(Reuters) – Cigarette maker Philip Morris International posted better-than-expected fourth quarter results, driven by strong demand for its smoking alternatives such as ZYN nicotine pouches, sending its shares up nearly 8% on Thursday.
The company’s smoking alternatives such as ZYN have enjoyed strong demand in recent years, in part because smokers have looked for alternative ways to get a nicotine buzz amid concerns about the health consequences of tobacco.
In January, the U.S. Food and Drug Administration gave PMI a formal license to market ZYN in the country, saying it poses lower risk of serious health conditions due to substantially lower amounts of harmful constituents.
In the quarter, oral inhalable smoke-free products volumes grew by 25% in cans from a year earlier, fueled by ZYN nicotine pouch growth in the U.S., where shipments reached nearly 165 million cans, representing a growth of nearly 42% from the prior year.
Philip Morris reported adjusted earnings of $1.55 per share in its fourth quarter ended Dec. 31, topping analysts’ expectations of $1.50 per share, as per data compiled by LSEG.
For the fourth quarter, its net sales rose 7.3% to $9.71 billion, compared with estimates of $9.44 billion.
The company also forecast adjusted annual earnings per share in the range of $7.04 to $7.17, above analysts estimate of $7.03.
(Reporting by Aamir Sohail in Bengaluru; Editing by Mrigank Dhaniwala)
Comments