Phillips Morris International

• Philip  Morris International (PMI) reported a 9.4% increase in net   revenues and a 6.7% increase excluding   currency and acquisitions for the 2021 financial year. Adjusted net revenues   was up by 7.6% on an organic basis.

• The company   reported adjusted diluted EPS of $6.08, up by 17.6%; and up by 15.3%   excluding currency effects. For the 2022 financial year the company expects   adjusted EPS of between $6.57 and $6.75.

• Despite cost   pressures, the operating margin increased by 1.7% to 42.6%.PMI increased the   regular quarterly dividend by 4.2% to an annualized rate of $5.00 per common   share.

• Although   volumes of traditional cigarettes continued to decline, this was offset by   the continuing strong performance of new generation heated tobacco units   (HTU). For the year, total cigarette volumes declined by -0.6% while HTU   products increased by 24.8% for an overall volume increase of 2.2%. HTU now   accounts for 30.7% of Philip Morris revenue with the company targeting 40% by   2023 and 50% by 2025.

• Philip   Morris currently trades on dividend yield of 4.8% and is likely to grow this   dividend by mid to high single digits in the years to come which should   provide investors with sound long-term returns. Even with all the input cost   inflation around, PM is a rare staple that can still generate margin   expansion of 50 - 150bps.