Philip Morris International (NYSE: PM) reported Q3 EPS of $1.44, $0.17 better than the analyst estimate of $1.27. Revenue for the quarter came in at $7.5 billion versus the consensus estimate of $7.16 billion.

2018 Third-Quarter

• Reported and adjusted diluted earnings per share of $1.44, up by $0.17 or 13.4% versus $1.27 in 2017
  • Excluding unfavorable currency of $0.09, adjusted diluted earnings per share up by $0.26 or 20.5% versus $1.27 in 2017 as detailed in the attached Schedule 2
• Cigarette and heated tobacco unit shipment volume of 203.7 billion, down by 2.1%, or up by 1.1% excluding the net impact of total estimated distributor inventory movements, reflecting:
  • Cigarette shipment volume of 195.1 billion units, down by 3.4 billion units or 1.7%
  • Heated tobacco unit shipment volume of 8.7 billion units, down by 1.1 billion units or 11.0%
• Net revenues of $7.5 billion, up by 0.4%
  • Excluding unfavorable currency of $213 million, net revenues up by 3.3% as detailed in the attached Schedule 3
• Operating income of $3.2 billion, up by 2.2%
  • Excluding unfavorable currency of $167 million, operating income up by 7.6% as detailed in the attached Schedule 5
• Adjusted operating income, reflecting the items detailed in the attached Schedule 6, of $3.2 billion, up by 2.2%
  • Excluding unfavorable currency of $167 million, adjusted operating income up by 7.6% as detailed in the attached Schedule 6

"Our third-quarter results demonstrate that our underlying business performance is in good shape. Excluding distributor inventory movements, our total shipment volume was up in the quarter and year-to-date, reflecting the continued growth of our heat-not-burn products as well as the solid performance of our combustible products. Our total market share was up by 0.5 and 0.6 points in the quarter and year-to-date, respectively. In addition, supported by our leading brand portfolio, pricing was strong. As a result, we continue to forecast currency-neutral EPS growth for the full year of 8-9%," said André Calantzopoulos, Chief Executive Officer.

"We remain focused on our smoke-free transformation and are very encouraged by the continued progress of our smoke-free products and initiatives, especially across the EU and Russia. As previously announced, this quarter existing IQOS device and consumable inventories were rightsized in Japan ahead of the upcoming global launch of our new IQOS 3 and IQOS 3 Multi devices. Importantly, our worldwide in-market sales of heated tobacco units this year remain set to almost double and we continue to anticipate shipments of approximately 41-42 billion units."

"Overall, as we stated recently at our Investor Day, our business is showing great momentum. As we enter this year’s final quarter, I am confident that the strategies and initiatives we have put in place set the stage for an even better business performance in 2019."

GUIDANCE:

Philip Morris International sees FY2018 EPS of $4.97-$5.02, versus the consensus of $5.01.

For earnings history and earnings-related data on Philip Morris International (PM) click here.