Philip Morris beats profit and revenue expectations, but provides downbeat full-year earnings outlook

Shares of Philip Morris International Inc. PM, +1.21% edged up 0.4% in premarket trading Thursday, after the cigarette maker reported fourth-quarter profit and revenue that beat expectations, as strength in heated tobacco volume helped offset declines in cigarettes. Net income rose to $1.98 billion, or $1.27 a share, from $1.62 billion, or $1.04 a share, in the year-ago period. Excluding nonrecurring items, adjusted earnings per share came to $1.26, above the FactSet consensus of $1.21. Revenue fell 3.5% to $7.44 billion but topped the FactSet consensus of $7.44 billion. Total cigarette shipment volume dropped 11.7% to 154.68 billion units, with Marlboro shipments down 12.9% to 57.52 billion units, while heated tobacco units jumped 26.9% to 21.71 billion. Total IQOS users, or users of heat-not-burn products, were estimated at 17.6 million at end of 2020, of which about 12.7 million have switched to IQOS and stopped smoking. “We enter 2021 with favorable momentum, although certain headwinds remain, notably related to Duty Free, Indonesia and the continued effects of the pandemic,” said Chief Executive André Calantzopoulos. The company expects 2021 adjusted EPS of $5.90 to $6.00, and $5.65 to $5.75 excluding currency. The FactSet consensus for adjusted EPS was $5.81. The stock has advanced 12.2% over the past three months through Wednesday, while the S&P 500 SPX, +0.10% has gained 11.2%.