Philip Morris International Inc.: Philip Morris International Inc. (PMI) Reports 2013 Second-Quarter Results; Revises 2013 Full

  Philip Morris International Inc.: Philip Morris International Inc. (PMI)
  Reports 2013 Second-Quarter Results; Revises 2013 Full-Year Reported Diluted
  EPS Forecast for Currency Only; Underlying Business Outlook Unchanged

UK Regulatory Announcement

NEW YORK

Second-Quarter 2013

  *Reported diluted earnings per share of $1.30, down by $0.06 or 4.4% versus
    $1.36 in 2012

       *Excluding unfavorable currency of $0.07, reported diluted earnings
         per share up by $0.01 or 0.7% versus $1.36 in 2012 as detailed in the
         attached Schedule 13

  *Adjusted diluted earnings per share of $1.30, down by $0.06 or 4.4% versus
    $1.36 in 2012

       *Excluding unfavorable currency of $0.07, adjusted diluted earnings
         per share up by $0.01 or 0.7% versus $1.36 in 2012 as detailed in the
         attached Schedule 12

  *Cigarette shipment volume of 228.9 billion units, down by 3.9%

       *Cigarette shipment volume decrease of 2.6%, excluding the Philippines

  *Reported net revenues, excluding excise taxes, of $7.9 billion, down by
    2.5%

       *Excluding unfavorable currency, reported net revenues, excluding
         excise taxes, up by 0.5%

  *Reported operating companies income of $3.4 billion, down by 7.3%

       *Excluding unfavorable currency, reported operating companies income
         down by 3.3%

  *Adjusted operating companies income, reflecting the items detailed in the
    attached Schedule 11, of $3.4 billion, down by 7.4%

       *Excluding unfavorable currency, adjusted operating companies income
         down by 3.4%

  *Reported operating income of $3.3 billion, down by 7.5%
  *Repurchased 16.7 million shares of the company’s common stock for $1.5
    billion

Six Months Year-to-Date 2013

  *Reported diluted earnings per share of $2.58, down by $0.02 or 0.8% versus
    $2.60 in 2012

       *Excluding unfavorable currency of $0.14, reported diluted earnings
         per share up by $0.12 or 4.6% versus $2.60 in 2012 as detailed in the
         attached Schedule 17

  *Adjusted diluted earnings per share of $2.59, down by $0.02 or 0.8% versus
    $2.61 in 2012

       *Excluding unfavorable currency of $0.14, adjusted diluted earnings
         per share up by $0.12 or 4.6% versus $2.61 in 2012 as detailed in the
         attached Schedule 16

  *Cigarette shipment volume of 433.8 billion units, down by 5.1%

       *Cigarette shipment volume decrease of 2.4%, excluding the Philippines

  *Reported net revenues, excluding excise taxes, of $15.5 billion, down by
    0.4%

       *Excluding unfavorable currency, reported net revenues, excluding
         excise taxes, up by 1.8%

  *Reported operating companies income of $6.9 billion, down by 4.0%

       *Excluding unfavorable currency, reported operating companies income
         down by 0.2%

  *Adjusted operating companies income, reflecting the items detailed in the
    attached Schedule 15, of $6.9 billion, down by 4.1%

       *Excluding unfavorable currency, adjusted operating companies income
         down by 0.3%

  *Reported operating income of $6.7 billion, down by 4.1%
  *Repurchased 33.4 million shares of the company’s common stock for $3.0
    billion

Full-Year 2013

  *PMI revises, for prevailing exchange rates only, its 2013 full-year
    reported diluted earnings per share forecast to be in a range of $5.43 to
    $5.53, versus $5.17 in 2012

       *Excluding an unfavorable currency impact, at prevailing exchange
         rates, of approximately $0.31 for the full-year 2013, reported
         diluted earnings per share are projected to increase by approximately
         10-12% versus adjusted diluted earnings per share of $5.22 in 2012,
         as detailed in the attached Schedule 20.

Philip Morris International Inc. (NYSE / Euronext Paris: PM) today announced
its 2013 second-quarter results.

“As expected, despite strong pricing and a robust share performance, our
second-quarter results were primarily impacted by lower industry volume in
several key markets, as well as the timing of inventory movements in Japan,
higher costs, predominantly in Asia, and stiffer currency headwinds,” said
André Calantzopoulos, Chief Executive Officer.

“For the second half of the year, we expect volume/mix to improve, pricing to
remain strong and our total cost variance, excluding currency, to be flat.
While industry volume remains a challenge, our underlying business performance
is such that we continue to expect to meet our mid to long-term
currency-neutral adjusted diluted EPS growth rate target of 10-12% in 2013.”

Conference Call

A conference call, hosted by Jacek Olczak, Chief Financial Officer, with
members of the investor community and news media, will be webcast at 9:00
a.m., Eastern Time, on July 18, 2013. Access is available at
www.pmi.com/webcasts.

Dividends and Share Repurchase Program

During the quarter, PMI declared a regular quarterly dividend of $0.85,
representing an annualized rate of $3.40 per common share, and spent $1.5
billion to repurchase 16.7 million shares, as shown in the table below.

Current $18 Billion, Three-Year Program
                       Value      Shares
                         ($ Mio.)     000
August-December 2012     2,853        32,206
January-March 2013       1,500        16,685
April-June 2013          1,545        16,665
Total Under Program      5,898        65,556
                                      

Since May 2008, when PMI began its first share repurchase program, the company
has spent an aggregate of $30.9 billion to repurchase 522.3 million shares at
an average price of $59.15 per share, or 24.8% of the shares outstanding at
the time of the spin-off in March 2008.

Acquisitions and Agreements

During the quarter, PMI announced that Grupo Carso, S.A.B. de C. V. (“Grupo
Carso”) will sell to PMI its 20% interest in PMI’s Mexican tobacco business.
The final purchase price, estimated to be approximately $700 million, will be
determined by a pre-agreed formula. It is subject to a potential adjustment
based on the actual performance of the Mexican tobacco business over the
three-year period ending two fiscal years after the closing of the purchase.
The transaction, as a result of which PMI will own 100% of its Mexican
business, is expected to be completed by September 30, 2013, subject to the
approval of the Mexican antitrust authority, and is projected to be marginally
accretive to PMI’s earnings per share as of the fourth quarter of 2013.

2013 Full-Year Forecast

PMI revises, for prevailing exchange rates only, its 2013 full-year reported
diluted earnings per share forecast to be in a range of $5.43 to $5.53, versus
$5.17 in 2012.

Excluding an unfavorable currency impact, at prevailing exchange rates, of
approximately $0.31 for the full-year 2013, reported diluted earnings per
share are projected to increase by approximately 10-12% versus adjusted
diluted earnings per share of $5.22 in 2012, as detailed in the attached
Schedule 20, unchanged from the constant-currency earnings per share forecast
disclosed on May 14, 2013.

This forecast includes a one-year gross productivity and cost savings target
for 2013 of approximately $300 million and a share repurchase target for 2013
of $6.0 billion.

This forecast excludes the impact of any potential future acquisitions,
unanticipated asset impairment and exit cost charges, future changes in
currency exchange rates and any unusual events.

The factors described in the Forward-Looking and Cautionary Statements section
of this release represent continuing risks to these projections.

                   2013 SECOND-QUARTER CONSOLIDATED RESULTS

In this press release, “PMI” refers to Philip Morris International Inc. and
its subsidiaries. References to total international cigarette market, defined
as worldwide cigarette volume excluding the United States,total cigarette
market, total market and market shares are PMI estimates based on the latest
available data from a number of internal and external sources and may, in
defined instances, exclude the People’s Republic of China and/or PMI’s
duty-free business. The term “net revenues” refers to operating revenues from
the sale of our products, excluding excise taxes and net of sales and
promotion incentives. Operating companies income, or “OCI,” is defined as
operating income before general corporate expenses and the amortization of
intangibles. PMI’s management evaluates business segment performance and
allocates resources based on OCI. Management also reviews OCI, OCI margins and
earnings per share, or “EPS,” on an adjusted basis (which may exclude the
impact of currency and other items such as acquisitions, asset impairment and
exit costs, discrete tax items and unusual items), earnings before interest,
taxes, depreciation, and amortization, or “EBITDA,” free cash flow, defined as
net cash provided by operating activities less capital expenditures, and net
debt. PMI believes it is appropriate to disclose these measures as they
improve comparability and help investors analyze business performance and
trends. Non-GAAP measures used in this release should be considered neither in
isolation nor as a substitute for the financial measures prepared in
accordance with U.S. GAAP. Comparisons are to the same prior-year period
unless otherwise stated. For a reconciliation of non-GAAP measures to
corresponding GAAP measures, see the relevant schedules provided with this
release.

