Philip Morris cheers Wall Street with bumper Q2 numbers

(Sharecast News) - Shares in Philip Morris International lit up on Wednesday, after quarterly numbers at the US cigarette maker beat forecasts.

The firm, which sells Marlboro outside of the US, saw net revenues rise by 10.4% in the second quarter, or by 7.6% on an organic basis, to $11.2bn. Analysts had been looking for revenues closer to $10.63bn. Adjusted profits per share also came in ahead of consensus for $2.05 per share, rising 15.2% to $2.20.

In its smoke-free segment, revenues rose 11.7%. Smoke-free brands such as Zyn nicotine pouches and IQOS now make up around 42% of total net revenues.

However, combustibles also fared well, despite a general trend away from smokable tobacco. Revenues jumped 9.5%, as strong performances in Turkey, Indonesia and Egypt helped offset declines elsewhere. Demand also remained robust despite a 10% increase in prices, with cigarette volumes rising 1.1%, well ahead of Wall Street forecasts, after multiple quarters of decline.

Berenberg said: "In ten years of following tobacco, we struggle to remember such a big beat for a cigarette business."

As at 1530 BST, the New York-listed stock was up 3%.

Jacek Olczak, chief executive, called the results "outstanding". He said: "With a robust first half under our belt, including continued momentum and strong results in our smoke-free business, we are well-positioned to deliver on our full-year targets while investing for future growth."

Looking to the full year, PMI said it expected full-year adjusted EPS to come in between $8.26 and $8.41, compared to a previous forecast for between $8.31and $8.46. PMI said the downgrade reflected the impact of adverse currency effects only. Forecasts for organic net revenue growth of between 5% and 7% were left unchanged.