Philip Morris unveils upbeat 2023 outlook after annual earnings beat estimates

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Philip Morris unveils upbeat 2023 outlook after annual earnings beat estimates
Credit: © Reuters.

By Scott Kanowsky -- Philip Morris International Inc (NYSE: PM ) delivered higher-than-anticipated 2023 earnings guidance despite broader economic concerns, as the company eyed a transition away from cigarettes and into so-called "smoke-free" products.

The U.S.-based group now expects adjusted earnings per share to climb to between $6.25 to $6.37, above Bloomberg consensus estimates of $5.97. The figure came in at $5.98 per share in 2022.

Net revenue is also seen growing by approximately 7% to 8.5% on an organic basis, boosted by a predicted year-on-year "acceleration" in products that heat tobacco instead of burning it.

Shares in Philip Morris rose by more than 2% in pre-market U.S. dealmaking on Thursday.

The maker of the Marlboro cigarette brand added that its purchase of over 90% of holdings in nicotine pouch manufacturer Swedish Match late last year, as well as its planned takeover of e-cigarette firm IQOS in the U.S. in 2024, put it well on track to eventually becoming a business that mainly sells smoke-free devices.

The outlook comes after adjusted core profit per share inched up to $1.39 in the three months to the end of December, beating predictions of $1.24. However, the figure was below analysts' estimates when excluding Philip Morris' operations in war-impacted Ukraine and Russia.

Meanwhile, Chief Executive Officer Jacek Olczak noted in a statement that the trading environment throughout 2022 was "challenging" due to the conflict in Ukraine, supply chain constraints and global inflationary pressures.

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