                                 NET REVENUES

          PMI Net Revenues ($ Millions)                                
             Second-Quarter                        Six Months Year-To-Date
                                     Excl.                                   Excl.
             2013     2012     Change   Curr.      2013      2012      Change   Curr.
European     $2,206   $2,285   (3.5)%   (2.4)%     $4,176    $4,338    (3.7)%   (3.8)%
Union
Eastern
Europe,
Middle       2,181    2,151    1.4%     3.7%       4,224     3,986     6.0%     6.9%
East &
Africa
Asia         2,692    2,855    (5.7)%   (0.8)%     5,482     5,632     (2.7)%   2.0%
Latin
America      838      829      1.1%     4.5%       1,619     1,612     0.4%     3.3%
& Canada
Total        $7,917   $8,120   (2.5)%   0.5%       $15,501   $15,568   (0.4)%   1.8%
PMI
                                                                                

Net revenues of $7.9 billion were down by 2.5%, including unfavorable currency
of $243 million. Excluding currency, net revenues increased by 0.5%, driven by
favorable pricing of $499 million across all Regions, partially offset by
unfavorable volume/mix of $459 million.

                          OPERATING COMPANIES INCOME

          PMI Operating Companies Income ($                               
             Millions)
             Second-Quarter                         Six Months Year-To-Date
                                      Excl.                                        Excl.
             2013     2012     Change    Curr.      2013       2012       Change      Curr.
European     $1,082   $1,117   (3.1)%    (3.3)%     $2,020     $2,147     (5.9)%      (5.4)%
Union
Eastern
Europe,
Middle       945      948      (0.3)%    2.6%       1,880      1,758      6.9%        8.7%
East &
Africa
Asia         1,128    1,364    (17.3)%   (9.1)%     2,470      2,771      (10.9)%     (3.1)%
Latin
America      255      249      2.4%      5.6%       509        486        4.7%        7.2%
& Canada
Total        $3,410   $3,678   (7.3)%    (3.3)%     $6,879     $7,162     (4.0)%      (0.2)%
PMI
                                                                                      

Reported operating companies income of $3.4 billion was down by 7.3%,
including unfavorable currency of $146 million. Excluding currency, operating
companies income decreased by 3.3%, due to unfavorable volume/mix of $386
million, primarily in Japan, the Philippines and Russia, and higher costs,
principally related to manufacturing in Indonesia, brand support in the
Philippines, and the annualization of business infrastructure investments in
Russia, partly offset by favorable pricing.

Adjusted operating companies income decreased by 7.4% as shown in the table
below and detailed in Schedule 11. Adjusted operating companies income,
excluding unfavorable currency, decreased by 3.4%.

PMI Operating Companies Income ($ Millions)
                                                            
                   Second-Quarter                  Six Months Year-To-Date
                   2013       2012     Change      2013       2012     Change
Reported OCI       $3,410     $3,678   (7.3)%      $6,879     $7,162   (4.0)%
Asset
impairment &       (5)        (8)                  (8)        (16)
exit costs
Adjusted OCI       $3,415     $3,686   (7.4)%      $6,887     $7,178   (4.1)%
Adjusted OCI       43.1%      45.4%    (2.3)       44.4%      46.1%    (1.7)
Margin*                                p.p.                            p.p.

 *Margins are calculated as adjusted OCI, divided by net revenues, excluding
                                excise taxes.

Adjusted operating companies income margin, excluding unfavorable currency,
decreased by 1.8 points to 43.6%, as detailed in Schedule 11, primarily
reflecting unfavorable volume/mix and higher costs.

                        SHIPMENT VOLUME & MARKET SHARE

PMI Cigarette Shipment Volume (Million Units)
                                                               
                     Second-Quarter                 Six Months Year-To-Date
                     2013      2012      Change     2013      2012      Change
European Union       48,723    51,804    (5.9)%     91,690    99,593    (7.9)%
Eastern Europe,
Middle East &        76,298    79,156    (3.6)%     143,132   145,084   (1.3)%
Africa
Asia                 80,588    83,472    (3.5)%     153,207   164,502   (6.9)%
Latin America &      23,290    23,864    (2.4)%     45,817    48,207    (5.0)%
Canada
Total PMI            228,899   238,296   (3.9)%     433,846   457,386   (5.1)%
                                                                        

2013 Second-Quarter

PMI’s cigarette shipment volume of 228.9 billion units decreased by 3.9%, or
9.4 billion units, due principally to a total industry volume decline,
partially offset by a slight gain in market share excluding China. The
decrease in PMI’s cigarette shipment volume mainly reflected: in the EU, the
unfavorable impact of excise tax-driven price increases, the weak economic and
employment environment, the share growth of the other tobacco products (OTP)
category, and the increased prevalence of illicit trade; in EEMA, the impact
of tax-driven price increases and the reversal of favorable distributor
inventory movements in Russia in the first quarter of 2013, and in Turkey, the
renewed growth in illicit trade, partly offset by the Middle East and North
Africa; in Asia, the unfavorable impact of the disruptive January 2013 excise
tax increase in the Philippines and the timing of inventory movements in
Japan, partly offset by Indonesia; in Latin America & Canada, a lower total
market in Argentina and Brazil, partly offset by Mexico. Excluding the
Philippines, PMI’s cigarette shipment volume decreased by 2.6%.

Total cigarette shipments of Marlboro of 72.4 billion units decreased by 5.9%,
due primarily to declines in: the EU, notably France, the Netherlands, Poland
and the United Kingdom, partly offset by Germany and Italy; EEMA, primarily
Russia and Ukraine, partly offset by the Middle East and North Africa; Asia,
predominantly Japan and the Philippines; and Latin America & Canada, mainly
Argentina and Brazil, partly offset by Mexico. Excluding the Philippines,
total cigarette shipments of Marlboro decreased by 3.9%.

Total cigarette shipments of L&M of 25.1 billion units increased by 6.1%,
driven notably by Egypt, partly offset by Algeria and Turkey. Total cigarette
shipments of Bond Street of 11.6 billion units decreased by 8.9%, due
predominantly to Russia and Ukraine. Total cigarette shipments of Philip
Morris of 8.8 billion units decreased by 8.5%, due primarily to Italy and the
Philippines. Total cigarette shipments of Parliament of 11.5 billion units
increased by 4.0%, driven by Korea and Turkey. Total cigarette shipments of
Chesterfield of 8.9 billion units decreased by 7.9%, due primarily to Russia
and Ukraine, partly offset by Germany. Total cigarette shipments of Lark of
7.9 billion units decreased by 7.9%, due predominantly to Turkey.

Total shipment volume of OTP, in cigarette equivalent units, increased by
3.0%. Total shipment volume for cigarettes and OTP, in cigarette equivalent
units, decreased by 3.7%.

PMI’s market share increased in a number of key markets, including Algeria,
Argentina, Belgium, Canada, Egypt, France, Germany, Indonesia, Italy, Korea,
the Netherlands, Portugal, Saudi Arabia, Spain, Ukraine, and the United
Kingdom.

                          EUROPEAN UNION REGION (EU)

2013 Second-Quarter

Net revenues of $2.2 billion decreased by 3.5%. Excluding unfavorable currency
of $25 million, net revenues decreased by 2.4%, due to unfavorable volume/mix
of $131 million, largely reflecting a lower total market, notably in France,
Germany and Poland, partly offset by favorable pricing of $77 million, driven
mainly by France and Spain.

Operating companies income of $1.1 billion decreased by 3.1%, including
favorable currency of $2 million. Excluding currency, operating companies
income decreased by 3.3%, principally reflecting unfavorable volume/mix of
$114 million, partially offset by favorable pricing.

Adjusted operating companies income decreased by 3.1%, as shown in the table
below and detailed on Schedule 11. Adjusted operating companies income,
excluding favorable currency, decreased by 3.3%.

EU Operating Companies Income ($ Millions)
                                                            
                   Second-Quarter                  Six Months Year-To-Date
                   2013       2012     Change      2013       2012     Change
Reported OCI       $1,082     $1,117   (3.1)%      $2,020     $2,147   (5.9)%
Asset
impairment &       0          0                    0          0
exit costs
Adjusted OCI       $1,082     $1,117   (3.1)%      $2,020     $2,147   (5.9)%
Adjusted OCI       49.0%      48.9%    0.1         48.4%      49.5%    (1.1)
Margin*                                p.p.                            p.p.

 *Margins are calculated as adjusted OCI, divided by net revenues, excluding
                                excise taxes.

Adjusted operating companies income margin, excluding favorable currency,
decreased by 0.5 points to 48.4%, as detailed on Schedule 11, primarily as a
result of unfavorable volume/mix.

