||||
Adjusted Operating Income |
|
$ 273 |
$ 270 |
|
1.1% |
(8.1)% |
|
3 |
25 |
(3) |
32 |
(51) |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Adjusted Operating Income Margin |
|
30.4% |
34.7% |
|
(4.3)pp |
(7.3)pp |
|
|
|
|
|
|
|||||||||
(1) Included in marketing, administration and research costs at the consolidated operating income level. |
Net revenues, excluding unfavorable currency, increased by 16.5%, reflecting favorable volume/mix, predominantly driven by heated tobacco unit volume in
Operating income, excluding favorable currency, decreased by over 100% due primarily to the unfavorable impact, shown in "Cost/Other," of the
Adjusted operating income margin, excluding currency, decreased by 7.3 points to 27.4%, reflecting the factors mentioned above, as detailed on Schedule 8.
Nine Months Year-to-Date
Financial Summary - |
|
|
|
|
Change |
|
Variance |
||||||||||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
||||||||||
(in millions) |
|
|
|
||||||||||||||||||
Net Revenues |
|
$ 2,300 |
$ 2,105 |
|
9.3% |
15.8% |
|
195 |
(137) |
50 |
282 |
— |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating Income |
|
$ 284 |
$ 682 |
|
(58.4)% |
(56.9)% |
|
(398) |
(10) |
50 |
73 |
(511) |
|||||||||
Asset Impairment & Exit Costs |
|
— |
— |
|
—% |
—% |
|
— |
— |
— |
— |
— |
|||||||||
Russia Excise and VAT Audit Charge (1) |
|
(374) |
— |
|
—% |
—% |
|
(374) |
— |
— |
— |
(374) |
|||||||||
Adjusted Operating Income |
|
$ 658 |
$ 682 |
|
(3.5)% |
(2.1)% |
|
(24) |
(10) |
50 |
73 |
(137) |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Adjusted Operating Income Margin |
|
28.6% |
32.4% |
|
(3.8)pp |
(5.0)pp |
|
|
|
|
|
|
|||||||||
(1) Included in marketing, administration and research costs at the consolidated operating income level. |
Net revenues, excluding unfavorable currency, increased by 15.8%, reflecting a favorable pricing variance, driven notably by
Operating income, excluding unfavorable currency, decreased by 56.9% due primarily to the unfavorable impact, shown in "Cost/Other," of the
Adjusted operating income margin, excluding currency, decreased by 5.0 points to 27.4%, reflecting the factors mentioned above, as detailed on Schedule 8.
Total Market, PMI Shipment & Market Share Commentaries
PMI Shipment Volume |
Third-Quarter |
Nine Months Year-to-Date |
|||||||
(million units) |
2019 |
2018 |
Change |
2019 |
2018 |
Change |
|||
Cigarettes |
27,379 |
29,801 |
(8.1)% |
|
74,779 |
80,294 |
(6.9)% |
||
Heated Tobacco Units |
3,858 |
1,152 |
+100.0% |
|
8,213 |
2,667 |
+100.0% |
||
Total Eastern Europe |
31,237 |
30,953 |
0.9% |
|
82,992 |
82,961 |
—% |
Third-Quarter
The estimated total market in
partly offset by
PMI's total shipment volume increased by 0.9% to 31.2 billion units, driven by:
partly offset by
Nine Months Year-to-Date
The estimated total market in
partly offset by
PMI's total shipment volume was flat at 83.0 billion units, notably reflecting:
offset by
Third-Quarter
Financial Summary - |
|
|
|
|
Change |
|
Variance |
|||||||||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
|||||||||
(in millions) |
|
|
|
|||||||||||||||||
Net Revenues |
|
$ 1,127 |
$ 1,143 |
|
(1.4)% |
—% |
|
(16) |
(16) |
89 |
(70) |
(19) |
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating Income |
|
$ 519 |
$ 491 |
|
5.7% |
4.9% |
|
28 |
4 |
89 |
(69) |
4 |
||||||||
Asset Impairment & Exit Costs |
|
— |
— |
|
—% |
—% |
|
— |
— |
— |
— |
— |
||||||||
Adjusted Operating Income |
|
$ 519 |
$ 491 |
|
5.7% |
4.9% |
|
28 |
4 |
89 |
(69) |
4 |
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted Operating Income Margin |
|
46.1% |
43.0% |
|
3.1pp |
2.1pp |
|
|
|
|
|
|
Net revenues, excluding unfavorable currency, were flat, reflecting a favorable pricing variance, driven predominantly by
Operating income, excluding favorable currency, increased by 4.9%, mainly reflecting a favorable pricing variance and lower manufacturing costs, partly offset by unfavorable volume/mix, reflecting the same drivers as for net revenues noted above, and the timing of other revenues.
Adjusted operating income margin, excluding currency, increased by 2.1 points to 45.1%, reflecting the factors mentioned above, as detailed on Schedule 8.
Nine Months Year-to-Date
Financial Summary - |
|
|
|
|
Change |
|
Variance |
|||||||||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
|||||||||
(in millions) |
|
|
|
|||||||||||||||||
Net Revenues |
|
$ 3,058 |
$ 3,126 |
|
(2.2)% |
3.4% |
|
(68) |
(174) |
154 |
(45) |
(3) |
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating Income |
|
$ 1,304 |
$ 1,268 |
|
2.8% |
8.2% |
|
36 |
(68) |
154 |
(81) |
31 |
||||||||
Asset Impairment & Exit Costs |
|
— |
— |
|
—% |
—% |
|
— |
— |
— |
— |
— |
||||||||
Adjusted Operating Income |
|
$ 1,304 |
$ 1,268 |
|
2.8% |
8.2% |
|
36 |
(68) |
154 |
(81) |
31 |
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Adjusted Operating Income Margin |
|
42.6% |
40.6% |
|
2.0pp |
1.9pp |
|
|
|
|
|
|
Net revenues, excluding unfavorable currency, increased by 3.4%, mainly reflecting: a favorable pricing variance, primarily driven by
Operating income, excluding unfavorable currency, increased by 8.2%, mainly reflecting a favorable pricing variance and lower manufacturing costs, partly offset by unfavorable volume/mix, notably due to unfavorable cigarette and heated tobacco unit volume in PMI Duty Free, partly offset by cigarette mix in
Adjusted operating income margin, excluding currency, increased by 1.9 points to 42.5%, reflecting the factors mentioned above, as detailed on Schedule 8.
