(Bloomberg) -- Philip Morris International Inc. abandoned its 2020 earnings guidance as the coronavirus outbreak weighs on duty-free tobacco sales.
- The company had previously forecast reported diluted EPS of at least $5.50.
- Adjusted earnings per share amounted to $1.21 in the first quarter. Analysts expected $1.13.
Key Insights
- The coronavirus didn't have a big impact on business in the first quarter. But duty-free sales have been hit, and the company expects about a 50% lower switch rate to heated-tobacco device IQOS during the lockdowns.
- Heated-tobacco unit shipments rose 46%. As Philip Morris expands that category in the U.S. through Altria Group Inc., the company last month named Martin King chief executive officer of PMI America, a newly created function.
- Chief Executive Officer Andre Calantzopoulos said some markets are reporting a certain reduction in illicit cigarette trade as the coronavirus outbreak led to border closures. That's going to benefit the company, though it's still too early to draw more conclusions.
Market Reaction
- The shares fell 3% in New York. They've dropped 12% this year, faring better than other consumer companies amid a market slump.
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- See more details.
- Read the statement.
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