How Will Philip Morris Perform In Q2 2016?

Philip Morris is set to announce its second quarter results on July 19th, 2016.

Key Trends Expected In The Quarter:

1) High Exposure To A Strong Dollar

• As the company is US based, deriving all its revenues from international sales, it is highly exposed to the strength of the Dollar.
• The company derives 40% of its revenues from Europe, with 30% coming from the European Union.
• While the Dollar fell against the Euro during the past several months, as a result of the announcement of a delay in the interest rate hike by the Fed, it has risen significantly once the Brexit was declared.
• Moreover, the company is also exposed to the Australian Dollar and Canadian Dollar, which have been weak due to low commodity prices.
• Japanese Prime Minister Shinzo Abe has also driven the weakening of the Japanese Yen which has helped the exporters.

2) Popularity Of iQOS And Other Reduced Risk Products (RRPs)

• According to Philip Morris, RRPs are products that have the potential to reduce individual risk and population harm by users.
• The company has spent $2B to date working on its RRPs.
• The prospects of iQOS, its reduced risk HeatStick product, look bright and should foster growth in the future.
• Since its September launch in Japan, iQOS has grabbed 3.4% of the market share in Tokyo, and 2.4% in the overall expansion area there, with a conversion rate of over 50%.
• Besides Japan, iQOS has also been launched in key cities of Italy and Switzerland, and city launches have also been commenced in Bucharest, Lisbon, and Moscow.
• The company expects iQOS to be present in key cities in around 20 markets by the end of 2016.

Have more questions on Philip Morris? See the links below:

• Which Is A Better Dividend Bet – Altria Or Philip Morris?
• What Is The State Of The Illicit Cigarette Market In The European Union?
• How Will The Brexit Impact Philip Morris?
• What Effect Will The Plain Packaging Ruling In Canada Have On Philip Morris?
• What Effect Will A Tobacco Tax Hike Have In New Zealand?
• How Will Philip Morris Perform In 2016?
• Why Has Philip Morris’ Price Risen ~17% This Year Despite An Earnings Miss?
• How Did The Market Share For Philip Morris Change in Q1 2016 In EU And Its Key Markets, As Compared To Q1 2015?
• How Did The Revenue And Operating Companies Income In Each Region Change In Q1 2016, As Compared To Q1 2015?
• Philip Morris Misses Q1 Revenue And EPS Estimates
• Will Philip Morris Beat Expectations This Earnings Season?
• How Did Philip Morris Perform In The European Union, And Its Key Markets There, In 2015?
• How Did Philip Morris Perform In Russia, Given The Currency Headwinds And Excise Tax Rise?
• How Has Philip Morris Fared In Comparison To Its Peers?
• How Has Philip Morris’ Shipment Volume, By Brand, Changed Over The Past 3 Years?
• How Has Philip Morris’ Revenue And EBITDA Composition Changed In The Last 5 Years?
• How Will Philip Morris’ Revenue And EBITDA Change In The Next 3 Years?
• Philip Morris: Year 2015 In Review
• By What Percentage Did Philip Morris’ Revenue & EBITDA Change In The Last 5 Years?
• What is Philip Morris’ Fundamental Value Based On Expected 2016 Results?
• What is Philip Morris’ Revenue And EBITDA Breakdown?

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