Total Market, PMI Shipment & Market Share Commentaries
PMI Shipment Volume |
Third-Quarter |
|
Nine Months Year-to-Date |
||||||
(million units) |
2019 |
2018 |
Change |
|
2019 |
2018 |
Change |
||
Cigarettes |
36,994 |
37,406 |
(1.1)% |
|
101,957 |
100,831 |
1.1% |
||
Heated Tobacco Units |
588 |
1,152 |
(49.0)% |
|
2,061 |
2,832 |
(27.2)% |
||
Total Middle East & Africa |
37,582 |
38,558 |
(2.5)% |
|
104,018 |
103,663 |
0.3% |
Third-Quarter
The estimated total market in the
partly offset by
PMI's total shipment volume decreased by 2.5% to 37.6 billion units, notably due to:
partly offset by
Nine Months Year-to-Date
The estimated total market in the
partly offset by
PMI's total shipment volume increased by 0.3% to 104.0 billion units, notably in:
partly offset by
SOUTH &
Third-Quarter
Financial Summary - |
|
|
|
|
Change |
|
Variance |
||||||||||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
||||||||||
(in millions) |
|
|
|
||||||||||||||||||
Net Revenues |
|
$ 1,246 |
$ 1,197 |
|
4.1% |
2.8% |
|
49 |
15 |
123 |
(89) |
— |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating Income |
|
$ 539 |
$ 455 |
|
18.5% |
14.3% |
|
84 |
19 |
123 |
(64) |
6 |
|||||||||
Asset Impairment & Exit Costs |
|
— |
— |
|
—% |
—% |
|
— |
— |
— |
— |
— |
|||||||||
Adjusted Operating Income |
|
$ 539 |
$ 455 |
|
18.5% |
14.3% |
|
84 |
19 |
123 |
(64 ) |
6 |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Adjusted Operating Income Margin |
|
43.3% |
38.0% |
|
5.3pp |
4.2pp |
|
|
|
|
|
|
Net revenues, excluding favorable currency, increased by 2.8%, predominantly reflecting a favorable pricing variance driven by
Operating income, excluding favorable currency, increased by 14.3%, predominantly reflecting: a favorable pricing variance; lower manufacturing costs, mainly in
Adjusted operating income margin, excluding currency, increased by 4.2 points to 42.2%, reflecting the factors mentioned above, as detailed on Schedule 8.
Nine Months Year-to-Date
Financial Summary - |
|
|
|
|
Change |
|
Variance |
||||||||||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
||||||||||
(in millions) |
|
|
|
||||||||||||||||||
Net Revenues |
|
$ 3,607 |
$ 3,434 |
|
5.0% |
7.3% |
|
173 |
(78) |
313 |
(62) |
— |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating Income |
|
$ 1,471 |
$ 1,324 |
|
11.1% |
13.0% |
|
147 |
(25) |
313 |
(41) |
(100) |
|||||||||
Asset Impairment & Exit Costs (1) |
|
(20) |
— |
|
—% |
—% |
|
(20) |
— |
— |
— |
(20) |
|||||||||
Adjusted Operating Income |
|
$ 1,491 |
$ 1,324 |
|
12.6% |
14.5% |
|
167 |
(25) |
313 |
(41) |
(80) |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Adjusted Operating Income Margin |
|
41.3% |
38.6% |
|
2.7pp |
2.5pp |
|
|
|
|
|
|
|||||||||
(1) Included in marketing, administration and research costs at the consolidated operating income level. |
Net revenues, excluding unfavorable currency, increased by 7.3%, reflecting: a favorable pricing variance, driven principally by
Operating income, excluding unfavorable currency, increased by 13.0%. Excluding asset impairment and exit costs related to a plant closure in
Adjusted operating income margin, excluding currency, increased by 2.5 points to 41.1%, reflecting the factors mentioned above, as detailed on Schedule 8.
Total Market, PMI Shipment & Market Share Commentaries
PMI Shipment Volume |
Third-Quarter |
Nine Months Year-to-Date |
|||||||
(million units) |
2019 |
2018 |
Change |
2019 |
2018 |
Change |
|||
Cigarettes |
42,362 |
45,840 |
(7.6)% |
|
130,230 |
130,846 |
(0.5)% |
||
Heated Tobacco Units |
— |
— |
—% |
|
— |
— |
—% |
||
Total South & Southeast Asia |
42,362 |
45,840 |
(7.6 )% |
|
130,230 |
130,846 |
(0.5)% |
Third-Quarter
The estimated total market in South &
partly offset by
PMI's total shipment volume decreased by 7.6% to 42.4 billion units, notably due to:
partly offset by
Nine Months Year-to-Date
The estimated total market in South &
partly offset by
PMI's total shipment volume decreased by 0.5% to 130.2 billion units, notably due to:
partly offset by
Third-Quarter
Financial Summary - |
|
|
|
|
Change |
|
Variance |
|||||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
|||||
(in millions) |
|
|
|
|||||||||||||
Net Revenues |
|
$ 1,252 |
$ 1,166 |
|
7.4% |
7.5% |
|
86 |
(1) |
(21) |
108 |
— |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating Income |
|
$ 451 |
$ 426 |
|
5.9% |
3.1% |
|
25 |
12 |
(21) |
64 |
(30) |
||||
Asset Impairment & Exit Costs |
|
— |
— |
|
—% |
—% |
|
— |
— |
— |
— |
— |
||||
Adjusted Operating Income |
|
$ 451 |
$ 426 |
|
5.9% |
3.1% |
|
25 |
12 |
(21) |
64 |
(30) |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjusted Operating Income Margin |
|
36.0% |
36.5% |
|
(0.5)pp |
(1.5)pp |
|
|
|
|
|
|
Net revenues, excluding unfavorable currency, increased by 7.5%, reflecting favorable volume/mix, mainly driven by heated tobacco units in
Operating income, excluding favorable currency, increased by 3.1%, mainly reflecting favorable volume/mix, mainly driven by favorable heated tobacco unit volume in
Adjusted operating income margin, excluding currency, decreased by 1.5 points to 35.0%, reflecting the factors mentioned above, as detailed on Schedule 8.
Nine Months Year-to-Date
Financial Summary - |
|
|
|
|
Change |
|
Variance |
||||||||||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
||||||||||
(in millions) |
|
|
|
||||||||||||||||||
Net Revenues |
|
$ 4,094 |
$ 4,235 |
|
(3.3)% |
(2.7)% |
|
(141) |
(26) |
186 |
(301) |
— |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating Income |
|
$ 1,520 |
$ 1,439 |
|
5.6% |
3.3% |
|
81 |
33 |
186 |
(190) |
52 |
|||||||||
Asset Impairment & Exit Costs |
|
— |
— |
|
—% |
—% |
|
— |
— |
— |
— |
— |
|||||||||
Adjusted Operating Income |
|
$ 1,520 |
$ 1,439 |
|
5.6% |
3.3% |
|
81 |
33 |
186 |
(190) |
52 |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Adjusted Operating Income Margin |
|
37.1% |
34.0% |
|
3.1pp |
2.1pp |
|
|
|
|
|
|
Net revenues, excluding unfavorable currency, decreased by 2.7%, reflecting: unfavorable volume/mix, mainly due to lower cigarette shipment volume in
Operating income, excluding favorable currency, increased by 3.3%, mainly reflecting: a favorable pricing variance and lower manufacturing costs related to
Adjusted operating income margin, excluding currency, increased by 2.1 points to 36.1%, reflecting the factors mentioned above, as detailed on Schedule 8.