The total cigarette market in the EU of 121.6 billion units decreased by 8.0%,
due primarily to tax-driven price increases, the unfavorable economic and
employment environment, particularly in southern Europe, and the increased
prevalence of illicit trade. The total OTP market in the EU of 41.0 billion
cigarette equivalent units decreased by 0.4%, reflecting a lower total fine
cut market, down by 0.8% to 35.7 billion cigarette equivalent units.

Although PMI’s cigarette shipment volume of 48.7 billion units decreased by
5.9%, due principally to a lower total market across the Region, PMI’s market
share increased by 0.7 points to 39.3%. On a June year-to-date basis, PMI’s
market share increased by 0.7 points to 38.7%. While shipment volume of
Marlboro of 23.9 billion units in the quarter decreased by 3.2%, mainly due to
a lower total market, market share increased by 0.5 points to 19.4%. Despite a
shipment volume decrease for L&M of 4.8% to 8.5 billion units, market share
increased by 0.3 points to 6.9%. Shipment volume of Chesterfield of 4.9
billion units increased by 2.9% and market share increased by 0.2 points to
4.0%, driven by gains, notably in Austria, the Czech Republic, Portugal, Spain
and the United Kingdom, partly offset by Germany. Although shipment volume of
Philip Morris of 2.5 billion units decreased by 8.4%, market share increased
by 0.3 points to 2.0%, with gains notably in France, Italy and Portugal.

PMI’s shipments of OTP of 5.5 billion cigarette equivalent units increased by
3.2%, driven by higher share. PMI’s OTP total market share was 13.4%, up by
0.9 points, driven by gains in the fine cut category, notably in France, up by
2.3 points to 27.3%, Hungary, up by 4.5 points to 10.7%, Italy, up by 7.9
points to 37.9%, Poland, up by 1.9 points to 20.8%, and Spain, up by 1.1
points to 12.7%.

EU Key Market Commentaries

In France, the total cigarette market of 12.3 billion units decreased by 9.1%,
mainly reflecting the unfavorable impact of price increases in the fourth
quarter of 2012, an increase in illicit trade, growth of the OTP category, and
a weakening economy. Although PMI’s shipments of 5.0 billion units decreased
by 9.2%, market share increased by 0.5 points to 40.5%, mainly driven by the
resilience of premium Philip Morris,  up by 0.8 points to 9.1%, and the growth
of Chesterfield,  up by 0.1 point to 3.4%. Market shares of Marlboro and L&M
decreased by 0.2 points each to 25.0% and 2.5%, respectively. The total
industry fine cut category of 3.6 billion cigarette equivalent units increased
by 2.9%. PMI’s market share of the category increased by 2.3 points to 27.3%.

In Germany, the total cigarette market of 19.7 billion units decreased by
7.0%, mainly reflecting the reversal of trade purchases of competitive
products made in the first quarter of 2013. The underlying total market is
estimated to have declined by 2.8%. Although PMI’s shipments of 7.4 billion
units decreased by 3.9%, market share increased by 1.2 points to 37.6%, driven
by Marlboro, up by 1.5 points to 23.3%, and L&M, up by 0.3 points to 10.8%,
partly offset by Chesterfield, down by 0.6 points to 1.7%. The total industry
fine cut category of 10.4 billion cigarette equivalent units decreased by
0.7%. PMI’s market share of the category was down by 0.3 points to 14.9%.

In Italy, the total cigarette market of 18.7 billion units decreased by 7.2%,
reflecting an unfavorable economic and employment environment and an increase
in illicit trade. Although PMI’s shipments of 10.6 billion units decreased by
2.4%, market share increased by 0.4 points to 53.3%, with Marlboro up by 0.4
points to 25.8%. Market share of Philip Morris increased by 1.1 points to
2.3%, benefiting from the 2012 launch of Philip Morris Selection in the
low-price segment, and share of Chesterfield was flat at 3.5%, partially
offset by Diana in the low-price segment, down by 0.8 points to 11.6%,
impacted by the availability of non-duty paid products. The total industry
fine cut category of 1.5 billion cigarette equivalent units decreased by
10.5%, reflecting the 2012 excise tax-driven reduction of the price gap
differential with cigarettes. PMI’s market share of the category increased by
7.9 points to 37.9%, driven by Marlboro Red and Gold fine cut.

In Poland, the total cigarette market of 11.9 billion units decreased by
13.4%, mainly reflecting the reversal of trade purchases of competitive
products made in the first quarter of 2013, and the increased availability of
non-duty paid OTP products. PMI’s shipments of 4.4 billion units decreased by
13.8%. Although PMI’s market share decreased by 0.2 points to 36.7%, share of
Marlboro and L&M increased by 0.6 and 1.2 points to 11.8% and 17.5%,
respectively. Market share of Chesterfield decreased by 0.1 point to 2.0%.
Although the total industry fine cut category of 0.9 billion cigarette
equivalent units decreased by 9.1%, reflecting the prevalence of non-duty paid
OTP products, PMI’s market share of the category increased by 1.9 points to
20.8%.

In Spain, the total cigarette market of 12.4 billion units decreased by 9.1%,
mainly reflecting the impact of price increases in 2012 and the first quarter
of 2013, the unfavorable economic and employment environment, the growth of
the OTP category, and illicit trade. PMI’s shipments of 4.3 billion units
decreased by 0.4%. PMI’s market share increased by 2.3 points to 31.9%, driven
by higher share of Marlboro, L&M and Chesterfield, up by 0.9, 0.5 and 0.8
points to 14.8%, 6.6% and 9.7%, respectively. Market share of Philip Morris
was flat at 0.7%. The total industry fine cut category of 3.1 billion
cigarette equivalent units increased by 15.1%. PMI’s market share of the
category increased by 1.1 points to 12.7%.

              EASTERN EUROPE, MIDDLE EAST & AFRICA REGION (EEMA)

2013 Second-Quarter

Net revenues of $2.2 billion increased by 1.4%. Excluding unfavorable currency
of $49 million, net revenues increased by 3.7%, driven by favorable pricing of
$176 million, principally in Russia, Turkey and Ukraine, partly offset by
unfavorable volume/mix of $97 million, mainly due to Russia and Ukraine.

Operating companies income of $945 million decreased by 0.3%. Excluding
unfavorable currency of $28 million, operating companies income increased by
2.6%, due primarily to higher pricing, partly offset by unfavorable volume/mix
of $68 million and higher costs, principally related to the annualization of
investments in business infrastructure in Russia.

Adjusted operating companies income decreased by 0.3%, as shown in the table
below and detailed on Schedule 11. Adjusted operating companies income,
excluding unfavorable currency, increased by 2.6%.

EEMA Operating Companies Income ($ Millions)
                                                             
                      Second-Quarter                Six Months Year-To-Date
                      2013      2012    Change      2013       2012     Change
Reported OCI          $945      $948    (0.3)%      $1,880     $1,758   6.9%
Asset impairment      0         0                   0          0
& exit costs
Adjusted OCI          $945      $948    (0.3)%      $1,880     $1,758   6.9%
Adjusted OCI          43.3%     44.1%   (0.8)       44.5%      44.1%    0.4
Margin*                                 p.p.                            p.p.

 *Margins are calculated as adjusted OCI, divided by net revenues, excluding
                                excise taxes.

Adjusted operating companies income margin, excluding unfavorable currency,
decreased by 0.5 points to 43.6%, as detailed on Schedule 11.

PMI’s cigarette shipment volume of 76.3 billion units decreased by 3.6%,
mainly due to Russia and Turkey, partly offset by the Middle East and North
Africa.

PMI’s cigarette shipment volume of premium brands decreased by 1.8%, due
principally to Marlboro, down by 4.1% to 21.0 billion units, partly offset by
Parliament, up by 4.0% to 8.4 billion units.

EEMA Key Market Commentaries

In Russia, PMI’s shipment volume of 23.0 billion units decreased by 11.4%,
mainly due to the impact of tax-driven price increases and the reversal of
favorable distributor inventory movements in the first quarter of 2013, and
the weakening of the economy. Shipment volume of PMI’s premium portfolio
decreased by 10.6%, mainly due to Marlboro, down by 31.5%, partly offset by
Parliament, up by 1.1%. In the mid-price segment, shipment volume decreased by
14.1%, mainly due to Chesterfield, down by 21.6%, partially offset by L&M, up
by 2.7%. In the low-price segment, shipment volume decreased by 10.4%, mainly
due to Bond Street, Optima and Apollo Soyuz, down by 10.1%, 17.3% and 20.0%,
respectively, partially offset by Next, up by 2.2%. PMI’s May quarter-to-date
market share of 25.9%, as measured by Nielsen, was down by 0.2 points,
reflecting the unfavorable impact of the timing of competitive brand price
increases at retail. Market share of Parliament increased by 0.2 points to
3.3%, Marlboro decreased by 0.2 points to 1.7%, L&M increased by 0.2 points to
2.7%, Chesterfield decreased by 0.4 points to 3.0%, Bond Street increased by
0.2 points to 6.5%, and Next increased by 0.2 points to 3.1%.

