![]() Exhibit 99.3 2012 Second-Quarter Results July 19, 2012 |
![]() 2 Introduction Unless otherwise stated, we will be talking about results for the second- quarter 2012 and comparing them with the same period in 2011 References to PMI volumes refer to PMI shipment data, unless otherwise stated Industry volume and market shares are the latest data available from a number of internal and external sources Organic volume refers to volume excluding acquisitions Net revenues exclude excise taxes OCI stands for Operating Companies Income, which is defined as operating income before general corporate expenses and the amortization of intangibles. OCI growth rates are on an adjusted basis, which excludes asset impairment, exit and other costs Data tables showing adjustments to net revenues and OCI for currency, acquisitions, asset impairment, exit and other costs, free cash flow calculations, adjustments to EPS, and reconciliations to U.S. GAAP measures are at the end of today’s webcast slides and are posted on our web site |
![]() 3 Forward-Looking and Cautionary Statements This presentation and related discussion contain forward-looking statements. Achievement of projected results is subject to risks, uncertainties and inaccurate assumptions, and PMI is identifying important factors that, individually or in the aggregate, could cause actual results to differ materially from those contained in any forward-looking statements made by PMI PMI’s business risks include: significant increases in cigarette-related taxes; the imposition of discriminatory excise tax structures; fluctuations in customer inventory levels due to increases in product taxes and prices; increasing marketing and regulatory restrictions, often with the goal of preventing the use of tobacco products; health concerns relating to the use of tobacco products and exposure to environmental tobacco smoke; litigation related to tobacco use; intense competition; the effects of global and individual country economic, regulatory and political developments; changes in adult smoker behavior; lost revenues as a result of counterfeiting, contraband and cross-border purchases; governmental investigations; unfavorable currency exchange rates and currency devaluations; adverse changes in applicable corporate tax laws; adverse changes in the cost and quality of tobacco and other agricultural products and raw materials; and the integrity of its information systems. PMI’s future profitability may also be adversely affected should it be unsuccessful in its attempts to produce products with the potential to reduce the risk of smoking- related diseases; if it is unable to successfully introduce new products, promote brand equity, enter new markets or improve its margins through increased prices and productivity gains; if it is unable to expand its brand portfolio internally or through acquisitions and the development of strategic business relationships; or if it is unable to attract and retain the best global talent PMI is further subject to other risks detailed from time to time in its publicly filed documents, including the Form 10-Q for the quarter ended March 31, 2012. PMI cautions that the foregoing list of important factors is not a complete discussion of all potential risks and uncertainties. PMI does not undertake to update any forward-looking statement that it may make from time to time, except in the normal course of its public disclosure obligations |