Total Market, PMI Shipment & Market Share Commentaries
PMI Shipment Volume |
Third-Quarter |
Nine Months Year-to-Date |
|||||||
(million units) |
2019 |
2018 |
Change |
2019 |
2018 |
Change |
|||
Cigarettes |
12,692 |
14,186 |
(10.5)% |
|
38,650 |
43,391 |
(10.9)% |
||
Heated Tobacco Units |
7,976 |
4,575 |
74.3% |
|
23,253 |
19,755 |
17.7% |
||
Total East Asia & Australia |
20,668 |
18,761 |
10.2% |
|
61,903 |
63,146 |
(2.0)% |
Third-Quarter
The estimated total market in
PMI's total shipment volume increased by 10.2% to 20.7 billion units, notably in:
partly offset by
Nine Months Year-to-Date
The estimated total market in
PMI's total shipment volume decreased by 2.0% to 61.9 billion units, notably in:
partly offset by
Third-Quarter
Financial Summary - |
|
|
|
|
Change |
|
Variance |
||||||||||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
||||||||||
(in millions) |
|
|
|
||||||||||||||||||
Net Revenues |
|
$ 473 |
$ 753 |
|
(37.2)% |
(36.1)% |
|
(280) |
(8) |
24 |
(39) |
(257) |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating Income |
|
$ 125 |
$ 335 |
|
(62.7)% |
(60.9)% |
|
(210) |
(6) |
24 |
(34) |
(194) |
|||||||||
Asset Impairment & Exit Costs (2) |
|
(22) |
— |
|
—% |
—% |
|
(22) |
— |
— |
— |
(22) |
|||||||||
Adjusted Operating Income |
|
$ 147 |
$ 335 |
|
(56.1)% |
(54.3)% |
|
(188) |
(6) |
24 |
(34) |
(172) |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Adjusted Operating Income Margin |
|
31.1% |
44.5% |
|
(13.4)pp |
(12.7)pp |
|
|
|
|
|
|
(1) Unfavorable Cost/Other variance includes the impact of the RBH deconsolidation. |
Net revenues, excluding unfavorable currency, decreased by 36.1%, almost entirely due to the unfavorable impact of the deconsolidation of RBH shown in "Cost/Other." On a like-for-like basis, net revenues, excluding unfavorable currency, decreased by 3.8%, as detailed in the attached Schedule 10, reflecting unfavorable volume/mix, mainly due to
Operating income, excluding unfavorable currency, decreased by 60.9%, predominantly due to the unfavorable impact of the deconsolidation of RBH, shown in "Cost/Other." Excluding asset impairment and exit costs related to a plant closure in
Adjusted operating income margin, excluding currency, decreased by 12.7 points to 31.8%, reflecting the factors mentioned above, as detailed on Schedule 8, or increased by 4.0 points to 31.7% on a like-for-like basis, as detailed in the attached Schedule 10.
Nine Months Year-to-Date
Financial Summary - |
|
|
|
|
Change |
|
Variance |
||||||||||||||
|
2019 |
2018 |
|
Total |
Excl. |
|
Total |
Cur- |
Price |
Vol/ |
Cost/ |
||||||||||
(in millions) |
|
|
|
||||||||||||||||||
Net Revenues |
|
$ 1,652 |
$ 2,268 |
|
(27.2)% |
(24.6)% |
|
(616) |
(59) |
44 |
(91) |
(510) |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating Income |
|
$ 100 |
$ 866 |
|
(88.5)% |
(89.6)% |
|
(766) |
10 |
44 |
(77) |
(743) |
|||||||||
Asset Impairment & Exit Costs (2) |
|
(45) |
— |
|
—% |
—% |
|
(45) |
— |
— |
— |
(45) |
|||||||||
Canadian Tobacco Litigation-Related Expense (2) |
|
(194) |
— |
|
—% |
—% |
|
(194) |
— |
— |
— |
(194) |
|||||||||
Loss on Deconsolidation of RBH (2) |
|
(239) |
— |
|
—% |
—% |
|
(239) |
— |
— |
— |
(239) |
|||||||||
Adjusted Operating Income |
|
$ 578 |
$ 866 |
|
(33.3)% |
(34.4)% |
|
(288) |
10 |
44 |
(77) |
(265) |
|||||||||
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|||||||||
Adjusted Operating Income Margin |
|
35.0% |
38.2% |
|
(3.2)pp |
(5.0)pp |
|
|
|
|
|
|
(1) Unfavorable Cost/Other variance includes the impact of the RBH deconsolidation. |
Net revenues, excluding unfavorable currency, decreased by 24.6%, predominantly due to the unfavorable impact of the deconsolidation of RBH, shown in "Cost/Other." On a like-for-like basis, net revenues, excluding unfavorable currency, decreased by 3.0%, as detailed in the attached Schedule 10, reflecting: unfavorable volume, mainly due to
Operating income, excluding favorable currency, decreased by 89.6%, predominantly due to the unfavorable impact of the deconsolidation of RBH and reporting adjustments, shown in "Cost/Other." Excluding asset impairment and exit costs related to a plant closure in
Adjusted operating income margin, excluding currency, decreased by 5.0 points to 33.2%, reflecting the factors mentioned above, as detailed on Schedule 8, or increased by 5.2 points to 33.2% on a like-for-like basis, as detailed in the attached Schedule 10.
Total Market, PMI Shipment & Market Share Commentaries
PMI Shipment Volume |
Third-Quarter |
Nine Months Year-to-Date |
|||||||
(million units) |
2019 |
2018 |
Change |
2019 |
2018 |
Change |
|||
Cigarettes |
16,854 |
19,612 |
(14.1)% |
|
52,906 |
58,829 |
(10.1 )% |
||
Heated Tobacco Units |
89 |
43 |
+100.0% |
|
202 |
98 |
+100.0% |
||
Total Latin America & Canada |
16,943 |
19,655 |
(13.8)% |
|
53,108 |
58,927 |
(9.9 )% |
Third-Quarter
The estimated total market in
partly offset by:
PMI's total shipment volume decreased by 13.8% to 16.9 billion units, or by 6.9% on a like-for-like basis, in part due to:
Nine Months Year-to-Date
The estimated total market in
PMI's total shipment volume decreased by 9.9% to 53.1 billion units, or by 5.2% on a like-for-like basis, in part due to:
Forward-Looking and Cautionary Statements
This press release contains projections of future results and other forward-looking statements. Achievement of future results is subject to risks, uncertainties and inaccurate assumptions. In the event that risks or uncertainties materialize, or underlying assumptions prove inaccurate, actual results could vary materially from those contained in such forward-looking statements. Pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, PMI is identifying important factors that, individually or in the aggregate, could cause actual results and outcomes to differ materially from those contained in any forward-looking statements made by PMI.