In Turkey, the total cigarette market of 22.8 billion units decreased by an
estimated 11%, primarily reflecting the renewed growth of illicit trade. PMI’s
shipment volume of 11.7 billion units decreased by 7.7%. PMI’s May
quarter-to-date market share, as measured by Nielsen, decreased by 0.5 points
to 44.8%, mainly due to low-price L&M, down by 1.0 point to 7.6%, and
Marlboro, down by 0.3 points to 8.7%, partly offset by premium Parliament and 
mid-price Muratti,  up by 0.9 and 0.4 points to 9.6% and 7.0%, respectively.

In Ukraine, the total cigarette market of 20.7 billion units decreased by an
estimated 10%, reflecting the impact of tax-driven price increases in the
first quarter of 2013 and an increase in illicit trade. Although PMI’s
shipment volume of 6.8 billion units decreased by 9.3%, PMI’s May
quarter-to-date market share, as measured by Nielsen, increased by 1.3 points
to 33.5%, mainly due to growth from PMI’s low-price segment brands of Bond
Street, Optima and President. Share for premium Parliament increased by 0.1
point to 3.3%. Share of Marlboro decreased by 0.3 points to 5.6%.

                                 ASIA REGION

2013 Second-Quarter

Net revenues of $2.7 billion decreased by 5.7%, including unfavorable currency
of $141 million. Excluding currency, net revenues decreased by 0.8%, due to
unfavorable volume/mix of $211 million, primarily in Japan and the
Philippines, partially offset by favorable pricing of $189 million,
principally in Australia, Indonesia and the Philippines.

Operating companies income of $1.1 billion decreased by 17.3%, including
unfavorable currency of $112 million. Excluding currency, operating companies
income decreased by 9.1%, due primarily to unfavorable volume/mix of $180
million, higher manufacturing costs, principally in Indonesia, and increased
brand support in the Philippines, partly offset by favorable pricing.

Adjusted operating companies income decreased by 16.9% as shown in the table
below and detailed on Schedule 11. Adjusted operating companies income,
excluding unfavorable currency, decreased by 8.7%.

Asia Operating Companies Income ($ Millions)
                                                           
                 Second-Quarter                   Six Months Year-To-Date
                 2013       2012     Change       2013       2012     Change
Reported OCI     $1,128     $1,364   (17.3)%      $2,470     $2,771   (10.9)%
Asset
impairment &     (5)        0                     (8)        0
exit costs
Adjusted OCI     $1,133     $1,364   (16.9)%      $2,478     $2,771   (10.6)%
Adjusted OCI     42.1%      47.8%    (5.7)        45.2%      49.2%    (4.0)
Margin*                              p.p.                             p.p.

 *Margins are calculated as adjusted OCI, divided by net revenues, excluding
                                excise taxes.

Adjusted operating companies income margin, excluding unfavorable currency,
decreased by 3.9 points to 43.9%, as detailed on Schedule 11, primarily
reflecting the impact of unfavorable volume/mix and higher costs.

PMI’s cigarette shipment volume of 80.6 billion units decreased by 3.5%, due
primarily to the decrease in the Philippines. Excluding the Philippines, PMI’s
cigarette shipment volume increased by 1.5%, driven mainly by Indonesia.

Shipment volume of Marlboro of 18.4 billion units decreased by 12.7%, or by
6.1% excluding the Philippines, due mainly to the timing of inventory
movements in Japan.

Asia Key Market Commentaries

In Indonesia, the total cigarette market of 78.3 billion units increased by
3.5%. The total cigarette market is estimated to increase by approximately 4%
for the full-year 2013. PMI’s shipment volume in the quarter of 28.2 billion
units increased by 6.0%. PMI’s market share increased by 0.9 points to 36.1%,
driven notably by machine-made, low-tar low-nicotine (LTLN) Sampoerna A in the
premium segment, up by 0.3 points to 14.0%, and machine-made, LTLN mid-price U
Mild, up by 1.3 points to 4.3%. Market share of the hand-rolled, full-flavor
Dji Sam Soe in the premium segment decreased by 1.0 point to 6.8%. Marlboro’s
market share increased by 0.7 points to 5.4% and its share of the “white”
cigarettes segment, representing 7.1% of the total cigarette market, increased
by 5.9 points to 76.2%.

In Japan, the total cigarette market of 48.4 billion units decreased by 2.0%.
PMI’s shipment volume of 14.1 billion units decreased by 10.2%, principally
due to the timing of inventory movements. PMI’s market share decreased by 0.9
points to 26.9%, reflecting continued significant product introductions and
promotional activities by PMI’s principal competitor. Although resilient since
the beginning of the year, Marlboro’s market share decreased by 0.3 points to
12.2% in the quarter. Share of Lark and Philip Morris in the quarter decreased
by 0.3 and 0.1 points to 8.1% and 2.2%, respectively, partially offset by
Virginia S., up by  0.1 point to 2.1%.

In Korea, the total cigarette market of 22.0 billion units decreased by 3.5%.
Although PMI’s shipment volume of 4.3 billion units decreased by 0.4%, market
share increased by 0.7 points to 19.5%, reflecting continued stabilization
since PMI’s price increases of February 2012. Market share of Marlboro,
Parliament and Virginia S. in the quarter increased by 0.1, 0.8 and 0.1 points
to 7.8%, 7.0% and 4.1%, respectively.

In the Philippines, PMI’s shipment volume of 19.1 billion units decreased by
16.5%, primarily reflecting the unfavorable impact of the disruptive excise
tax increase in January 2013, which resulted in a recommended retail selling
price increase for premium Marlboro and low-price Fortune of approximately 60%
and 70%, respectively. Industry cigarette volume of 23.1 billion units was
estimated to have decreased by 7.0%, reflecting a partial, but insufficient,
improvement in declared tax-paid volume by local manufacturers and government
tax enforcement. PMI’s market share in the quarter decreased by 9.5 points to
82.9%, primarily due to down-trading to competitive brands. Marlboro’s market
share decreased by 5.9 points to 14.7%. Share of low-price Fortune decreased
by 18.0 points to 32.8%, partly offset by gains from PMI’s other local
low-price brands. PMI’s cigarette shipments are estimated to decline by 20-25%
for the full-year 2013, as the availability of non-tax paid domestic volume
remains a critical issue.

                        LATIN AMERICA & CANADA REGION

2013 Second-Quarter

Net revenues of $838 million increased by 1.1%, including unfavorable currency
of $28 million. Excluding currency, net revenues increased by 4.5%, driven by
favorable pricing of $57 million, principally in Argentina, Brazil, Canada and
Mexico, partially offset by unfavorable volume/mix of $20 million.

Operating companies income of $255 million increased by 2.4%, including
unfavorable currency of $8 million. Excluding currency, operating companies
income increased by 5.6%, primarily driven by favorable pricing, partially
offset by unfavorable volume/mix of $24 million.

Adjusted operating companies income decreased by 0.8% as shown in the table
below and detailed on Schedule 11. Adjusted operating companies income,
excluding unfavorable currency, increased by 2.3%.

Latin America & Canada Operating Companies Income ($ Millions)
                                                           
                      Second-Quarter                Six Months Year-To-Date
                      2013      2012    Change      2013      2012    Change
Reported OCI          $255      $249    2.4%        $509      $486    4.7%
Asset impairment      0         (8)                 0         (16)
& exit costs
Adjusted OCI          $255      $257    (0.8)%      $509      $502    1.4%
Adjusted OCI          30.4%     31.0%   (0.6)       31.4%     31.1%   0.3 p.p.
Margin*                                 p.p.

 *Margins are calculated as adjusted OCI, divided by net revenues, excluding
                                excise taxes.

Adjusted operating companies income margin, excluding unfavorable currency,
decreased by 0.6 points to 30.4%, as detailed on Schedule 11.

PMI’s cigarette shipment volume of 23.3 billion units decreased  by 2.4%,
principally due to a lower total market in Brazil following the May 2012 and
January 2013 tax-driven price increases and a lower total market in Argentina,
partly offset by a higher total market in Mexico. Shipment volume of Marlboro
of 9.1 billion units decreased by 1.5%, mainly reflecting a lower total market
in Argentina and Brazil.

Latin America & Canada Key Market Commentaries

In Argentina, the total cigarette market of 10.1 billion units decreased by
4.7%, largely due to the weakening of the economy. PMI’s cigarette shipment
volume of 7.6 billion units decreased by 3.9%. PMI’s market share increased by
0.5 points to 75.2%, driven by mid-price Philip Morris, up by 1.6 points to
40.9%, partly offset by low-price Next, down by  0.4 points to 2.8%. Share of
Marlboro decreased by 0.1 point to 23.8%.

