PMI Delivers Strong Second-Quarter Results Despite Challenges
Philip Morris International reported second-quarter 2022 net revenue of $7.83 billion, up 3.1% from the comparable 2021 period. Operating income was $3.06 billion, compared with $3.13 billion a year earlier. Heated tobacco products accounted for 29.9% of
Philip Morris International reported a net revenue of $7.83 billion for the second quarter of 2022, a 3.1% increase compared to the same quarter in 2021. Operating income was $3.06 billion, down from $3.13 billion in the same period last year. Net revenue from heated tobacco products accounted for 29.9% of total net revenue.
PMI shipped a total of 157.69 billion cigarettes and 24.82 billion heated tobacco units in the second quarter of 2022, representing an increase of 1% and 1.9%, respectively, compared to the same period in 2021.
Given the uncertainty and volatility caused by the conflict between Russia and Ukraine, PMI also provided formal financial data excluding the company's business in these markets, thus providing a more comparable view of PMI's business performance.
On a comparable basis, the company's net revenue grew by 6.2% from the second quarter of 2021 to the second quarter of 2022, while its operating income increased by 1.6%. Net revenue from smoke-free products accounted for 29.9% of total net revenue on a comparable basis.
The company has suspended its manufacturing operations in Kharkiv, Ukraine, and plans to exit the Russian market. In 2021, Ukraine accounted for about 2% of PMI's total cigarette and heated tobacco unit shipments, contributing less than 2% to PMI's total net revenue. Russia accounted for nearly 10% of total shipments, approximately 6% of PMI's net revenue.
PMI CEO Jacek Olczak stated in a statement: "First and foremost, the war in Ukraine continues to profoundly impact the lives of our employees and their families in the region. My top priority is to provide the necessary support for them, and as a company, we are focused on doing our utmost to support them during this conflict."
"Regarding our performance, we continued to deliver strong underlying performance in the second quarter, with revenue and profit growth exceeding our initial expectations. This reflects the strong momentum of IQOS, including accelerated growth in total IQOS users and heated tobacco unit market sales, as well as favorable trends in the cigarette category."
"We are raising our outlook for the year and now expect adjusted net revenue to achieve an estimated adjusted growth of 6% to 8% on an organic basis, with diluted earnings per share expected to reach 10% to 12%, supporting an estimated shipment volume of heated tobacco units of 90 to 92 billion units."