![]() 4 Strong Underlying Business Results in Q2, 2012 Organic cigarette volume down by 1.2% Organic cigarette volume, excluding Japan hurdle, up by 1.4% Organic OTP volume up by 11.8% Note: OTP stands for other tobacco products, including cigars, cigarillos, fine cut, pipe tobacco and snus. Fine cut converted to cigarette equivalents based on conversion ratio of 1 unit = 0.75g Source: PMI Financials |
![]() 5 Strong Underlying Business Results in Q2, 2012 Organic cigarette volume down by 1.2% Organic cigarette volume, excluding Japan hurdle, up by 1.4% Organic OTP volume up by 11.8% Net revenues, excluding currency and acquisitions, up by 2.9% Adjusted OCI, excluding currency and acquisitions, up by 3.5% Note: OTP stands for other tobacco products, including cigars, cigarillos, fine cut, pipe tobacco and snus. Fine cut converted to cigarette equivalents based on conversion ratio of 1 unit = 0.75g Source: PMI Financials |
![]() 6 Strong Underlying Business Results in Q2, 2012 Organic cigarette volume down by 1.2% Organic cigarette volume, excluding Japan hurdle, up by 1.4% Organic OTP volume up by 11.8% Net revenues, excluding currency and acquisitions, up by 2.9% Adjusted OCI, excluding currency and acquisitions, up by 3.5% Adjusted diluted EPS, excluding currency, up by 9.0% Adjusted diluted EPS, excluding currency and Japan hurdle, up by 17.7% Note: OTP stands for other tobacco products, including cigars, cigarillos, fine cut, pipe tobacco and snus. Fine cut converted to cigarette equivalents based on conversion ratio of 1 unit = 0.75g Source: PMI Financials |
![]() Excellent First-Half 2012 Results (a) Excluding currency and acquisitions (b) Excluding currency Source: PMI Financials (a) (a) 7 (%) Growth H1, 2012 vs. H1, 2011 (b) 1.8 6.5 8.3 13.3 0 15 Organic Cigarette Volume Net Revenues Adjusted OCI Adjusted Diluted EPS |
![]() 8 2012 EPS Guidance These results confirm our expectation of solid organic cigarette volume growth in 2012 Continued strong pricing and a favorable product mix only partially offset by an unfavorable geographic mix At current prevailing exchange rates, forecast currency headwind slightly above the 25 cents per share predicted in June for full year Strong underlying business momentum expected to offset the additional unfavorable currency impact of 2 cents per share Source: PMI forecasts |
![]() 9 2012 EPS Guidance Reported diluted 2012 EPS guidance range reaffirmed at $5.10 to $5.20, compared to $4.85 in 2011 On a currency-neutral basis, our guidance implies a forecast growth rate of approximately 10% to 12%, compared to adjusted diluted EPS of $4.88 in 2011 Source: PMI forecasts |
![]() EU Region: Cigarette Industry Volume Under Considerable Pressure % Change Q2, 2012 H1, 2012 Greece (16.8) (18.9) Hungary (16.0) (10.9) Spain (18.0) (10.0) Italy (10.5) (8.5) Netherlands (5.7) (6.0) EU Region (9.7) (5.8) France (5.9) (4.0) Poland (7.7) (3.7) Czech Republic (4.2) (3.6) UK (6.0) (3.1) Germany (5.1) (1.3) 10 Source: PMI estimates |
![]() EU Region: Deteriorating Job Market 11 (a) March 2012 vs. June 2011 (b) March 2012 Note: Gre. is Greece, Spa. is Spain, Ita. is Italy, Neth. is Netherlands, EU Avg. is EU average, Fra. is France, Pol. is Poland, Hun. is Hungary, Cze. is Czech Republic and Ger. is Germany Source: Eurostat (pp) Avg. (a) (a) Variance in Unemployment Rates May 2012 vs. June 2011 0 (%) Unemployment Rates (May 2012) Avg. Cze. Ger. (b) (b) 0.7 5 Gre. Spa. Ita. Neth. EU Fra. Pol. UK Hun. 10.3 0 5 10 15 20 25 Spa. Gre. Hun. EU Ita. Fra. Pol. UK Cze. Ger. Neth. (1) |
![]() EU Region: Resilient Cigarette Market Shares Variance vs. PY Q2, 2012 H1, 2012 Q2, 2012 H1, 2012 Total PMI 38.5% 37.9% (0.2)pp (0.4)pp Marlboro 18.4 18.0 () ()pp L&M 6.6 6.6 (0.2) (- )pp Chesterfield 3.5 3.4 () (p 12 Source: PMI estimates 0.3 0.1 0.3 0.4 |
