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Philip Morris 4Q up
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January 30, 2002: 12:45 p.m. ET
Philip Morris posts higher earnings, names Camilleri new CEO.
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NEW YORK (CNN/Money) - Philip Morris reported an increase in its fourth-quarter profit Wednesday, matching Wall Street forecasts.
The company also named a new CEO, confirming a succession plan that had been widely expected.
During Wednesday's trading session, Philip Morris, best known for its tobacco products, said its earned $2.2 billion, or 99 cents per share, in the fourth quarter. That's up from $2 billion, or 90 cents per share, in the same quarter a year earlier and matches the consensus estimate of analysts polled by earnings tracker First Call.
At $22 billion, Philip Morris' (MO: up $0.19 to $49.98, Research, Estimates) fourth-quarter revenue rose 13.2 percent from $19.4 billion a year earlier and exceeded the $21.7 billion analysts generally had expected, according to the First Call survey.
Executives of Philip Morris, the world's largest tobacco company, said revenue and profits from tobacco products had improved primarily as a result of higher pricing.
"Our domestic tobacco business delivered strong market share and income gains, while our international tobacco business achieved higher volume and income despite unfavorable currency and economic weakness in certain markets," Geoffrey C. Bible, the company's chairman and CEO, said in a statement.
Although best known for its tobacco products, Philip Morris business extends well beyond that.
The company owns 84 percent of Kraft Foods (KFT: up $1.40 to $35.44, Research, Estimates), the world's No. 2 food company. Earlier this week, Kraft also unveiled a strong fourth-quarter profit report.
Philip Morris also owns Miller Brewing, the No. 2 U.S. brewer after Anheuser-Busch.
Looking ahead, Bible said the company is aiming for earnings growth ranging between 9 percent and 11 percent. By First Call's count, analysts' expectations currently are for a roughly 10 percent rise in earnings this year.
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Louis Camilleri | |
But for the better part of the year, another executive will be at the helm of the company and steaming toward that growth target.
Philip Morris announced Wednesday that its board of directors named Louis Camilleri as its new CEO, effective April 25. Bible will remain chairman until his retirement in August.
Camilleri, currently the company's chief financial officer, had been seen by many industry analysts as a strong candidate for the CEO post. He was named CFO in November 1996.
Prior to that, he served as president and CEO of the company's Kraft Foods International unit. He has served in various parts of the company since he joined Philip Morris Europe in 1978 as a business development analyst.
The transition had been widely expected.
Before the announcement was made Wednesday, Salomon Smith Barney issued a research report calling Camilleri "enormously well qualified for his upcoming appointment."
"In addition, we expect that he will scrutinize closely the most efficient corporate structure to maximize shareholder value," wrote Salomon tobacco analyst Martin Feldman.
Under Camilleri's watch, Philip Morris is likely to step up its merger and acquisition activity as a means of bolstering earnings growth and adding shareholder value, Feldman said. 
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