In Canada, the total tax-paid cigarette market of 7.5 billion units decreased
by 0.5%. PMI’s cigarette shipment volume of 2.8 billion units increased by
1.4% and market share increased by 0.1 point to 37.4%, with premium brands
Benson & Hedges and Belmont up by 0.1 and 0.2 points to 2.5% and 2.6%,
respectively, and low-price brand Next up by 1.8 points to 9.7%, partly offset
by mid-price Number 7 and low-price Accord, down by 0.3 and 0.4 points, to
4.3% and 3.0%, respectively. Market share of mid-price Canadian Classics was
flat at 10.1%.

In Mexico, the total cigarette market of 8.3 billion units increased by 6.1%,
primarily reflecting additional selling days in the quarter. PMI’s cigarette
shipment volume of 6.0 billion units increased by 5.6%. PMI’s market share
decreased by 0.4 points to 72.6%, reflecting unfavorable segment mix. Share of
premium Marlboro and Benson & Hedges decreased by 1.7 and 0.8 share points to
51.5% and 5.6%, respectively, partly offset by market share of low-price
Delicados, the second best-selling brand in the market, up by 1.1 points to
11.2%, and gains from PMI’s other local low-price brands.

Philip Morris International Inc. Profile

Philip Morris International Inc. (PMI) is the leading international tobacco
company, with seven of the world’s top 15 international brands, including
Marlboro, the number one cigarette brand worldwide. PMI’s products are sold in
more than 180 markets. In 2012, the company held an estimated 16.3% share of
the total international cigarette market outside of the U.S., or 28.8%
excluding the People’s Republic of China and the U.S. For more information,
see www.pmi.com.

Forward-Looking and Cautionary Statements

This press release contains projections of future results and other
forward-looking statements. Achievement of projected results is subject to
risks, uncertainties and inaccurate assumptions. In the event that risks or
uncertainties materialize, or underlying assumptions prove inaccurate, actual
results could vary materially from those contained in such forward-looking
statements. Pursuant to the “safe harbor” provisions of the Private Securities
Litigation Reform Act of 1995, PMI is identifying important factors that,
individually or in the aggregate, could cause actual results and outcomes to
differ materially from those contained in any forward-looking statements made
by PMI.

PMI’s business risks include: significant increases in cigarette-related
taxes; the imposition of discriminatory excise tax structures; fluctuations in
customer inventory levels due to increases in product taxes and prices;
increasing marketing and regulatory restrictions, often with the goal of
reducing or preventing the use of tobacco products; health concerns relating
to the use of tobacco products and exposure to environmental tobacco smoke;
litigation related to tobacco use; intense competition; the effects of global
and individual country economic, regulatory and political developments;
changes in adult smoker behavior; lost revenues as a result of counterfeiting,
contraband and cross-border purchases; governmental investigations;
unfavorable currency exchange rates and currency devaluations; adverse changes
in applicable corporate tax laws; adverse changes in the cost and quality of
tobacco and other agricultural products and raw materials; and the integrity
of its information systems. PMI’s future profitability may also be adversely
affected should it be unsuccessful in its attempts to produce products with
the potential to reduce the risk of smoking-related diseases; if it is unable
to successfully introduce new products, promote brand equity, enter new
markets or improve its margins through increased prices and productivity
gains; if it is unable to expand its brand portfolio internally or through
acquisitions and the development of strategic business relationships; or if it
is unable to attract and retain the best global talent.

PMI is further subject to other risks detailed from time to time in its
publicly filed documents, including the Form 10-Q for the quarter ended March
31, 2013. PMI cautions that the foregoing list of important factors is not a
complete discussion of all potential risks and uncertainties. PMI does not
undertake to update any forward-looking statement that it may make from time
to time, except in the normal course of its public disclosure obligations.


Schedule 1
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Condensed Statements of Earnings
For the Quarters Ended June 30,
($ in millions, except per share data)
(Unaudited)
                                                                
                                          2013         2012         % Change
Net revenues                              $  20,483     $ 20,037   2.2    %
Cost of sales                                2,701          2,666     1.3    %
Excise taxes on products ^(1)               12,566      11,917    5.4    %
Gross profit                                 5,216          5,454     (4.4 ) %
Marketing, administration and                1,801          1,768
research costs
Asset impairment and exit costs             5           8
Operating companies income                   3,410          3,678     (7.3 ) %
Amortization of intangibles                  24             25
General corporate expenses                  54          49
Operating income                             3,332          3,604     (7.5 ) %
Interest expense, net                       246         209
Earnings before income taxes                 3,086          3,395     (9.1 ) %
Provision for income taxes                  892         988       (9.7 ) %
Net earnings                                 2,194          2,407     (8.8 ) %
Net earnings attributable to                70          90
noncontrolling interests
Net earnings attributable to PMI          $  2,124      $ 2,317     (8.3 ) %
                                                                             
Per share data:^(2)
Basic earnings per share                  $  1.30       $ 1.36      (4.4 ) %
Diluted earnings per share                $  1.30       $ 1.36      (4.4 ) %
                                                                             

(1) The segment detail of excise taxes on products sold for the quarters ended
June 30, 2013 and 2012 is shown on Schedule 2.

(2) Net earnings and weighted-average shares used in the basic and diluted
earnings per share computations for the quarters ended June 30, 2013 and 2012
are shown on Schedule 4, Footnote 1.

                                                                          
                                                                                  Schedule 2
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Selected Financial Data by Business Segment
For the Quarters Ended June 30,
($ in millions)
(Unaudited)
                                                                                  
                            Net Revenues excluding Excise Taxes
                            European                                 Latin
                            Union        EEMA        Asia         America     Total
                                                                     & Canada
                                                                                  
2013       Net Revenues     $ 7,245       $ 5,377      $ 5,381       $ 2,480      $ 20,483
           ^(1)
           Excise Taxes      (5,039 )    (3,196 )   (2,689 )    (1,642 )   (12,566 )
           on Products
           Net Revenues
           excluding          2,206         2,181        2,692         838          7,917
           Excise Taxes
                                                                                  
2012       Net Revenues     $ 7,280       $ 5,062      $ 5,317       $ 2,378      $ 20,037
           Excise Taxes      (4,995 )    (2,911 )   (2,462 )    (1,549 )   (11,917 )
           on Products
           Net Revenues
           excluding          2,285         2,151        2,855         829          8,120
           Excise Taxes
                                                                                  
Variance   Currency           (25    )      (49    )     (141   )      (28    )     (243    )
           Acquisitions       -             -            -             -            -
           Operations        (54    )    79        (22    )    37        40      
           Variance           (79    )      30           (163   )      9            (203    )
           Total
           Variance           (3.5   )%     1.4    %     (5.7   )%     1.1    %     (2.5    )%
           Total (%)
                                                                                  
           Variance
           excluding          (54    )      79           (22    )      37           40
           Currency
           Variance
           excluding          (2.4   )%     3.7    %     (0.8   )%     4.5    %     0.5     %
           Currency (%)
                                                                                  
           Variance
           excluding          (54    )      79           (22    )      37           40
           Currency &
           Acquisitions
           Variance
           excluding
           Currency &         (2.4   )%     3.7    %     (0.8   )%     4.5    %     0.5     %
           Acquisitions
           (%)
                                                                                  
                                                                                  
^(1) 2013 Currency
decreased net revenues
as follows:
           European         $ (87    )
           Union
           EEMA               (95    )
           Asia               (194   )
           Latin
           America &         (103   )
           Canada
                            $ (479   )
                                                                                  

                                                              
                                                                    Schedule 3
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Selected Financial Data by Business Segment
For the Quarters Ended June 30,
($ in millions)
(Unaudited)
                                                                    
                   Operating Companies Income
                                                          Latin
                    European    EEMA      Asia       America  Total
                    Union                                 &
                                                          Canada
2013                $ 1,082      $ 945       $ 1,128      $ 255     $ 3,410
2012                  1,117        948         1,364        249       3,678
% Change              (3.1  )%     (0.3 )%     (17.3 )%     2.4 %     (7.3  )%
                                                                    
Reconciliation:
For the quarter
ended June 30,      $ 1,117      $ 948       $ 1,364      $ 249     $ 3,678
2012
                                                                    
2012 Asset
impairment and        -            -           -            8         8
exit costs
2013 Asset
impairment and        -            -           (5    )      -         (5    )
exit costs
                                                                    
Acquired              -            -           -            -         -
businesses
Currency              2            (28  )      (112  )      (8  )     (146  )
Operations           (37   )    25       (119  )    6      (125  )
For the quarter
ended June 30,      $ 1,082    $ 945     $ 1,128    $ 255   $ 3,410 
2013
                                                                    


