Philip Morris International Inc. (PMI) has reported its first-quarter results for 2024, showing strong top-line growth and significant margin expansion. This has led to the company raising its 2024 currency-neutral guidance, according to Jacek Olczak, the Chief Executive Officer. The smoke-free business (SFB) accounted for 39% of the total net revenues, with regions such as EA, AU & PMI DF leading the way towards becoming a smoke-free company. The SFB saw a 21.1% increase in net revenues and a 31.8% increase in gross profit.
IQOS, an inhalable smoke-free product, has strengthened its position as the second largest nicotine ‘brand’ in markets where it is present, holding the number one position in 11 markets. In Europe, IQOS HTU market share exceeded 10% for the first time, and in Japan, the market share increased by over 3 percentage points to over 29%. IQOS has also surpassed combustible cigarettes in Tokyo, showcasing its potential globally. PMI introduced the innovative IQOS ILUMA i to celebrate the product’s 10-year anniversary in Japan.
The Oral SFP2 category saw shipment volume increase by 40.0% in cans, driven by the growth of ZYN nicotine pouches in the U.S. The shipment volume in the U.S. reached 131.6 million cans, representing a growth of 79.7% compared to the prior year. PMI’s share of the category in the U.S. increased for the fourth consecutive quarter to over 74%. Net revenues for combustibles grew by 3.5%, with strong pricing across markets contributing to the growth. Marlboro, a popular brand under the combustibles category, gained 0.4 percentage points in category share.
Despite the challenging operating environment impacted by geopolitical and economic tensions, PMI is focused on executing efficiently to deliver robust growth and value creation. The company’s confidence in raising its 2024 currency-neutral guidance is supported by the strong performance in the first quarter and the continuous momentum in the smoke-free business. PMI’s commitment to mitigating challenges and leveraging the operating leverage of IQOS and ZYN to drive growth is evident in the quarter’s results.
The company also declared a regular quarterly dividend of $1.30 per share, which translates to an annualized rate of $5.20 per share. This highlights PMI’s commitment to delivering value to its shareholders while maintaining a strong financial position. The positive outlook for the company, based on the first-quarter results and the growth across various product categories, underscores PMI’s resilience and ability to navigate through challenging market conditions. With a focus on smoke-free products and innovative offerings, PMI is well-positioned to drive growth and create long-term value for its stakeholders.