![]() EU Region: PMI Gaining Share in Expanding Fine Cut Category Variance vs. PY Q2, 2012 H1, 2012 Q2, 2012 H1, 2012 Industry Volume (units billion) 30.9 59.3 ( PMI Share (%) 14.1 14.0 ( ( 13 Note: Fine cut converted to cigarette equivalents based on conversion ratio of 1 unit = 0.75g Source: PMI estimates 7.7% 7.9% 1.4pp 1.7pp |
![]() Cigarette industry volume declined by 10.5% in Q2, 2012: - Reduced consumer purchasing power - Impact of price increases - Substitution by fine cut - Increase in illicit trade Marlboro performing strongly with share up in Q2, 2012 PMI overall share down despite launch of Philip Morris Selection in low-price segment Fine cut leadership 14 Italy: Increased Pressure due to Weak Economy Note: Totals may not add up due to rounding Source: PMI estimates Cigarettes Marlboro 23.0% 22.6% ( ( -)pp Chesterfield 3.5% 3.5% (0.2)pp (0.2)p Diana 12.4 % 12.6 % (0.8)pp (0.7)pp Other 14.0 % 14.1 % ( ()pp Total PMI 52.9 % 52.8 % (0.5)pp (0.6)pp Fine Cut Total PMI 31.0 % 29.8 % 24.5pp 26.0 Q2 2012 H1 2012 Q2 H1 Market Shares Variance vs. PY 0.3 pp 0.2 0.2 |
![]() 15 Germany: Positive PMI Share Momentum Cigarette industry volume declined by 5.1% in Q2, 2012: - Recent price increases - Lower consumer confidence - Difficult comparison with 2011 - Some timing issues PMI achieved modest share gains in cigarette category and continued strong momentum in fine cut Marlboro gained share in both cigarettes and fine cut in Q2, 2012 Source: PMI estimates PMI Fine Cut Market Share (%) PMI Cigarette Market Share (%) Total PMI Other Chesterfield Marlboro L&M Total PMI Other Marlboro L&M 2.0 3.2 5.9 5.6 5.0 5.3 14.8 16.0 Q2 2011 Q2 2012 21.1 21.4 10.4 10.5 36.1 36.4 Q2 2011 Q2 2012 Cigarette industry volume down by 1.3% YTD June, 2012 |
![]() EU Region: Weaker Results in Q2, 2012 Variance vs. PY Q2, 2012 H1, 2012 Q2, 2012 H1, 2012 Cigarette Volume (units billion) 51.8 99.6 (9.4)% (5.8)% OTP Volume (units billion) 4.7 9.1 ()% ()% Net Revenues ($ billion) 2.3 4.3 (0.7)% ()% Adjusted OCI ($ billion) 1.1 2.1 (2.7)% ()% 16 (a) Excluding currency and acquisitions Note: OTP stands for other tobacco products, including cigars, cigarillos, fine cut, pipe tobacco and snus. Fine cut converted to cigarette equivalents based on conversion ratio of 1 unit = 0.75g Source: PMI Financials (a) (a) (a) (a) 18.2 23.1 2.0 0.2 |
![]() EEMA Region: Another Very Strong Quarter 17 (a) Excluding acquisitions (b) Excluding currency and acquisitions Source: PMI Financials Variance vs. PY Q2, 2012 H1, 2012 Q2, 2012 H1, 2012 Cigarette Volume (units billion) 79.2 145.1 ( Net Revenues ($ billion) 2.2 4.0 Adjusted OCI ($ billion) 0.9 1.8 4.9% (a) 12.7 (b) 22.9 (b) 4.2% (a) 12.6 (b) 20.6 (b) |
![]() 18 EEMA Region: Positive Pricing and Volume/Mix Note: Variances at OCI level Source: PMI Financials 0 125 ($ million) Q2, 2012 114 104 Pricing Variance Volume/Mix Variance |
![]() EEMA Region: Growth of Key Brands (units million) 19 Chest. Note: Marlb. is Marlboro, Parl. is Parliament and Chest. is Chesterfield Source: PMI Financials Street Soyuz Volume Growth (Q2, 2012 vs. Q2, 2011) (400) 0 400 800 1,200 Marlb. Bond L&M Parl. Lark Optima Next Muratti Apollo - |
![]() Total market grew slightly during first half of 2012 PMI volume increased by 8.7% in Q2, 2012 Adult smokers continue to uptrade gradually PMI market share gains QTD May thanks to Parliament, L&M, Bond Street and Next Price increase of RUB 3/pack in July 2012 Price Segments (%) Russia: Market and Share Growth 20 PMI Market Share (%) Premium Mid Low Super- Low (a) Q2 and H1 data through end May Source: PMI estimates, PMI Financials and Nielsen +0.7pp (a) (a) (a) (a) 25.4 26.1 Q2 2011 Q2 2012 35.7 32.5 23.7 26.0 24.9 25.7 15.7 15.8 H1 2011 H1 2012 |
