Philip Morris cuts profit estimate in 2014

The American cigarette manufacturer Philip Morris Redid the calculations of their profit projections and announced cut in estimates for this year. Presentation before meeting with analysts and investors on Thursday, the company unveiled expectation of profit between $ 4.87 to $ 4.97 per share for 2014, which shows a decline of 4.3% compared to previously expected range of $ 5.09 to $ 5.19.
The shareholders didn't like the reduction and the company's shares earlier fell 1% in the pre-market Nyse, New York Stock Exchange, listed at $ 88. The moodiness is due to the fact that most brokers worked with the roof of the previous forecast for the year, $ 5.19, second compilation made by Zacks Investment Research.
If the result designed in fact is confirmed, the figure would drop to 7.4% in comparison to 2013. Much of this low would come with expenses caused by the abandonment of production in Australia and the Netherlands — $ 0.25 per share, in total — and for losses with foreign exchange effect — which will, according to the accounts, the $ 0.61.
Demand
The worsening would also be caused by lower demand for cigarettes. The owner of Marlboro and L&M believes that the sector's sales volume fall of 2% to 3% this year, despite the numbers of United States and China. From 2015 onwards, this indent should be smaller, 1% to 2%, according to the company.
On his own performance, Philip Morris said that from next year the net revenue should rise from 4% to 6%, excluding the foreign exchange effect. Much of this high would be recorded by price adjustments, which, according to the company, will continue "in line with its historical series".
To try and dribble warmer demand by traditional cigarettes — amid new health alerts and increased taxes on the product —, the group tries to diversify its portfolio. One of the bets is the so-called "electronic cigarettes", which produces a smoke with water vapor. This year, the endeavor in the segment was the acquisition of British manufacturer Nicocigs.