Schedule 4
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Diluted Earnings Per Share
For the Quarters Ended June 30,
($ in millions, except per share data)
(Unaudited)
                                                            
                                                                Diluted
                                                                E.P.S.
                                                                          
2013 Diluted Earnings Per Share                                 $ 1.30    ^(1)
2012 Diluted Earnings Per Share                                 $ 1.36    ^(1)
Change                                                          $ (0.06 )
% Change                                                          (4.4  ) %
                                                                          
Reconciliation:
2012 Diluted Earnings Per Share                                 $ 1.36    ^(1)
                                                                          
                                                                          
Special Items:
2012 Asset impairment and exit costs                              -
2012 Tax items                                                    -
2013 Asset impairment and exit costs                              -
2013 Tax items                                                    -
                                                                          
                                                                          
Currency                                                          (0.07 )
Interest                                                          (0.02 )
Change in tax rate                                                -
Impact of lower shares outstanding and                            0.06
share-based payments
Operations                                                       (0.03 )
2013 Diluted Earnings Per Share                                 $ 1.30   ^(1)
                                                                          
                                                                          
^(1) Basic and diluted EPS were calculated using the
following (in millions):
                                                                          
                                                    Q2          Q2

                                                    2013        2012
                                                                          
Net earnings attributable to PMI                    $  2,124    $ 2,317
Less distributed and undistributed earnings
attributable
to share-based payment awards                         11        12    
Net earnings for basic and diluted EPS              $  2,113    $ 2,305 
                                                               
Weighted-average shares for basic and diluted         1,631     1,701 
EPS
                                                                          


Schedule 5
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Condensed Statements of Earnings
For the Six Months Ended June 30,
($ in millions, except per share data)
(Unaudited)
                                                                 
                                                2013      2012      % Change
Net revenues                                    $ 39,010   $ 38,059   2.5    %
Cost of sales                                     5,190      5,108    1.6    %
Excise taxes on products ^(1)                    23,509   22,491   4.5    %
Gross profit                                      10,311     10,460   (1.4 ) %
Marketing, administration and research            3,424      3,282
costs
Asset impairment and exit costs                  8        16
Operating companies income                        6,879      7,162    (4.0 ) %
Amortization of intangibles                       48         49
General corporate expenses                       112      106
Operating income                                  6,719      7,007    (4.1 ) %
Interest expense, net                            482      422
Earnings before income taxes                      6,237      6,585    (5.3 ) %
Provision for income taxes                       1,825    1,946    (6.2 ) %
Net earnings                                      4,412      4,639    (4.9 ) %
Net earnings attributable to noncontrolling      163      161
interests
Net earnings attributable to PMI                $ 4,249   $ 4,478    (5.1 ) %
                                                                             
Per share data:^(2)
Basic earnings per share                        $ 2.58    $ 2.60     (0.8 ) %
Diluted earnings per share                      $ 2.58    $ 2.60     (0.8 ) %
                                                                             

(1) The segment detail of excise taxes on products sold for the six months
ended June 30, 2013 and 2012 is shown on Schedule 6.

(2)Net earnings and weighted-average shares used in the basic and diluted
earnings per share computations for the six months ended June 30, 2013 and
2012 are shown on Schedule 8, Footnote 1.

                                                                          
                                                                                 Schedule 6
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Selected Financial Data by Business Segment
For the Six Months Ended June 30,
($ in millions)
(Unaudited)
                                                                                 
                           Net Revenues excluding Excise Taxes
                           European                                 Latin
                           Union        EEMA        Asia         America     Total
                                                                    & Canada
                                                                                 
2013       Net Revenues    $ 13,768      $ 9,800      $ 10,632      $ 4,810      $ 39,010
           ^(1)
           Excise Taxes     (9,592 )    (5,576 )   (5,150 )    (3,191 )   (23,509 )
           on Products
           Net Revenues
           excluding         4,176         4,224        5,482         1,619        15,501
           Excise Taxes
                                                                                 
2012       Net Revenues    $ 13,750      $ 9,131      $ 10,494      $ 4,684      $ 38,059
           Excise Taxes     (9,412 )    (5,145 )   (4,862 )    (3,072 )   (22,491 )
           on Products
           Net Revenues
           excluding         4,338         3,986        5,632         1,612        15,568
           Excise Taxes
                                                                                 
Variance   Currency          2             (39    )     (262   )      (47    )     (346    )
           Acquisitions      -             -            -             -            -
           Operations       (164   )    277       112        54        279     
           Variance          (162   )      238          (150   )      7            (67     )
           Total
           Variance          (3.7   )%     6.0    %     (2.7   )%     0.4    %     (0.4    )%
           Total (%)
                                                                                 
           Variance
           excluding         (164   )      277          112           54           279
           Currency
           Variance
           excluding         (3.8   )%     6.9    %     2.0    %      3.3    %     1.8     %
           Currency (%)
                                                                                 
           Variance
           excluding         (164   )      277          112           54           279
           Currency &
           Acquisitions
           Variance
           excluding
           Currency &        (3.8   )%     6.9    %     2.0    %      3.3    %     1.8     %
           Acquisitions
           (%)
                                                                                 
                                                                                 
                                                                                 
^(1) 2013 Currency
increased (decreased) net
revenues as follows:
           European        $ 16
           Union
           EEMA              (56    )
           Asia              (356   )
           Latin
           America &        (189   )
           Canada
                           $ (585   )
                                                                                 


Schedule 7
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Selected Financial Data by Business Segment
For the Six Months Ended June 30,
($ in millions)
(Unaudited)
                                                                
                            Operating Companies Income
                             European                       Latin
                             Union     EEMA     Asia     America   Total
                                                            & Canada
2013                         $ 2,020    $ 1,880   $ 2,470   $ 509      $ 6,879
2012                         2,147      1,758     2,771     486        7,162
% Change                     (5.9)%     6.9%      (10.9)%   4.7%       (4.0)%
                                                                       
Reconciliation:
For the six months ended     $ 2,147    $ 1,758   $ 2,771   $ 486      $ 7,162
June 30, 2012
                                                                       
2012 Asset impairment        -          -         -         16         16
and exit costs
2013 Asset impairment        -          -         (8)       -          (8)
and exit costs
                                                                       
Acquired businesses          -          -         -         -          -
Currency                     (10)       (31)      (215)     (12)       (268)
Operations                   (117)     153      (78)     19        (23)
For the six months ended     $ 2,020   $ 1,880  $ 2,470  $ 509     $ 6,879
June 30, 2013
                                                                       


Schedule 8
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Diluted Earnings Per Share
For the Six Months Ended June 30,
($ in millions, except per share data)
(Unaudited)
                                                            
                                                                Diluted
                                                                E.P.S.
                                                                          
2013 Diluted Earnings Per Share                                 $ 2.58    ^(1)
2012 Diluted Earnings Per Share                                 $ 2.60    ^(1)
Change                                                          $ (0.02 )
% Change                                                          (0.8  ) %
                                                                          
Reconciliation:
2012 Diluted Earnings Per Share                                 $ 2.60    ^(1)
                                                                          
                                                                          
Special Items:
2012 Asset impairment and exit costs                              0.01
2012 Tax items                                                    -
2013 Asset impairment and exit costs                              -
2013 Tax items                                                    (0.01 )
                                                                          
                                                                          
Currency                                                          (0.14 )
Interest                                                          (0.03 )
Change in tax rate                                                0.01
Impact of lower shares outstanding and                            0.11
share-based payments
Operations                                                       0.03  
2013 Diluted Earnings Per Share                                 $ 2.58   ^(1)
                                                                          
                                                                          
^(1) Basic and diluted EPS were calculated using the
following (in millions):
                                                                          
                                                    YTD June    YTD June

                                                    2013        2012
                                                                          
Net earnings attributable to PMI                    $  4,249    $ 4,478
Less distributed and undistributed earnings
attributable
to share-based payment awards                         23        24    
Net earnings for basic and diluted EPS              $  4,226    $ 4,454 
                                                               
Weighted-average shares for basic and diluted         1,639     1,710 
EPS
                                                                          


Schedule 9
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Condensed Balance Sheets
($ in millions, except ratios)
(Unaudited)
                                                         
                                         June 30,        December 31,
                                         2013                2012
Assets
Cash and cash equivalents                $  3,586            $  2,983
All other current assets                    13,169              13,607
Property, plant and equipment, net          6,396               6,645
Goodwill                                    9,529               9,900
Other intangible assets, net                3,472               3,619
Other assets                               988               916     
Total assets                             $  37,140          $  37,670  
                                                                          
Liabilities and Stockholders'
(Deficit) Equity
Short-term borrowings                    $  2,684            $  2,419
Current portion of long-term debt           1,256               2,781
All other current liabilities               10,766              11,816
Long-term debt                              21,559              17,639
Deferred income taxes                       1,842               1,875
Other long-term liabilities                2,962             2,993   
Total liabilities                           41,069              39,523
                                                                          
Redeemable noncontrolling interest          1,296               1,301
                                                                          
Total PMI stockholders' deficit             (5,466  )           (3,476  )
Noncontrolling interests                   241               322     
Total stockholders' deficit                (5,225  )          (3,154  )
Total liabilities and stockholders'      $  37,140          $  37,670  
(deficit) equity
                                                                          
Total debt                               $  25,499           $  22,839
Total debt to EBITDA                        1.76      ^(1)      1.55      ^(1)
Net debt to EBITDA                          1.52      ^(1)      1.35      ^(1)
                                                                          

(1) For the calculation of Total Debt to EBITDA and Net Debt to EBITDA ratios,
refer to Schedule 18.


