PMI(US:PM) ZACKSยท2024-11-21 17:35Core Viewpoint - Philip Morris reported strong Q3 2024 earnings, with adjusted EPS of $1.91, a 14.4% year-over-year increase, exceeding estimates. The company anticipates continued growth in 2024, driven by pricing and volume improvements in both combustible and smoke-free products [2][12]. Financial Performance - Adjusted EPS for Q3 2024 was $1.91, up 14.4% year-over-year, and 18% excluding currency effects, beating the Zacks Consensus Estimate of $1.83 [2] - Net revenues reached $9,911 million, an increase of 8.4% on a reported basis and 11.6% organically, surpassing the Zacks Consensus Estimate of $9,571 million [2][3] - Adjusted operating income rose 11.2% to $4,153 million, with an adjusted operating margin of 41.9%, up 1.1 percentage points [5] Product Segmentation - Revenues from combustible products increased 5.2%, while smoke-free business revenues grew 14.2%, accounting for 38% of total revenues [4] - Total shipment volumes increased 2.9% to 203 billion units in Q3, with notable growth in smoke-free product volumes driven by IQOS and ZYN [4] Regional Performance - European region net revenues grew 8.7% organically to $4,121 million, with total shipment volumes increasing 2.5% [6] - SSEA, CIS & MEA regions saw a 12.1% organic revenue increase to $2,964 million, with shipment volumes rising 3.2% [6] - Americas region revenues surged 30.5% organically to $1,148 million, despite a 1.1% decline in total shipment volumes [7] Strategic Developments - Philip Morris announced the sale of its subsidiary Vectura Group Ltd. to Molex Asia Holdings Ltd., expected to conclude by the end of 2024 [8] - The company raised its quarterly dividend by 3.8% to $1.35 per share but will not engage in share repurchases in 2024 [11] Future Outlook - For 2024, adjusted EPS is projected in the range of $6.45-$6.51, indicating 7.3-8.3% growth, with net revenues expected to increase 9.5% organically [12][14] - Management anticipates operating cash flow of around $11 billion and capital expenditures of $1.4 billion, including investments in ZYN [14] - The total international industry volume for cigarettes and HTUs is expected to grow up to 1% in 2024, with Philip Morris projecting a 2-3% rise in its shipment volumes [13]