![]() 21 Russia: Marlboro ClearTaste Launched |
![]() Asia Region: Japan Hurdle Masks Another Very Strong Quarter Variance vs. PY Q2, 2012 H1, 2012 Q2, 2012 H1, 2012 Cigarette Volume (units billion) 83.5 164.5 (0.7)% (5.4 )% Cigarette Volume ex. Japan Hurdle (7.4 )% (9.8)% Adjusted OCI ($ billion) 1.4 2.8 (2.6)% (8.9 )% 22 (a) Excluding currency and acquisitions Source: PMI Financials (a) (a) |
![]() Japan: Resilient Share Performance 23 Industry volume should be stable in 2012 and underlying trend remains a moderate decline of 1-2% per year PMI Q2, 2012 market share slightly down due to acceleration in new launches by Japan Tobacco Marlboro Black Menthol Edge launched in Q2, 2012 Marlboro Ice Blast 5mg / 1mg launched this July Increase of Consumption Tax from 5% to 8% in 2014 and 10% in 2015 approved Source: PMI estimates and Tobacco Institute of Japan PMI Market Share (%) |
![]() Indonesia: PMI Momentum Continues 24 Industry volume growth of 6.9% in Q2, 2012 PMI volume increased by 17.8% in second quarter Adult smokers uptrading in strong economy PMI share up 3.1 points to 33.5% in Q2, 2012: Strongest and broadest portfolio Sampoerna A fastest-growing brand Rounded price points Premium (a) Mid Low (a) Includes above premium Source: PMI estimates and PMI Financials +3.1pp Price Segments (%) PMI Market Share (%) |
![]() 25 Favorable Pricing Continued in Q2, 2012 Note: Variances at OCI level Source: PMI Financials ($ million) |
![]() Strong Brand Performance Continues Volume Growth (H1, 2012 vs. H1, 2011) (a) 26 (a) Excluding Japan hurdle Source: PMI Financials (units billion) 0 2.5 5.0 |
![]() PMI Expanding its Market Share 27 Top 30 PMI OCI Markets (a) (%) (a) Excluding duty free Note: Historical data adjusted for pro forma inclusion of business combination with Fortune Tobacco Corporation in the Philippines and Jordan acquisition Source: PMI Financials and PMI estimates |
![]() 28 Free Cash Flow (a) Impacted by Currency and Working Capital Requirements (a) Free cash flow equals net cash provided by operating activities less capital expenditures Source: PMI Financials ($ million) |
![]() 29 Share Repurchase Program Further Extended In Q2, 2012, PMI spent $1.5 billion to repurchase 17.8 million shares New three-year $18 billion share repurchase program to start in August when funds from previous authorization fully utilized Target for 2012 remains $6 billion in share repurchases Since spin, $24.4 billion spent to repurchase 21.3% of shares outstanding at the time Source: PMI Financials |
![]() Underlying business momentum remains strong Very strong results in EEMA and Asia Regions offset unusually weak industry volume in EU Region and the Japan hurdle Breadth of footprint, superior brand portfolio and continued strong pricing environment driving growth Net revenues and adjusted OCI increased in Q2, 2012, excluding currency and acquisitions Adjusted diluted EPS, excluding currency, up 9.0% in Q2, 2012 Reaffirmed guidance range of $5.10 to $5.20 for reported diluted EPS in 2012, despite slightly greater currency unfavorability This represents a growth rate of approximately 10% to 12% on a currency-neutral basis, compared to adjusted diluted EPS of $4.88 in 2011 30 Conclusion Source: PMI Financials |
![]() 2012 Second-Quarter Results Questions & Answers |
