Philip Morris Q3 2021 Earnings Report
Key Takeaways
Philip Morris International Inc. reported a strong third-quarter performance in 2021, with an adjusted diluted EPS of $1.58, representing currency-neutral growth of 8.5%. The company reaffirmed its strong growth outlook for 2021, with an adjusted diluted EPS forecast toward the upper-half of its previous range and representing currency-neutral growth of 13% to 14%.
Reported diluted EPS of $1.55, up by 4.7%; up by 2.0%, excluding currency.
Adjusted diluted EPS of $1.58, up by 11.3%; up by 8.5%, excluding currency.
Cigarette and heated tobacco unit shipment volume up by 2.1% (reflecting cigarette shipment volume down by 0.4%, and heated tobacco unit shipment volume up by 23.8% to 23.5 billion units).
Net revenues up by 9.1%; up by 7.6%, on an organic basis.
Philip Morris
Philip Morris
Philip Morris Revenue by Segment
Philip Morris Revenue by Geographic Location
Forward Guidance
PMI revises and narrows its full-year reported diluted EPS forecast to a range of $5.77 to $5.82, at prevailing exchange rates.
Positive Outlook
- A continued gradual improvement in the general operating environment, with potential volatility around the duration and effects of pandemic-related mobility restrictions across PMI's key markets.
- A slight recovery in PMI's duty-free business during the fourth quarter, following a modest improvement in the third quarter, with intercontinental and Asia travel still very subdued.
- Adjusted net revenue growth of approximately 6.5% to 7% on an organic basis.
- An increase in adjusted operating income margin of around 200 basis points on an organic basis.
- An effective tax rate, excluding discrete tax events, of around 22%.
Challenges Ahead
- Constrained IQOS device supply due to the ongoing global semiconductor shortage, with reduced device assortment and availability, and therefore lower IQOS user growth rates as PMI prioritizes devices for existing IQOS users; 2021 ILUMA launches in certain markets now planned for the second half of 2022.
- An estimated total international industry volume progression, excluding China and the U.S., of approximately flat to +1%.
- A total cigarette and heated tobacco unit shipment volume increase for PMI of approximately 1% to 2%.
- Heated tobacco unit shipment volume of around 95 billion units.
- Incremental commercial investments in the second half of 2021 of approximately $300 million versus the first half.
Revenue & Expenses
Visualization of income flow from segment revenue to net income