Schedule 10
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Reconciliation of Non-GAAP Measures
Adjustments for the Impact of Currency and Acquisitions
For the Quarters Ended June 30,
($ in millions)
(Unaudited)
                                                                                                                                          
2013                                                                                           2012                              % Change in Reported Net Revenues
                                                                                                                                 excluding Excise Taxes
                       Reported               Reported               Reported Net                                    Reported
                       Net                    Net                    Revenues                                        Net                                Reported
Reported    Less       Revenues    Less       Revenues    Less       excluding                 Reported   Less       Revenues               Reported    excluding
Net         Excise     excluding   Currency   excluding   Acquisi-   Excise                    Net        Excise     excluding   Reported  excluding  Currency &
Revenues    Taxes      Excise                 Excise      tions      Taxes,                    Revenues   Taxes      Excise                 Currency    Acquisitions
                       Taxes                  Taxes &                Currency &                                      Taxes
                                              Currency               Acquisitions
                                                                                                                                                        
$  7,245    $ 5,039    $  2,206    $ (25  )   $  2,231    $    -     $    2,231     European   $ 7,280    $ 4,995    $  2,285    (3.5  )%   (2.4  )%    (2.4    )%
                                                                                    Union
   5,377      3,196       2,181      (49  )      2,230         -          2,230     EEMA         5,062      2,911       2,151    1.4   %    3.7   %     3.7     %
   5,381      2,689       2,692      (141 )      2,833         -          2,833     Asia         5,317      2,462       2,855    (5.7  )%   (0.8  )%    (0.8    )%
                                                                                    Latin
   2,480      1,642       838        (28  )      866           -          866       America      2,378      1,549       829      1.1   %    4.5   %     4.5     %
                                                                                    & Canada
                                                                                                           
$  20,483   $ 12,566   $  7,917    $ (243 )   $  8,160    $    -     $    8,160     PMI        $ 20,037   $ 11,917   $  8,120    (2.5  )%   0.5   %     0.5     %
                                                                                    Total
                                                                                                                                                        
                                                                                                                                                        
2013                                                                                           2012                              % Change in Reported Operating
                                                                                                                                 Companies Income
                                              Reported               Reported
Reported                                      Operating              Operating                                       Reported                           Reported
Operating                          Less       Companies   Less       Companies                                       Operating              Reported    excluding
Companies                          Currency   Income      Acquisi-   Income                                          Companies   Reported  excluding  Currency &
Income                                        excluding   tions      excluding                                       Income                 Currency    Acquisitions
                                              Currency               Currency &
                                                                     Acquisitions
                                                                                                                                                        
$  1,082                           $ 2        $  1,080    $    -     $    1,080     European                         $  1,117    (3.1  )%   (3.3  )%    (3.3    )%
                                                                                    Union
   945                               (28  )      973           -          973       EEMA                                948      (0.3  )%   2.6   %     2.6     %
   1,128                             (112 )      1,240         -          1,240     Asia                                1,364    (17.3 )%   (9.1  )%    (9.1    )%
                                                                                    Latin
   255                               (8   )      263           -          263       America                             249      2.4   %    5.6   %     5.6     %
                                                                                    & Canada
                                                                                                               
$  3,410                           $ (146 )   $  3,556    $    -     $    3,556     PMI                              $  3,678    (7.3  )%   (3.3  )%    (3.3    )%
                                                                                    Total
                                                                                                                                                                


Schedule 11
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Reconciliation of Non-GAAP Measures
Reconciliation of Reported Operating Companies Income to Adjusted Operating Companies Income &
Reconciliation of Adjusted Operating Companies Income Margin, excluding Currency and Acquisitions
For the Quarters Ended June 30,
($ in millions)
(Unaudited)
                                                                                                                                                            
2013                                                                                                          2012                                 % Change in Adjusted Operating
                                                                                                                                                   Companies Income
                                                  Adjusted                          Adjusted
Reported    Less           Adjusted               Operating                         Operating                 Reported    Less         Adjusted                           Adjusted
Operating   Asset          Operating   Less       Companies      Less               Companies                 Operating   Asset        Operating              Adjusted    excluding
Companies   Impairment     Companies   Currency   Income         Acquisi-           Income                    Companies   Impairment   Companies   Adjusted  excluding  Currency &
Income      & Exit         Income                 excluding      tions              excluding                 Income      & Exit       Income                 Currency    Acquisitions
            Costs                                 Currency                          Currency &                            Costs
                                                                                    Acquisitions
                                                                                                                                                                          
$  1,082    $   -          $ 1,082     $ 2        $    1,080     $      -           $  1,080       European   $  1,117    $  -         $ 1,117     (3.1  )%   (3.3  )%    (3.3    )%
                                                                                                   Union
   945          -            945         (28  )        973              -              973         EEMA          948         -           948       (0.3  )%   2.6   %     2.6     %
   1,128        (5     )     1,133       (112 )        1,245            -              1,245       Asia          1,364       -           1,364     (16.9 )%   (8.7  )%    (8.7    )%
                                                                                                   Latin
   255          -            255         (8   )        263              -              263         America       249         (8    )     257       (0.8  )%   2.3   %     2.3     %
                                                                                                   & Canada
                                                                                                                             
$  3,410    $   (5     )   $ 3,415    $ (146 )   $    3,561     $      -           $  3,561      PMI        $  3,678    $  (8    )   $ 3,686    (7.4  )%   (3.4  )%    (3.4    )%
                                                                                                   Total
                                                                                                                                                                          
                                                                                                                                                                          
                                                                                                                                                                          
2013                                                                                                          2012                                 % Points Change
                           Adjusted               Adjusted                          Adjusted                                                                  Adjusted    Adjusted
Adjusted    Net            Operating              Operating      Net Revenues       Operating                             Net          Adjusted               Operating   Operating
Operating   Revenues       Companies              Companies      excluding          Companies                 Adjusted    Revenues     Operating              Companies   Companies
Companies   excluding      Income                 Income         Excise Taxes,      Income                    Operating   excluding    Companies              Income     Income
Income      Excise         Margin                 excluding      Currency &         Margin                    Companies   Excise       Income                 Margin      Margin
excluding   Taxes &        excluding              Currency &     Acquisitions^(1)   excluding                 Income      Taxes^(1)    Margin                 excluding   excluding
Currency    Currency^(1)   Currency               Acquisitions                      Currency &                                                                Currency    Currency &
                                                                                    Acquisitions                                                                          Acquisitions
                                                                                                                                                                          
$  1,080    $   2,231        48.4  %              $    1,080     $      2,231          48.4   %    European   $  1,117    $  2,285       48.9  %              (0.5  )     (0.5    )
                                                                                                   Union
   973          2,230        43.6  %                   973              2,230          43.6   %    EEMA          948         2,151       44.1  %              (0.5  )     (0.5    )
   1,245        2,833        43.9  %                   1,245            2,833          43.9   %    Asia          1,364       2,855       47.8  %              (3.9  )     (3.9    )
                                                                                                   Latin
   263          866          30.4  %                   263              866            30.4   %    America       257         829         31.0  %              (0.6  )     (0.6    )
                                                                                                   & Canada
                                                                                                                    
$  3,561    $   8,160       43.6  %              $    3,561     $      8,160          43.6   %    PMI        $  3,686    $  8,120      45.4  %              (1.8  )     (1.8    )
                                                                                                   Total
                                                                                                                                                                          
^(1) For the calculation of net revenues excluding excise taxes, currency and acquisitions, refer to Schedule 10.


