Philip Morris International
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Philip Morris International, (PMI) based in Lausanne, Switzerland, held a 15.5% share of the international cigarette market in 2005. Its brands, led by Marlboro and L&M, are sold in over 160 countries around the world. Philip Morris International is an operating company of Altria Group, Inc. (Altria) PMI's brands are made in more than 50 factories around the world.
Founded in the 19th century, Philip Morris has grown into a worldwide organization; today Philip Morris International alone employs more than 80,000 people
Philip Morris International Inc. (PMI) achieved record financial results in 2005, aided by positive currency and income from acquisitions, and increased its share in numerous markets.
Cigarette shipment volume increased 5.7% to 804.5 billion units, with widespread gains in many markets, and acquisitions in Indonesia Sampoerna and Colombia, partially offset by lower shipments in the European Union. Total Marlboro cigarette shipments increased 2.0% to 322.1 billion units, with gains in Eastern Europe, the Middle East & Africa, as well as higher inventories in Japan following the expiration of the Marlboro license with Japan Tobacco in May and the one-time inventory sale to a new distributor in Italy, partially offset by declines in Germany and worldwide duty-free. Share gains for Marlboro were achieved in the top income markets of Egypt, France, Japan, Mexico, Portugal, Russia, Turkey, Ukraine and the United Kingdom.
Operating companies income rose 19.2% to $7.8 billion, due primarily to higher pricing, as well as the impact of acquisitions, positive currency, higher income following the expiration of the Marlboro license in Japan, the impact of the one-time inventory sale in Italy and a favorable comparison with 2004 when PMI recorded a $250 million charge for the E.C. agreement. These were partially offset by unfavorable volume/mix, higher R&D, manufacturing, distribution, trade and selling expenses, and higher asset impairment and exit costs.
The EU Region still accounts for around half of PMI’s profitability. Within the Region, about two thirds of the profitability is generated by the four key markets of France, Germany, Italy and Spain.
Eastern Asia accounts for 18% of PMI profitability and the most important market is Japan.
In May 2005, Philip Morris International purchased PT HM Sampoerna Tbk for a total value of USD 5.2 billion.
On December 21, 2005 the China National Tobacco Corporation (CNTC) and Philip Morris International reached agreement on the licensed production in China of PMI’s Marlboro brand and the establishment of an international equity joint venture between China National Tobacco Import and Export Group Corporation (CNTIEGC), a wholly owned subsidiary of CNTC, and PMI.
In January 2007, PMI announced that it has entered into an agreement to acquire an additional 50.21% stake in Lakson Tobacco from major shareholders in a transaction valued at PKR 20.62 billion (USD 338.9 million). This transaction will bring PMI’s stake in Lakson Tobacco to approximately 90%.
