Philip Morris International’s (PMI) global travel retail sales of cigarettes and heated tobacco units (HTUs) rose +23% by volume (units) year-on-year in Q2, outperforming the sector worldwide.
The strong showing was revealed as the tobacco products giant posted a +7.1% year-on-year increase (reported; +6.8% organic) in Q2 revenues to US$10.1 billion.
PMI estimated the total worldwide market (all companies) for cigarettes and HTUs, excluding China, decreased by -0.7% to 79.8 billion units in the quarter, with a decrease in cigarettes largely offset by HTU growth.
The decrease in the estimated market was mainly driven by Australia (down -50.2%) and South Korea (down -2.4%), partly offset by global travel retail (up +7.8%), the company said.
Notably, PMI generated US travel retail volumes of approximately 2.5 million nicotine pouch cans in Q2 (with the financial impact recorded in PMI’s East Asia, Australia & Global Travel Retail division. No meaningful US travel retail volumes were posted in the prior year the company said.
PMI’s smoke-free business rose an impressive +15.2% (+14.5% organic) to US$4.2 billion in Q2, accounting for 41% of total net revenues.
Q2 operating income rose +7.8% (+14.9% organic) to US$3.7 billion.
Strong first-half momentum
For the first six months, sales rose +6.5% (+8.4% organic) to US$19.4 billion with smoke-free revenues up +15.1% (+17.3%).
H1 operating income rose +11.8% (+15.4% organic) to US$7.3 billion.
“Our business delivered very strong results in the second quarter, with record net revenues and exceptional growth in operating income and adjusted diluted EPS,” said PMI Chief Executive Officer Jacek Olczak.
“These results reflect excellent momentum in our multicategory smoke-free business, with a reacceleration of IQOS adjusted in-market sales growth and ZYN U.S. offtake growth, coupled with combustibles resilience. Given our strong year-to-date performance, we are raising our full-year guidance.”
