Philip Morris lowers FY18 EPS view to $5.02-$5.12, consensus $5.15
Had seen FY18 EPS of $5.15-$5.30. PMI revises its FY18 reported diluted EPS forecast to be in a range of $5.02-$5.12, at prevailing exchange rates, representing a projected increase of approximately 29%-32% versus reported diluted earnings per share of $3.88 in 2017. Excluding an unfavorable currency impact, at prevailing exchange rates, of approximately 7c, the forecast range represents a projected increase of approximately 8%-10% versus adjusted diluted earnings per share of $4.72 in 2017. "This revised full-year forecast primarily reflects the effect of certain product and marketing initiatives, elements of which were first announced at the Annual Meeting of Shareholders in May 2018, notably: The worldwide introduction of the next generation of IQOS devices towards the end of 2018, which requires the reduction of current generation device inventories, while the ramp-up of new devices is expected to occur in 2019; A comprehensive set of new marketing programs in Japan, including the launch in October of a new heated tobacco mainstream-price product line for more price-sensitive consumers. The forecast is based on the conservative view of a very limited favorable impact from these initiatives in Japan in 2018 (the full favorable effect therefore coming as of the beginning of 2019). Consequently, the forecast assumes that the sequential quarterly growth rate in new Japanese IQOS users for the second half of 2018 will be in line with that of the first half," the company said.