The cigarette maker reported fourth-quarter earnings of $1.25 per share on revenue of $7.5 billion, a 9.6% decline from the previous year. Analysts were expecting the company to report earnings of $1.17 per share on revenue of $7.4 billion.
"We closed out a challenging year with a robust financial and strategic performance across the business. Excluding inventory movements largely associated with heated tobacco unit volume in Japan, our total volume variance was flat -- our best annual performance since 2012 -- underpinned by a near doubling of global in-market sales of heated tobacco units," CEO André Calantzopoulos said.
While revenue increased year over year, operating income and profits fell as cigarette and heated-tobacco-unit shipment fell 4.6% year over year.
For 2019, the company expects earnings to increase at least 5.7% to $5.37 a share. Analysts are expecting the company to report earnings of $5.29 a share.
"The underlying strength of our combustible tobacco business remains intact and our reduced-risk products are the catalysts to accelerate our business growth and secure the long-term future of our company and the sustainability of our earnings and dividend growth," Calantzopoulos said.