PMI's business risks include: excise tax increases and discriminatory tax structures; increasing marketing and regulatory restrictions that could reduce our competitiveness, eliminate our ability to communicate with adult consumers, or ban certain of our products; health concerns relating to the use of tobacco products and exposure to environmental tobacco smoke; litigation related to tobacco use; intense competition; the effects of global and individual country economic, regulatory and political developments, natural disasters and conflicts; changes in adult smoker behavior; lost revenues as a result of counterfeiting, contraband and cross-border purchases; governmental investigations; unfavorable currency exchange rates and currency devaluations, and limitations on the ability to repatriate funds; adverse changes in applicable corporate tax laws; adverse changes in the cost and quality of tobacco and other agricultural products and raw materials; and the integrity of its information systems and effectiveness of its data privacy policies. PMI's future profitability may also be adversely affected should it be unsuccessful in its attempts to produce and commercialize reduced-risk products or if regulation or taxation do not differentiate between such products and cigarettes; if it is unable to successfully introduce new products, promote brand equity, enter new markets or improve its margins through increased prices and productivity gains; if it is unable to expand its brand portfolio internally or through acquisitions and the development of strategic business relationships; or if it is unable to attract and retain the best global talent. Future results are also subject to the lower predictability of our reduced-risk product category's performance.
PMI is further subject to other risks detailed from time to time in its publicly filed documents, including the Form 10-Q for the quarter ended
Key Terms, Definitions and Explanatory Notes
General
Financial
Reduced-Risk Products
[NEW] IQOS in
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Appendix 1 |
|||||||||||||||||||
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries |
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Key Market Data |
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Quarters Ended September 30, |
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Market |
|
Total Market, |
|
PMI Shipments, bio units |
|
PMI Market Share, % (1) |
|||||||||||||||||||||||||||||||||||||
|
|
Total |
|
Cigarette |
|
HTU |
|
Total |
|
HTU |
|||||||||||||||||||||||||||||||||
|
2019 |
2018 |
% |
|
2019 |
2018 |
% |
|
2019 |
2018 |
% |
|
2019 |
2018 |
% |
|
2019 |
2018 |
pp |
|
2019 |
2018 |
pp |
||||||||||||||||||||
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Total PMI |
|
696.1 |
|
720.1 |
|
(3.3 |
) |
|
199.5 |
|
203.7 |
|
(2.1 |
) |
|
183.5 |
|
195.1 |
|
(5.9 |
) |
|
16.0 |
|
8.7 |
|
84.8 |
|
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28.8 |
|
28.9 |
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(0.1 |
) |
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2.3 |
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1.7 |
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0.6 |
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European Union |
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France |
|
10.2 |
|
10.7 |
|
(4.8 |
) |
|
4.5 |
|
4.6 |
|
(2.8 |
) |
|
4.5 |
|
4.6 |
|
(3.0 |
) |
|
— |
|
— |
|
— |
|
|
45.0 |
|
45.7 |
|
(0.7 |
) |
|
0.2 |
|
0.1 |
|
0.1 |
|
|
Germany |
|
20.7 |
|
20.5 |
|
1.3 |
|
|
7.4 |
|
7.3 |
|
1.7 |
|
|
7.2 |
|
7.2 |
|
(0.1 |
) |
|
0.2 |
|
0.1 |
|
+100.0 |
|
|
35.7 |
|
35.5 |
|
0.2 |
|
|
1.1 |
|
0.5 |
|
0.6 |
|
|
Italy |
|
18.3 |
|
18.3 |
|
0.3 |
|
|
9.5 |
|
9.3 |
|
2.2 |
|
|
8.5 |
|
8.8 |
|
(3.6 |
) |
|
1.1 |
|
0.5 |
|
95.8 |
|
|
52.0 |
|
51.9 |
|
0.1 |
|
|
4.6 |
|
2.0 |
|
2.6 |
|
|
Poland |
|
12.5 |
|
11.9 |
|
4.3 |
|
|
5.3 |
|
5.2 |
|
2.3 |
|
|
5.0 |
|
5.1 |
|
(1.5 |
) |
|
0.3 |
|
0.1 |
|
+100.0 |
|
|
42.5 |
|
43.4 |
|
(0.9 |
) |
|
2.4 |
|
0.9 |
|
1.5 |
|
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Spain |
|
12.6 |
|
12.5 |
|
0.8 |
|
|
3.8 |
|
3.9 |
|
(1.5 |
) |
|
3.8 |
|
3.8 |
|
(2.0 |
) |
|
0.1 |
|
0.1 |
|
25.9 |
|
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31.6 |
|
32.4 |
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(0.8 |
) |
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0.7 |
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0.4 |
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0.3 |
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Eastern Europe |
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Russia |
|
|
61.4 |
|
65.3 |
|
(5.9 |
) |
|
18.9 |
|
18.4 |
|
2.8 |
|
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16.2 |
|
17.6 |
|
(8.0 |
) |
|
2.7 |
|
0.7 |
|
+100.0 |
|
|
30.9 |
|
28.3 |
|
2.6 |
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4.0 |
|
1.1 |
|
2.9 |
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Middle East & Africa |
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Saudi Arabia |
|
5.5 |
|
5.3 |
|
4.1 |
|
|
2.0 |
|
2.5 |
|
(21.1 |
) |
|
2.0 |
|
2.5 |
|
(21.1 |
) |
|
— |
|
— |
|
— |
|
|
40.8 |
|
41.7 |
|
(0.9 |
) |
|
— |
|
— |
|
— |
|
|
Turkey |
|
|
33.8 |
|
33.7 |
|
0.3 |
|
|
14.2 |
|
15.9 |
|
(10.7 |
) |
|
14.2 |
|
15.9 |
|
(10.7 |
) |
|
— |
|
— |
|
— |
|
|
41.9 |
|
47.1 |
|
(5.2 |
) |
|
— |
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— |
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— |
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South & Southeast Asia |
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Indonesia |
|
79.0 |
|
80.3 |
|
(1.6 |
) |
|
25.0 |
|
26.5 |
|
(5.7 |
) |
|
25.0 |
|
26.5 |
|
(5.7 |
) |
|
— |
|
— |
|
— |
|
|
31.7 |
|
33.0 |
|
(1.3 |
) |
|
— |
|
— |
|
— |
|
|
Philippines |
|
17.2 |
|
18.3 |
|
(5.8 |
) |
|
12.4 |
|
12.7 |
|
(2.8 |
) |
|
12.4 |
|
12.7 |
|
(2.8 |
) |
|
— |
|
— |
|
— |
|
|
71.8 |
|
69.5 |
|
2.3 |
|
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— |
|
— |
|
— |
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East Asia & Australia |
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Australia |
|
3.2 |
|
3.4 |
|
(7.4 |
) |
|
0.9 |
|
1.0 |
|
(11.8 |
) |
|
0.9 |
|
1.0 |
|
(11.8 |
) |
|
— |
|
— |
|
— |
|
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27.7 |
|
29.1 |
|
(1.4 |
) |
|
— |
|
— |
|
— |
|
|
Japan |
|
42.1 |
|
48.3 |
|
(12.9 |
) |
|
13.3 |
|
10.7 |
|
24.5 |
|
|
6.5 |
|
7.5 |
|
(13.4 |
) |
|
6.8 |
|
3.2 |
|
+100.0 |
|
|
34.3 |
|
33.7 |
|
0.6 |
|
|
17.0 |
|
15.5 |
|
1.5 |
|
|
Korea |
|
18.4 |
|
18.7 |
|
(1.9 |
) |
