Q2 2024 Philip Morris International Inc Earnings Call Transcript
Key Points
- Philip Morris International Inc (PM) reported record H1 organic topline and operating income growth, excluding the pandemic recovery year of 2021.
- Strong performance from IQOS, with shipment and adjusted in-market sales volume growth above or in line with expectations.
- ZYN continued its impressive growth trajectory with Q2 US volumes growing by over 50%, despite recent supply tensions and increased pricing.
- Combustible business overdelivered with a return to gross margin expansion ahead of plan in Q2 after two years of significant inflationary headwinds.
- H1 adjusted diluted EPS grew by an impressive 16.8% in constant currency and by 4% in dollar terms.
- The company faced a significant currency headwind of over 12%, impacting H1 adjusted diluted EPS growth.
- The ongoing delay in approval for commercialization in Taiwan has created an incremental headwind of around 2 billion units to the full-year adjusted IMS forecast.
- The implementation of the characterizing flavor ban in Europe, particularly in Italy, had a more pronounced impact than anticipated.
- ZYN faced short-term supply chain constraints, impacting volume growth.
- Geographic mix was negative, primarily due to combustible volumes increasing in lower-margin markets where smoke-free alternatives are small or not available.
Good day, and thank you for standing by. Welcome to the Philip Morris International, Inc., 2024 second-quarter results conference call. (Operator Instructions) Please be advised that today's conference is being recorded.
I would now like to hand the conference over to your speaker today, James Bushnell, Vice President of Investor Relations and Financial Communications. Please go ahead.
Welcome. Thank you for joining us. Earlier today, we issued a press release containing detailed information on our 2024 second-quarter results. The press release is available on our website at pmi.com. A glossary of terms including the definition for smoke-free products as well as adjustments, other calculations, and reconciliation to the most directly comparable US GAAP measures for non-GAAP financial measures cited in this presentation are available in Exhibit 99.2 to the company's Form 8-K dated July 23, 2024 and on our Investor Relations website.
Today's remarks contain forward-looking
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