Philip Morris Profits Match Estimates
Philip Morris Cos. Inc., the world's largest tobacco company, Tuesday posted higher third-quarter profits of $2.095 billion, meeting Wall Street estimates, despite continued declines in its domestic and international tobacco operations.
The company's Kraft Foods and Miller Beer divisions posted gains in both volume and earnings, driven by improved domestic business and strong gains in Western Europe and Asia.
Philip Morris, which recently acknowledged for the first time that medical evidence indicates smoking causes disease, including cancer, reported quarterly earnings of 87 cents per share, in line with the consensus estimate of analysts polled by First Call/Thomson Financial.
In the 1998 third quarter the company reported earnings of $2.054 billion, or 84 cents per share.
The New York-based company posted a 7.2 percent jump in operating revenues in the quarter, to $19.9 billion from $18.5 billion a year earlier.
Philip Morris said domestic cigarette volume -- shipments to wholesalers -- was down 10.6 percent in the quarter, in line with estimates, due mainly to higher cigarette prices in the United States. Third-quarter shipments of the company's best-known cigarette, Marlboro, fell 10.8 percent.
International tobacco consumption fell 5.8 percent due to weakness in Russia and Eastern Europe, reflecting economic recovery there that was slower than expected, and weak worldwide duty-free shipments, the company said.
The 1999 third-quarter figures exclude $136 million in pretax charges related to the closure of a factory in Brazil, and $8 million in pre-tax charges for severance costs in the company's domestic tobacco business. Results for the 1998 third quarter exclude $121 million in pre-tax charges for a tobacco litigation settlement.