![]() PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Adjustments for the Impact of Currency and Acquisitions For the Quarters Ended June 30, ($ in millions) (Unaudited) 32 Reported Net Revenues Less Excise Taxes Reported Net Revenues excluding Excise Taxes Less Currency Reported Net Revenues excluding Excise Taxes & Currency Less Acquisi- tions Reported Net Revenues excluding Excise Taxes, Currency & Acquisitions Reported Net Revenues Less Excise Taxes Reported Net Revenues excluding Excise Taxes Reported Reported excluding Currency Reported excluding Currency & Acquisitions 7,280 $ 4,995 $ 2,285 $ (195) $ 2,480 $ - $ 2,480 $ European Union 8,080 $ 5,583 $ 2,497 $ (8.5)% (0.7)% (0.7)% 5,062 2,911 2,151 (127) 2,278 11 2,267 EEMA 4,603 2,591 2,012 6.9% 13.2% 12.7% 5,317 2,462 2,855 (29) 2,884 - 2,884 Asia 5,146 2,210 2,936 (2.8)% (1.8)% (1.8)% 2,378 1,549 829 (51) 880 - 880 Latin America & Canada 2,405 1,577 828 0.1% 6.3% 6.3% 20,037 $ 11,917 $ 8,120 $ (402) $ 8,522 $ 11 $ 8,511 $ PMI Total 20,234 $ 11,961 $ 8,273 $ (1.8)% 3.0% 2.9% Reported Operating Companies Income Less Currency Reported Operating Companies Income excluding Currency Less Acquisi- tions Reported Operating Companies Income excluding Currency & Acquisitions Reported Operating Companies Income Reported Reported excluding Currency Reported excluding Currency & Acquisitions 1,117 $ (130) $ 1,247 $ - $ 1,247 $ 1,280 $ (12.7)% (2.6)% (2.6)% 948 (80) 1,028 2 1,026 835 13.5% 23.1% 22.9% 1,364 3 1,361 - 1,361 1,398 (2.4)% (2.6)% (2.6)% 249 (25) 274 - 274 268 (7.1)% 2.2% 2.2% 3,678 $ (232) $ 3,910 $ 2 $ 3,908 $ 3,781 $ (2.7)% 3.4% 3.4% 2012 2011 % Change in Reported Operating Companies Income 2012 2011 % Change in Reported Net Revenues excluding Excise Taxes |
![]() PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Reported Operating Companies Income to Adjusted Operating Companies Income & Reconciliation of Adjusted Operating Companies Income Margin, excluding Currency and Acquisitions For the Quarters Ended June 30, ($ in millions) (Unaudited) 33 Reported Operating Companies Income Less Asset Impairment & Exit Costs Adjusted Operating Companies Income Less Currency Adjusted Operating Companies Income excluding Currency Less Acquisi- tions Adjusted Operating Companies Income excluding Currency & Acquisitions Reported Operating Companies Income Less Asset Impairment & Exit Costs Adjusted Operating Companies Income Adjusted Adjusted excluding Currency Adjusted excluding Currency & Acquisitions 1,117 $ - $ 1,117 $ (130) $ 1,247 $ - $ 1,247 $ European Union 1,280 $ (1) $ 1,281 $ (12.8)% (2.7)% (2.7)% 948 - 948 (80) 1,028 2 1,026 EEMA 835 - 835 13.5% 23.1% 22.9% 1,364 - 1,364 3 1,361 - 1,361 Asia 1,398 - 1,398 (2.4)% (2.6)% (2.6)% 249 (8) 257 (25) 282 - 282 Latin America & Canada 268 - 268 (4.1)% 5.2% 5.2% 3,678 $ (8) $ 3,686 $ (232) $ 3,918 $ 2 $ 3,916 $ PMI Total 3,781 $ (1) $ 3,782 $ (2.5)% 3.6% 3.5% % Points Change Adjusted Operating Companies Income excluding Currency Net Revenues excluding Excise Taxes & Currency (a) Adjusted Operating Companies Income Margin excluding Currency Adjusted Operating Companies Income excluding Currency & Acquisitions Net Revenues excluding Excise Taxes, Currency & Acquisitions (a) Adjusted Operating Companies Income Margin excluding Currency & Acquisitions Adjusted Operating Companies Income Net Revenues excluding Excise Taxes (a) Adjusted Operating Companies Income Margin Adjusted Operating Companies Income Margin excluding Currency Adjusted Operating Companies Income Margin excluding Currency & Acquisitions 1,247 $ 2,480 $ 50.3% 1,247 $ 2,480 $ 50.3% European Union 1,281 $ 2,497 $ 51.3% (1.0) (1.0) 1,028 2,278 45.1% 1,026 2,267 45.3% EEMA 835 2,012 41.5% 3.6 3.8 1,361 2,884 47.2% 1,361 2,884 47.2% Asia 1,398 2,936 47.6% (0.4) (0.4) 282 880 32.0% 282 880 32.0% Latin America & Canada 268 828 32.4% (0.4) (0.4) 3,918 $ 8,522 $ 46.0% 3,916 $ 8,511 $ 46.0% PMI Total 3,782 $ 8,273 $ 45.7% 0.3 0.3 % Change in Adjusted Operating Companies Income 2011 2012 2011 2012 (a) For the calculation of net revenues excluding excise taxes, currency and acquisitions, refer to previous slide |
