PMI Q1 2020 Heated Tobacco Shipments Up 45.5%
Recently, Philip Morris International (PMI), a global tobacco giant, released its Q1 financial report showing that the revenue for Q1 2020 was $7.15 billion, up from $6.75 billion in Q1 2019, a year-on-year increase of 6%; net profit was $2.79 billion, compared to $2.05 billion in 2019, a year-on-year increase of 36%.<\/p>
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PMI sold 173.75 billion cigarettes and heated tobacco in Q1 2020, down from 175.8 billion in Q1 2019. Cigarette shipments decreased from 164.3 billion in Q1 2019 to 157.02 billion in Q1 2020. In contrast, the number of heated tobacco units increased from 11.5 billion to 16.73 billion. Overall, cigarette shipments decreased by 4.4%, while shipments of heated tobacco increased by 45.5%.<\/strong>
As of the end of the quarter, the total number of IQOS users is estimated to be around 14.6 million, of which about 10.6 million have quit smoking and switched to IQOS. The market share of IQOS (excluding the U.S.) increased by 1.9 points to 6.6%. On March 30, 2020, PMI submitted a supplemental pre-market tobacco product application (PMTA) for the IQOS 3 heated tobacco device to the FDA.<\/p>
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"We started the year very strong, reflecting that our smoke-free product portfolio and the price increase of combustible tobacco drove continued structural growth," said CEO Andre Calantzopoulos. "The early stages of the Covid-19 pandemic had a limited impact on our performance, as government restrictions related to social distancing and travel were typically implemented only in March in our key markets."<\/p>
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"We expect the Covid-19 pandemic to have an adverse impact on our business performance for the full year 2020. The observed situation is related to a significant decrease in duty-free sales in Indonesia, a slower acquisition rate of IQOS users, and delays in minimum price enforcement. We must also assume that in certain markets, the related decrease in unemployment and disposable income will have a temporary impact on market dynamics or the operating capacity of certain small retailers."<\/p>
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