|
4.1 |
|
4.6 |
|
(10.5 |
) |
|
2.9 |
|
3.2 |
|
(7.1 |
) |
|
1.1 |
|
1.4 |
|
(18.4 |
) |
|
22.2 |
|
24.2 |
|
(2.0 |
) |
|
6.2 |
|
7.4 |
|
(1.2 |
) |
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Latin America & Canada |
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Argentina |
|
8.3 |
|
8.1 |
|
2.3 |
|
|
5.9 |
|
6.1 |
|
(3.0 |
) |
|
5.9 |
|
6.1 |
|
(3.0 |
) |
|
— |
|
— |
|
— |
|
|
70.4 |
|
75.2 |
|
(4.8 |
) |
|
— |
|
— |
|
— |
|
|
Mexico |
|
7.7 |
|
8.5 |
|
(9.8 |
) |
|
4.9 |
|
5.9 |
|
(17.3 |
) |
|
4.9 |
|
5.9 |
|
(17.3 |
) |
|
— |
|
— |
|
— |
|
|
63.4 |
|
69.1 |
|
(5.7 |
) |
|
— |
|
— |
|
— |
|
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||||||||||||||||||
(1) Market share estimates are calculated using IMS data |
|||||||||||||||||||||||||||||||||||||||||||
Note: % change for Total Market and PMI shipments is computed based on millions of units; PMI Market Share estimates for previous periods are restated to reflect RBH deconsolidation and exclude RBH-owned brands. |
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Appendix 2 |
|||||||||||||||||||
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries |
|||||||||||||||||||||||||||||||||||||||||||
Key Market Data |
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||||||||||||||||||
|
|
|
Nine Months Ended September 30, |
||||||||||||||||||||||||||||||||||||||||
Market |
|
Total Market, |
|
PMI Shipments, bio units |
|
PMI Market Share, % (1) |
|||||||||||||||||||||||||||||||||||||
|
|
Total |
|
Cigarette |
|
HTU |
|
Total |
|
HTU |
|||||||||||||||||||||||||||||||||
|
2019 |
2018 |
% |
|
2019 |
2018 |
% |
|
2019 |
2018 |
% |
|
2019 |
2018 |
% |
|
2019 |
2018 |
pp |
|
2019 |
2018 |
pp |
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Total PMI |
|
2,023.2 |
|
2,057.6 |
|
(1.7 |
) |
|
574.2 |
|
579.3 |
|
(0.9 |
) |
|
531.6 |
|
550.1 |
|
(3.4 |
) |
|
42.5 |
|
29.2 |
|
45.7 |
|
|
28.3 |
|
28.1 |
|
0.2 |
|
|
2.1 |
|
1.6 |
|
0.5 |
|
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European Union |
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France |
|
29.1 |
|
31.1 |
|
(6.4 |
) |
|
13.1 |
|
14.0 |
|
(6.6 |
) |
|
13.1 |
|
14.0 |
|
(6.8 |
) |
|
0.1 |
|
— |
|
— |
|
|
44.9 |
|
45.3 |
|
(0.4 |
) |
|
0.2 |
|
0.1 |
|
0.1 |
|
|
Germany |
|
55.1 |
|
56.1 |
|
(1.9 |
) |
|
20.8 |
|
20.5 |
|
1.1 |
|
|
20.2 |
|
20.3 |
|
(0.6 |
) |
|
0.6 |
|
0.3 |
|
+100.0 |
|
|
37.7 |
|
36.6 |
|
1.1 |
|
|
1.1 |
|
0.5 |
|
0.6 |
|
|
Italy |
|
51.1 |
|
52.0 |
|
(1.8 |
) |
|
26.6 |
|
26.6 |
|
(0.1 |
) |
|
24.1 |
|
25.5 |
|
(5.3 |
) |
|
2.5 |
|
1.1 |
|
+100.0 |
|
|
51.6 |
|
51.8 |
|
(0.2 |
) |
|
4.3 |
|
1.8 |
|
2.5 |
|
|
Poland |
|
35.4 |
|
33.1 |
|
6.7 |
|
|
14.5 |
|
13.8 |
|
5.5 |
|
|
13.8 |
|
13.6 |
|
1.8 |
|
|
0.7 |
|
0.2 |
|
+100.0 |
|
|
41.1 |
|
41.6 |
|
(0.5 |
) |
|
2.1 |
|
0.7 |
|
1.4 |
|
|
Spain |
|
34.4 |
|
34.1 |
|
0.9 |
|
|
11.3 |
|
11.1 |
|
2.5 |
|
|
11.1 |
|
10.9 |
|
1.5 |
|
|
0.2 |
|
0.1 |
|
79.7 |
|
|
31.5 |
|
32.1 |
|
(0.6 |
) |
|
0.7 |
|
0.4 |
|
0.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Eastern Europe |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Russia |
|
|
167.7 |
|
177.2 |
|
(5.3 |
) |
|
48.8 |
|
48.7 |
|
0.1 |
|
|
43.4 |
|
47.1 |
|
(7.8 |
) |
|
5.3 |
|
1.6 |
|
+100.0 |
|
|
29.7 |
|
27.8 |
|
1.9 |
|
|
3.3 |
|
0.8 |
|
2.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Middle East & Africa |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Saudi Arabia |
|
16.1 |
|
15.2 |
|
6.3 |
|
|
6.7 |
|
5.3 |
|
26.1 |
|
|
6.7 |
|
5.3 |
|
26.1 |
|
|
— |
|
— |
|
— |
|
|
40.5 |
|
41.1 |
|
(0.6 |
) |
|
— |
|
— |
|
— |
|
|
Turkey |
|
|
95.4 |
|
88.2 |
|
8.2 |
|
|
40.6 |
|
40.9 |
|
(0.7 |
) |
|
40.6 |
|
40.9 |
|
(0.7 |
) |
|
— |
|
— |
|
— |
|
|
42.5 |
|
46.4 |
|
(3.9 |
) |
|
— |
|
— |
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
South & Southeast Asia |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Indonesia |
|
226.3 |
|
224.8 |
|
0.7 |
|
|
72.1 |
|
74.5 |
|
(3.2 |
) |
|
72.1 |
|
74.5 |
|
(3.2 |
) |
|
— |
|
— |
|
— |
|
|
31.9 |
|
33.1 |
|
(1.2 |
) |
|
— |
|
— |
|
— |
|
|
Philippines |
|
52.6 |
|
52.6 |
|
(0.1 |
) |
|
37.2 |
|
36.7 |
|
1.5 |
|
|
37.2 |
|
36.7 |
|
1.5 |
|
|
— |
|
— |
|
— |
|
|
70.8 |
|
69.8 |
|
1.0 |
|
|
— |
|
— |
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
East Asia & Australia |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Australia |
|
9.2 |
|
9.6 |
|
(4.3 |
) |
|
2.6 |
|
2.8 |
|
(9.6 |
) |
|
2.6 |
|
2.8 |
|
(9.6 |
) |
|
— |
|
— |
|
— |
|
|
27.6 |
|
29.3 |
|
(1.7 |
) |
|
— |
|
— |
|
— |
|
|
Japan |
|
120.3 |
|
130.4 |
|
(7.7 |
) |
|
40.5 |
|
39.9 |
|
1.4 |
|
|
20.9 |
|
24.2 |
|
(13.3 |
) |
|
19.5 |
|
15.8 |
|
23.9 |
|
|
34.3 |
|
34.2 |
|
0.1 |
|
|
16.9 |
|
15.6 |
|
1.3 |
|
|
Korea |
|
51.7 |
|
52.4 |
|
(1.4 |
) |
|
11.8 |
|
13.1 |
|
(10.0 |
) |
|
8.2 |
|
9.1 |
|
(10.0 |
) |
|
3.6 |
|
4.0 |
|
(9.9 |
) |
|
22.9 |
|
24.9 |
|
(2.0 |
) |
|
6.9 |
|
7.6 |
|
(0.7 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Latin America & Canada |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Argentina |
|
24.6 |
|
25.8 |
|
(4.9 |
) |
|
17.6 |
|
19.1 |
|
(8.1 |
) |
|
17.6 |
|
19.1 |
|
(8.1 |
) |
|
— |
|
— |
|
— |
|
|
71.5 |
|
74.0 |
|
(2.5 |
) |
|
— |
|
— |
|
— |
|
|
Mexico |
|
25.1 |
|
25.4 |
|
(1.1 |
) |
|
16.6 |
|
16.9 |
|
(1.9 |
) |
|
16.6 |
|
16.9 |
|
(1.9 |
) |
|
— |
|
— |
|
— |
|
|
65.9 |
|
66.4 |
|
(0.5 |
) |
|
— |
|
— |
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
(1) Market share estimates are calculated using IMS data |
|||||||||||||||||||||||||||||||||||||||||||
Note: % change for Total Market and PMI shipments is computed based on millions of units; PMI Market Share estimates for previous periods are restated to reflect RBH deconsolidation and exclude RBH-owned brands. |
|||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Appendix 3 |
|||
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries |
||||||||||||||||
Reconciliation of Non-GAAP Measures |
||||||||||||||||
Shipment Volume Adjusted for the Impact of RBH Deconsolidation |
||||||||||||||||
(in million units) / (Unaudited) |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Total PMI |
|
Quarters Ended September 30, |
|
Nine Months Ended September 30, |
|||||||||||
|
|
|
2019 |
2018 |
% Change |
|
2019 |
2018 |
% Change |
|||||||
|
Total Shipment Volume |
|
199,504 |
|
203,720 |
|
(2.1)% |
|
574,154 |
|
579,274 |
|
(0.9)% |
|||
|
Shipment Volume for RBH-owned brands (1) |
|
|
|
(1,462) |
|
|
|
|
|
(2,922) |
(2) |
|
|||
|
Total Shipment Volume |
|
199,504 |
|
202,258 |
(3) |
(1.4)% |
|
574,154 |
|
576,352 |
(3) |
(0.4)% |
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Latin America & Canada |
