Philip Morris International Inc. (PMI) (NYSE: PM) announced its 2024 first-quarter results.
"The strength of our first-quarter results with excellent top-line growth and significant margin expansion gives us the confidence to raise our 2024 currency-neutral guidance,” said Jacek Olczak, Chief Executive Officer.
"Strong smoke-free momentum continues with rapid underlying volume progression and accelerating organic net revenue and gross profit growth, fueled by the operating leverage of IQOS and the best-in-class economics of ZYN.”
“We are executing efficiently and effectively in a dynamic operating environment of geopolitical and economic tensions that accentuate currency volatility. We are doing our utmost to mitigate these challenges and deliver robust growth and value creation.”
Highlights:
Smoke-free business (SFB): The smoke-free business accounted for 39% of our total net revenues. The path to achieving our ambition of becoming a smoke-free company is shown by the EA, AU & PMI DF region, where SFB accounted for almost two-thirds of revenue, led by Japan and Korea.
Our SFB continues to deliver superior top-line growth, with net revenues increasing by 21.1% (24.8% organically) as well as a 31.8% (37.5% organic) increase in gross profit.
Inhalable smoke-free products (SFP): IQOS continues to strengthen its position as the second largest nicotine ‘brand’ in markets where present, including the #1 position in 11 markets. HTU adjusted in-market sales (IMS) volume, which excludes the net impact of estimated distributor and wholesaler inventory movements, was up by an estimated 12.5%.
In Europe, IQOS HTU market share exceeded 10% for the first time with adjusted IMS growth of 9.4%, which was influenced, as expected, by the impact from the EU characterizing flavor ban.
In Japan, IQOS HTU market share increased by more than 3 percentage points to over 29%, with adjusted IMS growth of 13.3%. Notably, the heat-not-burn category surpassed combustible cigarettes in Tokyo, a demonstration of the vast potential of IQOS around the world. To celebrate the 10-year anniversary of the IQOS launch in Japan, we introduced IQOS ILUMA i, our most innovative offering to-date, with very positive initial consumer feedback.
Oral SFP2: Shipment volume increased by 40.0% in cans (35.8% in pouches or pouch equivalents), fueled by ZYN nicotine pouch growth in the U.S., where shipment volume reached 131.6 million cans, representing growth of 79.7% versus prior year. Our share of the category in the U.S. increased for the fourth consecutive quarter to over 74%, up 1.3 percentage points sequentially.
Combustibles: Net revenues grew by 3.5% (organically by 3.7%), fueled by another quarter of strong pricing across markets. Our category share increased by 0.3 percentage points with Marlboro gaining 0.4 percentage points.
Dividend: Declared regular quarterly dividend of $1.30 per share, or an annualized rate of $5.20 per share.
