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Mar 31, 2020
Philip Morris Q1 2020 Earnings Report
Reported diluted EPS increased by 34.5%, adjusted diluted EPS grew by 11.0%, and net revenues were up by 6.0%.
Key Takeaways
Philip Morris International Inc. reported a strong first quarter with reported diluted EPS of $1.17, up 34.5% from 2019. The company has withdrawn its 2020 full-year reported diluted EPS forecast due to uncertainty related to the COVID-19 pandemic and replaced it with a quarterly forecast. The company provided a 2020 second-quarter reported diluted EPS forecast of $1.00 to $1.10, reflecting an unfavorable currency impact of approximately $0.12.
Reported diluted EPS of $1.17, up by 34.5%; up by 49.4%, excluding currency.
Adjusted diluted EPS of $1.21, up by 11.0%; up by 30.1% on a like-for-like basis, excluding currency.
Cigarette and heated tobacco unit shipment volume down by 1.2% (reflecting cigarette shipment volume down by 4.4%, and heated tobacco unit shipment volume up by 45.5% to 16.7 billion units); down by 0.6% on a like-for-like basis
Net revenues up by 6.0%; up by 10.0% on a like-for-like basis, excluding currency.
Revenue by Segment
Revenue by Geographic Location
Forward Guidance
PMI forecasts second-quarter reported diluted EPS to be in a range of $1.00 to $1.10, including an unfavorable currency impact, at prevailing exchange rates, of approximately $0.12 per share.
Positive Outlook
- a currency-neutral net revenue decline of approximately 8% to 12%, wholly attributable to COVID-19-related factors, including lower IQOS device sales; and
- no additional disruption in the company's ability to supply its customers, based on its current operations and inventory levels.
- capital expenditures of approximately $0.8 billion
- effective tax rate of approximately 23%
- Despite near-term uncertainty, our company is resilient with a robust financial position.
Challenges Ahead
- 10 cents for distributor and trade inventory movements, mainly related to reversals from the first quarter;
- 9 cents for lost Duty-Free sales, net of domestic sales recapture, assuming no recovery in global travel in the period;
- 5 to 15 cents for the impact of the delay in minimum price enforcement in Indonesia and other COVID-19-related factors, including temporary reductions in daily consumption and down-trading in certain developing markets.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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