|
Philip Morris sees shortfall
|
 |
June 28, 1999: 8:11 p.m. ET
Expects earnings to slip to $3.30-share on declining demand for its cigarettes
|
NEW YORK (CNNfn) - Philip Morris Cos., the world's largest tobacco company, Monday said it is expecting earnings of $3.30 a share in 1999, slightly less than analysts' forecasts, on declining international sales of its brands of cigarettes.
Philip Morris was expected to earn $3.32 a share, according to the average estimate of analysts polled by research firm First Call Corp. The producer of Marlboro cigarettes, Kraft cheeses and Miller beers said it is expecting a 4 percent decline in overseas tobacco volume this year because of slumping economies in Eastern Europe and Russia, and the rising value of the U.S. dollar.
Speaking in New York to analysts and investors, Philip Morris president Geoffrey Bible said that once the company's tobacco businesses re-emerge from this year's slump, earnings for the New York-based company should reach 11 percent to 13 percent through 2003. Bible also said the company should generate some $55 billion in cumulative operating cash flow through the same period, which it will use to "enhance shareholder value."
The projections, which also included other areas of Philip Morris's business, were the first to be shared with the investing public in more than four years. Philip Morris hasn't provided a detailed report of its operations or outlook since March 1995, when it was besieged with smoking-related lawsuits and settlement talks with local governments.
Some of Philip Morris's expected profit will come from higher tobacco sales and cost savings associated with producing them in 2000 and beyond. International tobacco profit will likely be unchanged this year, though volumes may rise 1 percent to 3 percent in 2000, with a profit increase of 7 percent to 9 percent.
At its Kraft food business unit, domestic sales may rise 2 percent to 3 percent this year, with a 6 percent to 7 percent rise in profit, the company said. Kraft's international volumes, meanwhile, are expected to rise 2 percent to 3 percent in 2000 and by the same pace in the following year.
Volume at its Miller Brewing unit may rise 1 percent to 3 percent in 1999, Philip Morris said, with profit gaining 16 percent to 18 percent.
Philip Morris ended the day Monday down 3/16 at 41. 
|
|
|
|
|
|
Philip Morris
|
Note: Pages will open in a new browser window
External sites are not endorsed by CNNmoney
|
|
|
|
 |
|
