NYSE$PM

Philip Morris International Inc. · Q1 2020 earnings

Q1 2020 earnings · · Investor relations

Briefing

Reported diluted EPS increased by 34.5%, adjusted diluted EPS grew by 11.0%, and net revenues were up by 6.0%.

Philip Morris International Inc. reported a strong first quarter with reported diluted EPS of $1.17, up 34.5% from 2019. The company has withdrawn its 2020 full-year reported diluted EPS forecast due to uncertainty related to the COVID-19 pandemic and replaced it with a quarterly forecast. The company provided a 2020 second-quarter reported diluted EPS forecast of $1.00 to $1.10, reflecting an unfavorable currency impact of approximately $0.12.

  • Reported diluted EPS of $1.17, up by 34.5%; up by 49.4%, excluding currency.
  • Adjusted diluted EPS of $1.21, up by 11.0%; up by 30.1% on a like-for-like basis, excluding currency.
  • Cigarette and heated tobacco unit shipment volume down by 1.2% (reflecting cigarette shipment volume down by 4.4%, and heated tobacco unit shipment volume up by 45.5% to 16.7 billion units); down by 0.6% on a like-for-like basis
  • Net revenues up by 6.0%; up by 10.0% on a like-for-like basis, excluding currency.

Headline financials

Total Revenue

$7.15B

Previous: $6.75B+6.0%
EPS (adj)

$1.21

Previous: $1.09+11.0%
Capital Expenditures

-$170M

Previous: -$324M+47.5%
Free Cash Flow

$1.66B

Previous: $1.03B+60.8%
Net Income

$1.83B

Previous: $1.35B+34.9%
Operating Income

$2.79B

Previous: $2.05B+36.0%
Gross Profit

$4.75B

Previous: $4.29B+10.8%
Cash & Equivalents

$3.75B

Previous: $3.08B+21.6%
Total Assets

$37.5B

Previous: $38B-1.4%

Revenue & EPS history

Philip Morris · Revenue · Quarterly

$7.15B

Q1 2020+6%vs Q1 2019
Beat estimate in 12 of 16 quarters(75%)
ActualEstimate

Revenue by segment

Philip Morris · $7.15B total across 2 segments · Q1 2020

  • Combustible Products
    $5.6B
  • Reduced-Risk Products
    $1.56B

Forward guidance

PMI forecasts second-quarter reported diluted EPS to be in a range of $1.00 to $1.10, including an unfavorable currency impact, at prevailing exchange rates, of approximately $0.12 per share.

Tailwinds

  • a currency-neutral net revenue decline of approximately 8% to 12%, wholly attributable to COVID-19-related factors, including lower IQOS device sales; and
  • no additional disruption in the company's ability to supply its customers, based on its current operations and inventory levels.
  • capital expenditures of approximately $0.8 billion
  • effective tax rate of approximately 23%
  • Despite near-term uncertainty, our company is resilient with a robust financial position.

Headwinds

  • 10 cents for distributor and trade inventory movements, mainly related to reversals from the first quarter;
  • 9 cents for lost Duty-Free sales, net of domestic sales recapture, assuming no recovery in global travel in the period;
  • 5 to 15 cents for the impact of the delay in minimum price enforcement in Indonesia and other COVID-19-related factors, including temporary reductions in daily consumption and down-trading in certain developing markets.
  • The Indonesian government has announced that the enforcement of the new minimum price, originally scheduled for April 1, 2020, is delayed until June due to COVID-19 restrictions.
  • The company now anticipates a further adverse impact related to the COVID-19 pandemic, with the largest quarterly impact this year expected in the second quarter.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2020

Historical avgQ1 2020

+0.8%

Avg return

Earnings day

+1.6%

Avg return

5 days after

+2.2%

Avg return

30 days after

55%

40 / 73 earnings

Positive

+10.9%

Q4 2024

Best reaction

-16.9%

Q1 2018

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+6.5%+5.0%+23.5%
Q4 2025+0.4%+2.3%-6.6%
Q3 2025-4.0%-0.3%-1.5%
Q2 2025-0.4%+1.7%+0.1%
Q1 2025+2.3%+3.1%+8.6%
Q4 2024+10.9%+13.0%+15.2%
Q3 2024+10.5%+9.2%+10.3%
Q2 2024+3.9%+5.7%+12.0%
Q1 2024+5.3%+1.0%+5.9%
Q4 2023-2.5%-2.5%+1.4%
Q3 2023-0.7%-2.6%-1.4%
Q2 2023-1.3%-1.6%-4.5%
Q1 2023-3.7%-2.8%-8.2%
Q4 2022+1.1%+0.4%-2.9%
Q3 2022+0.0%+2.3%+11.3%
Q2 2022+6.8%+7.5%+11.5%
Q1 2022-0.3%-0.3%-1.8%
Q4 2021+3.7%+5.4%-14.6%
Q3 2021-0.4%-0.6%-6.1%
Q2 2021-1.4%+0.5%+3.6%
Q1 2021+2.7%+3.2%+6.3%
Q4 2020+5.0%+6.7%+7.4%
Q3 2020-5.2%-4.4%-0.4%
Q2 2020+4.3%+5.4%+7.3%
Q1 2020-4.9%-4.2%-8.3%
Q4 2019+4.2%+6.6%+4.0%
Q3 2019+1.8%+2.6%+7.2%
Q2 2019+9.5%+7.0%+4.8%
Q1 2019-1.4%-0.7%+1.6%
Q4 2018+5.9%+6.7%+15.8%
Q3 2018+5.0%+4.7%+2.1%
Q2 2018+2.6%+1.7%+3.5%
Q1 2018-16.9%-18.7%-20.4%
Q4 2017+1.1%+4.2%+9.5%
Q3 2017-2.7%-3.5%-8.8%
Q2 2017-1.7%-3.1%-5.2%
Q1 2017-3.8%-0.7%+0.7%
Q4 2016+5.4%+5.9%+14.9%
Q3 2016+0.5%+0.8%-6.5%
Q2 2016-3.3%-3.1%-2.6%
Q1 2016-2.5%
Q4 2015-0.3%
Q3 2015+3.9%
Q2 2015+3.8%
Q1 2015+9.1%
Q4 2014-1.0%
Q3 2014+2.9%
Q2 2014+1.6%
Q1 2014-1.5%
Q4 2013+4.4%
Q3 2013+1.0%
Q2 2013-1.2%
Q1 2013-2.2%
Q4 2012+3.1%
Q3 2012-4.1%
Q2 2012-0.6%
Q1 2012+0.1%
Q4 2011+1.1%
Q3 2011+0.5%
Q2 2011-1.7%
Q1 2011-1.2%
Q4 2010+0.8%
Q4 2007+0.8%
Q3 2010-1.0%
Q2 2010+0.7%
Q1 2009+0.7%
Q1 2010-0.0%
Q4 2009-1.4%
Q3 2008+2.5%
Q3 2009+2.5%
Q2 2009-2.1%
Q2 2008-2.1%
Q4 2008-2.1%

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