Philip Morris Profit Tops Estimates After Price Increases

Philip Morris International Inc. (PM), the world’s largest publicly traded tobacco company, reported first-quarter profit that beat analysts’ estimates, helped by an increase in pricing.

Net income rose 13 percent to $2.16 billion, or $1.25 a share, from $1.92 billion, or $1.06, a year earlier, the New York-based company said today in a statement. Analysts projected $1.19, the average of 16 estimates compiled by Bloomberg.

Chief Executive Officer Louis Camilleri boosted shipments of the company’s 10 biggest cigarette brands, including Marlboro, while price increases added $369 million to sales. The company increased sales in Asia, making up for the impact of strength in the U.S. dollar that hurt sales generated abroad.

“The volume gains were great, with strength across most brands and most regions,” Jack Russo, an analyst at Edward Jones & Co., said today in an e-mail. “The core underlying business remains real strong,” said Russo, who recommends buying the shares.

Philip Morris reduced its full-year earnings forecast because of the stronger U.S. dollar. Profit will be $5.20 to $5.30 share, down from a February projection of $5.25 to $5.35.

Excluding excise taxes, total sales in the first quarter rose 9.7 percent to $7.4 billion, beating the $7.22 billion average of analysts’ estimates.

Philip Morris, which generates all its revenue outside the U.S., fell 1.1 percent to $86.75 at the close in New York. The shares have gained 11 percent this year.

To contact the reporter on this story: Chris Burritt in Greensboro at cburritt@bloomberg.net

To contact the editor responsible for this story: Kevin Orland at korland@bloomberg.net

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