According to a report on the official website of Philip Morris International (PMI), the company announced its first quarter performance for 2024 on April 24th. The total net revenue was $8.8 billion, an increase of 9.7% from the previous year, exceeding the expected $8.468 billion; gross profit reached $5.6 billion, a 12.4% increase from the previous year, driven by strong performance in smoke-free products. Operating income was $3 billion, an 11.5% increase from the previous year, with organic growth of 22.2%. Highlights of the report include:
- Reported diluted earnings per share of $1.38, a 7.8% increase from the previous year, falling below the expected $1.41.
- Adjusted diluted earnings per share were $1.50, an 8.7% growth, excluding currency effects it translates to $1.70, surpassing quarterly expectations.
- Revenue from smoke-free products accounted for 39% of total net revenue, with a 21.1% growth in this segment.
- A regular quarterly dividend of $1.30 per share was declared, maintaining an annualized dividend of $5.20 per share.
PMI exceeded market expectations in first quarter profits and revenue, primarily due to strong demand for its heated tobacco products and ZYN nicotine pouches.
The flagship heated tobacco device IQOS is expected to enter the US market in the second quarter. The shipment volume of IQOS products in the first quarter was 33.1 billion, a year-on-year increase of 20.9%, compared to the previous quarter's growth rate of 6.1%.
PMI's smoke-free business (SFB) accounts for 39% of its total net revenue, with significant progress made in markets such as Japan and South Korea. IQOS has achieved a market share of over 29% in Japan, with increasing acceptance.
PMI's ZYN nicotine pouches reported strong sales performance, with canned shipment volumes increasing by 40.0% to 1.316 billion cans, a 79.7% growth compared to the same period last year. At the same time, the company also raised its forecast for shipments of nicotine pouches to the United States from an estimated 520 million cans to around 560 million cans. Net revenue organically grew by 7% to 8.5%.
PMI CEO Jacek Olczak stated in a press release:
Our strong performance in the first quarter, excellent revenue growth, and significant profit margin expansion have given us confidence to raise our currency neutral guidance for 2024. With the operational leverage of IQOS and the strong economic benefits of ZYN driving momentum in the smoke-free category, our underlying sales volume is rapidly increasing, and organic net revenue and gross profit are accelerating. In a dynamic operating environment characterized by geopolitical and economic tensions exacerbating currency fluctuations, we are executing efficiently and effectively. We are making every effort to address these challenges and achieve strong growth and value creation.
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