![]() PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS and Adjusted Diluted EPS, excluding Currency For the Quarters Ended June 30, (Unaudited) 34 2012 2011 % Change Reported Diluted EPS 1.36 $ 1.35 $ 0.7% Adjustments: Asset impairment and exit costs - - Tax items - (0.01) Adjusted Diluted EPS 1.36 $ 1.34 $ 1.5% Less: Currency impact (0.10) Adjusted Diluted EPS, excluding Currency 1.46 $ 1.34 $ 9.0% |
![]() PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Reported Diluted EPS to Reported Diluted EPS, excluding Currency For the Quarters Ended June 30, (Unaudited) 35 2012 2011 % Change Reported Diluted EPS 1.36 $ 1.35 $ 0.7% Less: Currency impact (0.10) Reported Diluted EPS, excluding Currency 1.46 $ 1.35 $ 8.1% |
![]() PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Adjustments for the Impact of Currency and Acquisitions For the Six Months Ended June 30, ($ in millions) (Unaudited) 36 Reported Net Revenues Less Excise Taxes Reported Net Revenues excluding Excise Taxes Less Currency Reported Net Revenues excluding Excise Taxes & Currency Less Acquisi- tions Reported Net Revenues excluding Excise Taxes, Currency & Acquisitions Reported Net Revenues Less Excise Taxes Reported Net Revenues excluding Excise Taxes Reported Reported excluding Currency Reported excluding Currency & Acquisitions 13,750 $ 9,412 $ 4,338 $ (249) $ 4,587 $ - $ 4,587 $ European Union 14,495 $ 9,997 $ 4,498 $ (3.6)% 2.0% 2.0% 9,131 5,145 3,986 (200) 4,186 20 4,166 EEMA 8,274 4,575 3,699 7.8% 13.2% 12.6% 10,494 4,862 5,632 45 5,587 1 5,586 Asia 9,434 4,175 5,259 7.1% 6.2% 6.2% 4,684 3,072 1,612 (90) 1,702 - 1,702 Latin America & Canada 4,561 2,953 1,608 0.2% 5.8% 5.8% 38,059 $ 22,491 $ 15,568 $ (494) $ 16,062 $ 21 $ 16,041 $ PMI Total 36,764 $ 21,700 $ 15,064 $ 3.3% 6.6% 6.5% Reported Operating Companies Income Less Currency Reported Operating Companies Income excluding Currency Less Acquisi- tions Reported Operating Companies Income excluding Currency & Acquisitions Reported Operating Companies Income Reported Reported excluding Currency Reported excluding Currency & Acquisitions 2,147 $ (155) $ 2,302 $ - $ 2,302 $ European Union 2,286 $ (6.1)% 0.7% 0.7% 1,758 (124) 1,882 2 1,880 EEMA 1,557 12.9% 20.9% 20.7% 2,771 56 2,715 - 2,715 Asia 2,491 11.2% 9.0% 9.0% 486 (42) 528 - 528 Latin America & Canada 519 (6.4)% 1.7% 1.7% 7,162 $ (265) $ 7,427 $ 2 $ 7,425 $ PMI Total 6,853 $ 4.5% 8.4% 8.3% 2012 2011 % Change in Reported Operating Companies Income 2012 2011 % Change in Reported Net Revenues excluding Excise Taxes |
![]() PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures 37 Reconciliation of Reported Operating Companies Income to Adjusted Operating Companies Income & Reconciliation of Adjusted Operating Companies Income Margin, excluding Currency and Acquisitions For the Six Months Ended June 30, ($ in millions) (Unaudited) Reported Operating Companies Income Less Asset Impairment & Exit Costs Adjusted Operating Companies Income Less Currency Adjusted Operating Companies Income excluding Currency Less Acquisi- tions Adjusted Operating Companies Income excluding Currency & Acquisitions