                                                             
                                                                   Schedule 12
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Reconciliation of Non-GAAP Measures
Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS and Adjusted
Diluted EPS, excluding Currency
For the Quarters Ended June 30,
(Unaudited)
                                                                   
                             2013            2012          % Change
                                                                   
Reported Diluted EPS         $   1.30            $      1.36      (4.4   )%
                                                                   
Adjustments:
Asset impairment and             -                       -
exit costs
Tax items                       -                    -
                                                                   
Adjusted Diluted EPS         $   1.30            $       1.36      (4.4   )%
                                                                   
Less:
Currency impact                 (0.07   )       
                                                                   
Adjusted Diluted
EPS, excluding               $   1.37           $      1.36      0.7    %
Currency
                                                                   

                                                              
                                                                   Schedule 13
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Reconciliation of Non-GAAP Measures
Reconciliation of Reported Diluted EPS to Reported Diluted EPS, excluding
Currency
For the Quarters Ended June 30,
(Unaudited)
                                                                   
                                            2013        2012       % Change
                                                                   
Reported Diluted EPS                        $ 1.30      $  1.36   (4.4   )%
                                                                   
Less:
Currency impact                              (0.07 )   
                                                                   
Reported Diluted EPS, excluding             $ 1.37     $  1.36   0.7    %
Currency
                                                                          


Schedule 14
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Reconciliation of Non-GAAP Measures
Adjustments for the Impact of Currency and Acquisitions
For the Six Months Ended June 30,
($ in millions)
(Unaudited)
                                                                                                                                          
2013                                                                                           2012                              % Change in Reported Net Revenues
                                                                                                                                 excluding Excise Taxes
                                              Reported
                       Reported               Net                    Reported Net                                    Reported
                       Net                    Revenues               Revenues                                        Net
                       Revenues               excluding              excluding                                       Revenues                           Reported
Reported    Less       excluding              Excise      Less       Excise                    Reported   Less       excluding              Reported    excluding
                                                                     Taxes,
Net         Excise     Excise      Less       Taxes &     Acquisi-   Currency &                Net        Excise     Excise                 excluding   Currency &
Revenues    Taxes      Taxes       Currency   Currency    tions      Acquisitions              Revenues   Taxes      Taxes       Reported  Currency   Acquisitions
                                                                                                                                                        
$  13,768   $ 9,592    $  4,176    $ 2        $  4,174    $    -     $   4,174      European   $ 13,750   $ 9,412    $  4,338    (3.7  )%   (3.8   )%   (3.8     )%
                                                                                    Union
   9,800      5,576       4,224      (39  )      4,263         -         4,263      EEMA         9,131      5,145       3,986    6.0   %    6.9    %    6.9      %
   10,632     5,150       5,482      (262 )      5,744         -         5,744      Asia         10,494     4,862       5,632    (2.7  )%   2.0    %    2.0      %
                                                                                    Latin
   4,810      3,191       1,619      (47  )      1,666         -         1,666      America      4,684      3,072       1,612    0.4   %    3.3    %    3.3      %
                                                                                    & Canada
                                                                                                           
$  39,010   $ 23,509   $  15,501   $ (346 )   $  15,847   $    -     $   15,847     PMI        $ 38,059   $ 22,491   $  15,568   (0.4  )%   1.8    %    1.8      %
                                                                                    Total
                                                                                                                                                        
                                                                                                                                                        
2013                                                                                           2012                              % Change in Reported Operating
                                                                                                                                 Companies Income
                                                                     Reported
                                              Reported               Operating
                                              Operating              Companies
Reported                                      Companies              Income                                          Reported                           Reported
Operating                                     Income      Less       excluding                                       Operating              Reported    excluding
Companies                          Less       excluding   Acquisi-   Currency &                                      Companies              excluding   Currency &
Income                             Currency   Currency    tions      Acquisitions                                    Income      Reported  Currency   Acquisitions
                                                                                                                                                        
$  2,020                           $ (10  )   $  2,030    $    -     $   2,030      European                         $  2,147    (5.9  )%   (5.4   )%   (5.4     )%
                                                                                    Union
   1,880                             (31  )      1,911         -         1,911      EEMA                                1,758    6.9   %    8.7    %    8.7      %
   2,470                             (215 )      2,685         -         2,685      Asia                                2,771    (10.9 )%   (3.1   )%   (3.1     )%
                                                                                    Latin
   509                               (12  )      521           -         521        America                             486      4.7   %    7.2    %    7.2      %
                                                                                    & Canada
                                                                                                               
$  6,879                           $ (268 )   $  7,147    $    -     $   7,147      PMI                              $  7,162    (4.0  )%   (0.2   )%   (0.2     )%
                                                                                    Total
                                                                                                                                                                 


Schedule 15
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Reconciliation of Non-GAAP Measures
Reconciliation of Reported Operating Companies Income to Adjusted Operating Companies Income &
Reconciliation of Adjusted Operating Companies Income Margin, excluding Currency and Acquisitions
For the Six Months Ended June 30,
($ in millions)
(Unaudited)
                                                                                                                                                            
2013                                                                                                          2012                                 % Change in Adjusted Operating
                                                                                                                                                   Companies Income
                                                  Adjusted                          Adjusted
Reported    Less           Adjusted               Operating                         Operating                 Reported    Less         Adjusted                           Adjusted
Operating   Asset          Operating   Less       Companies      Less               Companies                 Operating   Asset        Operating              Adjusted    excluding
Companies   Impairment     Companies   Currency   Income         Acquisi-           Income                    Companies   Impairment   Companies   Adjusted  excluding  Currency &
Income      & Exit         Income                 excluding      tions              excluding                 Income      & Exit       Income                 Currency    Acquisitions
            Costs                                 Currency                          Currency &                            Costs
                                                                                    Acquisitions
                                                                                                                                                                          
$  2,020    $  -           $ 2,020     $ (10  )   $    2,030     $     -            $  2,030       European   $  2,147    $ -          $ 2,147     (5.9  )%   (5.4  )%    (5.4    )%
                                                                                                   Union
   1,880       -             1,880       (31  )        1,911           -               1,911       EEMA          1,758      -            1,758     6.9   %    8.7   %     8.7     %
   2,470       (8      )     2,478       (215 )        2,693           -               2,693       Asia          2,771      -            2,771     (10.6 )%   (2.8  )%    (2.8    )%
                                                                                                   Latin
   509         -             509         (12  )        521             -               521         America       486        (16    )     502       1.4   %    3.8   %     3.8     %
                                                                                                   & Canada
                                                                                                                             
$  6,879    $  (8      )   $ 6,887    $ (268 )   $    7,155     $     -            $  7,155      PMI        $  7,162    $ (16    )   $ 7,178    (4.1  )%   (0.3  )%    (0.3    )%
                                                                                                   Total
                                                                                                                                                                          
                                                                                                                                                                          
                                                                                                                                                                          
2013                                                                                                          2012                                 % Points Change
                           Adjusted               Adjusted                          Adjusted                                                                  Adjusted    Adjusted
Adjusted    Net            Operating              Operating      Net Revenues       Operating                             Net          Adjusted               Operating   Operating
Operating   Revenues       Companies              Companies      excluding          Companies                 Adjusted    Revenues     Operating              Companies   Companies
Companies   excluding      Income                 Income         Excise Taxes,      Income                    Operating   excluding    Companies              Income     Income
Income      Excise         Margin                 excluding      Currency &         Margin                    Companies   Excise       Income                 Margin      Margin
excluding   Taxes &        excluding              Currency &     Acquisitions^(1)   excluding                 Income      Taxes^(1)    Margin                 excluding   excluding
Currency    Currency^(1)   Currency               Acquisitions                      Currency &                                                                Currency    Currency &
                                                                                    Acquisitions                                                                          Acquisitions
                                                                                                                                                                          
$  2,030    $  4,174         48.6  %              $    2,030     $     4,174           48.6   %    European   $  2,147    $ 4,338        49.5  %              (0.9  )     (0.9    )
                                                                                                   Union
   1,911       4,263         44.8  %                   1,911           4,263           44.8   %    EEMA          1,758      3,986        44.1  %              0.7         0.7
   2,693       5,744         46.9  %                   2,693           5,744           46.9   %    Asia          2,771      5,632        49.2  %              (2.3  )     (2.3    )
                                                                                                   Latin
   521         1,666         31.3  %                   521             1,666           31.3   %    America       502        1,612        31.1  %              0.2         0.2
                                                                                                   & Canada
                                                                                                                    
$  7,155    $  15,847       45.2  %              $    7,155     $     15,847          45.2   %    PMI        $  7,178    $ 15,568      46.1  %              (0.9  )     (0.9    )
                                                                                                   Total
                                                                                                                                                                          
^(1) For the calculation of net revenues excluding excise taxes, currency and acquisitions, refer to Schedule 14.


<td c*Story too large*
                                                          
                                                                 Schedule 16
PHILIP MORRIS INTERNATIONAL INC.
and Subsidiaries
Reconciliation of Non-GAAP Measures
Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS and Adjusted
Diluted EPS, excluding Currency
For the Six Months Ended June 30,
(Unaudited)
                                                                 
                            2013              2012               % Change
                                                                 
Reported Diluted            $    2.58         $      2.60
EPS

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