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Total Shipment Volume |
|
16,943 |
|
19,655 |
|
(13.8)% |
|
53,108 |
|
58,927 |
|
(9.9)% |
|||
|
Shipment Volume for RBH-owned brands |
|
|
|
(1,450) |
|
|
|
|
|
(2,896) |
(2) |
|
|||
|
Total Shipment Volume |
|
16,943 |
|
18,205 |
(3) |
(6.9)% |
|
53,108 |
|
56,031 |
(3) |
(5.2)% |
(1) Includes Duty Free sales in Canada (2) Represents volume for RBH-owned brands from March 22, 2018 through end of period date (3) Pro forma Note: Shipment Volume includes Cigarettes and Heated Tobacco Units; following the deconsolidation of RBH, we report the volume of brands sold by RBH for which other PMI subsidiaries are the trademark owners |
|
|
|
|
|
|
|
|
|
|
|
|
|
Schedule 1 |
|||||||||||
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries |
||||||||||||||||||||||||
Diluted Earnings Per Share (EPS) |
||||||||||||||||||||||||
($ in millions, except per share data) / (Unaudited) |
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
Quarters Ended |
|
Diluted EPS |
|
Nine Months Ended |
||||||||||||||||||
|
|
September 30, |
|
|
September 30, |
|||||||||||||||||||
|
|
|
|
$ |
1.22 |
|
|
|
|
2019 Diluted Earnings Per Share (1) |
|
|
|
$ |
3.57 |
|
|
|
||||||
|
|
|
|
$ |
1.44 |
|
|
|
|
2018 Diluted Earnings Per Share (1) |
|
|
|
$ |
3.85 |
|
|
|
||||||
|
|
|
|
$ |
(0.22 |
) |
|
|
|
Change |
|
|
|
$ |
(0.28 |
) |
|
|
||||||
|
|
|
|
(15.3 |
)% |
|
|
|
% Change |
|
|
|
(7.3 |
)% |
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
Reconciliation: |
|
|
|
|
|
|
||||||||||
|
|
|
|
$ |
1.44 |
|
|
|
|
2018 Diluted Earnings Per Share (1) |
|
|
|
$ |
3.85 |
|
|
|
||||||
|
|
|
|
— |
|
|
|
|
2018 Asset impairment and exit costs |
|
|
|
— |
|
|
|
||||||||
|
|
|
|
— |
|
|
|
|
2018 Tax items |
|
|
|
— |
|
|
|
||||||||
|
|
|
|
(0.01 |
) |
|
|
|
2019 Asset impairment and exit costs |
|
|
|
(0.03 |
) |
|
|
||||||||
|
|
|
|
— |
|
|
|
|
2019 Canadian tobacco litigation-related expense |
|
|
|
(0.09 |
) |
|
|
||||||||
|
|
|
|
— |
|
|
|
|
2019 Loss on deconsolidation of RBH |
|
|
|
(0.12 |
) |
|
|
||||||||
|
|
|
|
(0.20 |
) |
|
|
|
2019 Russia excise and VAT audit charge |
|
|
|
(0.20 |
) |
|
|
||||||||
|
|
|
|
— |
|
|
|
|
2019 Tax items |
|
|
|
0.04 |
|
|
|
||||||||
|
|
|
|
— |
|
|
|
|
Currency |
|
|
|
(0.13 |
) |
|
|
||||||||
|
|
|
|
0.01 |
|
|
|
|
Interest |
|
|
|
0.04 |
|
|
|
||||||||
|
|
|
|
— |
|
|
|
|
Change in tax rate |
|
|
|
0.03 |
|
|
|
||||||||
|
|
|
|
(0.02 |
) |
|
|
|
Operations (2) |
|
|
|
0.18 |
|
|
|
||||||||
|
|
|
|
$ |
1.22 |
|
|
|
|
2019 Diluted Earnings Per Share (1) |
|
|
|
$ |
3.57 |
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
(1) Basic and diluted EPS were calculated using the following (in millions): |
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
Quarters Ended |
|
|
|
Nine Months Ended |
||||||||||||||||||
|
|
September 30, |
|
|
|
September 30, |
||||||||||||||||||
|
|
2019 |
|
2018 |
|
|
|
2019 |
|
2018 |
||||||||||||||
|
|
$ 1,896 |
|
$ 2,247 |
|
Net Earnings attributable to PMI |
|
$ 5,569 |
|
$ 6,001 |
||||||||||||||
|
|
5 |
|
5 |
|
Less distributed and undistributed earnings attributable |
|
13 |
|
13 |
||||||||||||||
|
|
$ 1,891 |
|
$ 2,242 |
|
Net Earnings for basic and diluted EPS |
|
$ 5,556 |
|
$ 5,988 |
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
1,556 |
|
1,555 |
|
Weighted-average shares for basic EPS |
|
1,556 |
|
|
1,555 |
|
||||||||||||
|
|
— |
|
|
— |
|
|
Plus Contingently Issuable Performance Stock Units |
|
— |
|
— |
|
|||||||||||
|
|
1,556 |
|
1,555 |
|
Weighted-average shares for diluted EPS |
|
1,556 |
|
|
1,555 |
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
(2) Includes the impact of shares outstanding and share-based payments |
|
|
|
|
|
|
|
|
|
|
|
|
Schedule 2 |
|
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries |
|||||||||||||
Reconciliation of Non-GAAP Measures |
|||||||||||||
Reconciliation of Reported Diluted EPS to Reported Diluted EPS, excluding Currency, |
|||||||||||||
and Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS, excluding Currency |
|||||||||||||
(Unaudited) |
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarters Ended September 30, |
|
|
|
Nine Months Ended September 30, |
|
|
|
||||
|
|
2019 |
2018 |
% Change |
|
|
|
2019 |
2018 |
% Change |
|
|
|
|
|
$ 1.22 |
$ 1.44 |
(15.3)% |
|
Reported Diluted EPS |
|
$ 3.57 |
$ 3.85 |
(7.3)% |
|
|
|
|
|
— |
|
|
|
Currency |
|
(0.13) |
|
|
|
|
|
|
|
$ 1.22 |
$ 1.44 |
(15.3)% |
|
Reported Diluted EPS, excluding Currency |
|
$ 3.70 |
$ 3.85 |
(3.9)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarters Ended September 30, |
|
|
|
Nine Months Ended September 30, |
|
|
Year Ended |
||||
|
|
2019 |
2018 |
% Change |
|
|
|
2019 |
2018 |
% Change |
|
|
2018 |
|
|
$ 1.22 |
$ 1.44 |
(15.3)% |
|
Reported Diluted EPS |
|
$ 3.57 |
$ 3.85 |
(7.3)% |
|
|
$ 5.08 |
|
|
0.01 |
— |
|
|
Asset impairment and exit costs |
|
0.03 |
— |
|
|
|
— |
|
|
— |
— |
|
|
Canadian tobacco litigation-related expense |
|
0.09 |
— |
|
|
|
— |
|
|
— |
— |
|
|
Loss on deconsolidation of RBH |
|
0.12 |
— |
|
|
|
— |
|
|
0.20 |
— |
|
|
Russia excise and VAT audit charge |
|
0.20 |
— |
|
|
|
— |
|
|
— |
— |
|
|
Tax items |
|
(0.04) |
— |
|
|
|
0.02 |
|
|
$ 1.43 |
$ 1.44 |
(0.7)% |
|
Adjusted Diluted EPS |
|
$ 3.97 |
$ 3.85 |
3.1% |
|
|
$ 5.10 |
|
|
— |
|
|
|
Currency |
|
(0.13) |
|
|
|
|
|
|
|
$ 1.43 |
$ 1.44 |
(0.7)% |
|
Adjusted Diluted EPS, excluding Currency |
|
$ 4.10 |
$ 3.85 |
6.5% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Schedule 3 |
|||
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries |
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Reconciliation of Non-GAAP Measures |
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Reconciliation of Reported Diluted EPS to Pro Forma Adjusted Diluted EPS |
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(Unaudited) |
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Quarter |
Quarter |
Six Months |
Quarter |
Nine Months |
Quarter |
Year |
Quarter |
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March 31, |
June 30, |
June 30, |
September 30, |
September 30, |
December 31, |
December 31, |
March 31, |
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2018 |
2018 |
2018 |
2018 |
2018 |
2018 |
2018 |
2019 |
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Reported Diluted EPS |
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$ 1.00 |
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$ 1.41 |
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$ 2.41 |
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$ 1.44 |
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$ 3.85 |