Reported Operating Companies Income Less Asset Impairment & Exit Costs Adjusted Operating Companies Income Adjusted Adjusted excluding Currency Adjusted excluding Currency & Acquisitions 2,147 $ - $ 2,147 $ (155) $ 2,302 $ - $ 2,302 $ European Union 2,286 $ (12) $ 2,298 $ (6.6)% 0.2% 0.2% 1,758 - 1,758 (124) 1,882 2 1,880 EEMA 1,557 (2) 1,559 12.8% 20.7% 20.6% 2,771 - 2,771 56 2,715 - 2,715 Asia 2,491 (2) 2,493 11.2% 8.9% 8.9% 486 (16) 502 (42) 544 - 544 Latin America & Canada 519 (1) 520 (3.5)% 4.6% 4.6% 7,162 $ (16) $ 7,178 $ (265) $ 7,443 $ 2 $ 7,441 $ PMI Total 6,853 $ (17) $ 6,870 $ 4.5% 8.3% 8.3% % Points Change Adjusted Operating Companies Income excluding Currency Net Revenues excluding Excise Taxes & Currency (a) Adjusted Operating Companies Income Margin excluding Currency Adjusted Operating Companies Income excluding Currency & Acquisitions Net Revenues excluding Excise Taxes, Currency & Acquisitions (a) Adjusted Operating Companies Income Margin excluding Currency & Acquisitions Adjusted Operating Companies Income Net Revenues excluding Excise Taxes (a) Adjusted Operating Companies Income Margin Adjusted Operating Companies Income Margin excluding Currency Adjusted Operating Companies Income Margin excluding Currency & Acquisitions 2,302 $ 4,587 $ 50.2% 2,302 $ 4,587 $ 50.2% European Union 2,298 $ 4,498 $ 51.1% (0.9) (0.9) 1,882 4,186 45.0% 1,880 4,166 45.1% EEMA 1,559 3,699 42.1% 2.9 3.0 2,715 5,587 48.6% 2,715 5,586 48.6% Asia 2,493 5,259 47.4% 1.2 1.2 544 1,702 32.0% 544 1,702 32.0% Latin America & Canada 520 1,608 32.3% (0.3) (0.3) 7,443 $ 16,062 $ 46.3% 7,441 $ 16,041 $ 46.4% PMI Total 6,870 $ 15,064 $ 45.6% 0.7 0.8 2012 2011 2012 2011 % Change in Adjusted Operating Companies Income (a) For the calculation of net revenues excluding excise taxes, currency and acquisitions, refer to previous slide |
![]() PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS and Adjusted Diluted EPS, excluding Currency For the Six Months Ended June 30, (Unaudited) 38 2012 2011 % Change Reported Diluted EPS 2.60 $ 2.42 $ 7.4% Adjustments: Asset impairment and exit costs 0.01 0.01 Tax items - (0.02) Adjusted Diluted EPS 2.61 $ 2.41 $ 8.3% Less: Currency impact (0.12) Adjusted Diluted EPS, excluding Currency 2.73 $ 2.41 $ 13.3% |
![]() PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Reported Diluted EPS to Reported Diluted EPS, excluding Currency For the Six Months Ended June 30, (Unaudited) 39 2012 2011 % Change Reported Diluted EPS 2.60 $ 2.42 $ 7.4% Less: Currency impact (0.12) Reported Diluted EPS, excluding Currency 2.72 $ 2.42 $ 12.4% |
![]() PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS For the Year Ended December 31, (Unaudited) 40 2011 Reported Diluted EPS 4.85 $ Adjustments: Asset impairment and exit costs 0.05 Tax items (0.02) Adjusted Diluted EPS 4.88 $ |
![]() PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries Reconciliation of Non-GAAP Measures Reconciliation of Operating Cash Flow to Free Cash Flow and Free Cash Flow, excluding Currency For the Quarters and Six Months Ended June 30, ($ in millions) (Unaudited) (a) Operating Cash Flow 41 For the Quarters Ended For the Six Months Ended June 30, June 30, 2012 2011 % Change 2012 2011 % Change Net cash provided by operating activities (a) 3,480 $ 4,120 $ (15.5)% 5,378 $ 6,515 $ (17.5)% Less: Capital expenditures 249 186 476 345 Free cash flow 3,231 $ 3,934 $ (17.9)% 4,902 $ 6,170 $ (20.6)% Less: Currency impact (389) (439) Free cash flow, excluding currency 3,620 $ 3,934 $ (8.0)% 5,341 $ 6,170 $ (13.4)% |
![]() 2012 Second-Quarter Results July 19, 2012 |