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$ 1.23 |
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$5.08 |
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$ 0.87 |
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Asset impairment and exit costs |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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0.01 |
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Canadian tobacco litigation-related expense |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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0.09 |
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Loss on deconsolidation of RBH |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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0.12 |
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Tax items |
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— |
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— |
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— |
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— |
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— |
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0.02 |
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0.02 |
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— |
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Adjusted Diluted EPS |
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$ 1.00 |
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$ 1.41 |
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$ 2.41 |
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$ 1.44 |
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$ 3.85 |
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$ 1.25 |
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$ 5.10 |
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$ 1.09 |
(3) |
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Net earnings attributable to RBH |
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— |
(1) |
(0.08) |
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(0.08) |
(1) |
(0.09) |
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(0.18) |
(1) |
(0.08) |
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(0.26) |
(1) |
— |
(2) |
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Pro Forma Adjusted Diluted EPS |
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$ 1.00 |
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$ 1.33 |
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$ 2.33 |
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$ 1.35 |
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$ 3.67 |
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$ 1.17 |
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$ 4.84 |
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(1) Represents the impact of net earnings attributable to RBH from March 22, 2018 through end of period date |
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Schedule 4 |
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PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries |
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Reconciliation of Non-GAAP Measures |
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Net Revenues by Product Category and Adjustments of Net Revenues for the Impact of Currency and Acquisitions |
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($ in millions) / (Unaudited) |
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Net |
Currency |
Net |
Acquisitions |
Net |
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Quarters Ended |
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Net |
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Total |
Excluding |
Excluding |
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2019 |
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Combustible Products |
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2018 |
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% Change |
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$ 2,178 |
$ (81) |
$ 2,259 |
$ — |
$ 2,259 |
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European Union |
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$ 2,225 |
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(2.1)% |
1.6% |
1.6% |
664 |
(4) |
668 |
— |
668 |
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Eastern Europe |
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705 |
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(5.8)% |
(5.2)% |
(5.2)% |
1,064 |
(17) |
1,081 |
— |
1,081 |
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Middle East & Africa |
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1,019 |
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4.4% |
6.1% |
6.1% |
1,246 |
15 |
1,231 |
— |
1,231 |
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South & Southeast Asia |
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1,197 |
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4.1% |
2.8% |
2.8% |
680 |
(8) |
687 |
— |
687 |
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East Asia & Australia |
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789 |
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(13.8)% |
(12.8)% |
(12.8)% |
466 |
(8) |
473 |
— |
473 |
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Latin America & Canada |
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748 |
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(37.7)% |
(36.7)% |
(36.7)% |
$ 6,298 |
$ (102) |
$ 6,399 |
$ — |
$ 6,399 |
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Total Combustible |
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$ 6,681 |
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(5.7)% |
(4.2)% |
(4.2)% |
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2019 |
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Reduced-Risk Products |
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2018 |
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% Change |
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$ 467 |
$ (17) |
$ 484 |
$ — |
$ 484 |
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European Union |
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$ 242 |
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92.5% |
99.6% |
99.6% |
235 |
(3) |
238 |
— |
238 |
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Eastern Europe |
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73 |
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+100% |
+100% |
+100% |
63 |
1 |
62 |
— |
62 |
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Middle East & Africa |
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124 |
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(49.2)% |
(49.9)% |
(49.9)% |
— |
— |
— |
— |
— |
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South & Southeast Asia |
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— |
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—% |
—% |
—% |
572 |
7 |
566 |
— |
566 |
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East Asia & Australia |
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377 |
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51.6% |
49.9% |
49.9% |
7 |
— |
8 |
— |
8 |
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Latin America & Canada(1) |
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5 |
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44.2% |
50.5% |
50.5% |
$ 1,344 |
$ (13) |
$ 1,358 |
$ — |
$ 1,358 |
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Total RRPs |
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$ 823 |
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63.4% |
65.1% |
65.1% |
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2019 |
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PMI |
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2018 |
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% Change |
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$ 2,645 |
$ (98) |
$ 2,743 |
$ — |
$ 2,743 |
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European Union |
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$ 2,467 |
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7.2% |
11.2% |
11.2% |
899 |
(7) |
906 |
— |
906 |
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Eastern Europe |
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778 |
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15.6% |
16.5% |
16.5% |
1,127 |
(16) |
1,143 |
— |
1,143 |
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Middle East & Africa |
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1,143 |
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(1.4)% |
—% |
—% |
1,246 |
15 |
1,231 |
— |
1,231 |
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South & Southeast Asia |
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1,197 |
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4.1% |
2.8% |
2.8% |
1,252 |
(1) |
1,253 |
— |
1,253 |
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East Asia & Australia |
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1,166 |
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7.4% |
7.5% |
7.5% |
473 |
(8) |
481 |
— |
481 |
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Latin America & Canada |
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753 |
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(37.2)% |
(36.1)% |
(36.1)% |
$ 7,642 |
$ (115) |
$ 7,757 |
$ — |
$ 7,757 |
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Total PMI |
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$ 7,504 |
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1.8% |
3.4% |
3.4% |
(1) Net Revenues include revenues from shipments of the IQOS heated tobacco device, heated tobacco units and accessories to Altria Group, Inc., commencing in the third quarter of 2019, for sale under license in the United States. |
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Schedule 5 |
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PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries |
||||||||||||
Reconciliation of Non-GAAP Measures |
||||||||||||
Net Revenues by Product Category and Adjustments of Net Revenues for the Impact of Currency and Acquisitions |
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($ in millions) / (Unaudited) |
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Net |
Currency |
Net |
Acquisitions |
Net |
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Nine Months Ended |
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Net |
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Total |
Excluding |
Excluding |
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2019 |
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Combustible Products |
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2018 |
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% Change |
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$ 6,139 |
$ (381) |
$ 6,520 |
$ — |
$ 6,520 |
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European Union |
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$ 6,381 |
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(3.8)% |
2.2% |
2.2% |
1,774 |
(106) |
1,880 |
— |
1,880 |
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Eastern Europe |
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1,926 |
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(7.9)% |
(2.4)% |
(2.4)% |
2,810 |
(172) |
2,982 |
— |
2,982 |
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Middle East & Africa |
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2,813 |
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(0.1)% |
6.0% |
6.0% |
3,607 |
(78) |
3,685 |
— |
3,685 |
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South & Southeast Asia |
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3,434 |
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5.0% |
7.3% |
7.3% |
2,074 |
(33) |
2,106 |
— |
2,106 |
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East Asia & Australia |
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2,348 |
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(11.7)% |
(10.3)% |
(10.3)% |
1,634 |
(58) |
1,692 |
— |
1,692 |
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Latin America & Canada |
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2,254 |
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(27.5)% |
(24.9)% |
(24.9)% |
$ 18,039 |
$ (827) |
$ 18,865 |
$ — |
$ 18,865 |
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Total Combustible |
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$ 19,156 |
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(5.8)% |
(1.5)% |
(1.5)% |
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2019 |
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Reduced-Risk Products |
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2018 |
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% Change |
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$ 1,242 |