reported earnings on Tuesday that met expectations due to the solid performance of the company's main divisions.
The New York-based tobacco and food conglomerate is on track to meet full-year growth targets, said Geoffrey Bible, chairman of the board and chief executive of Philip Morris, in a statement.
For the first quarter, net earnings rose 6% to $2.07 billion, or 89 cents a diluted share, from $1.96 billion, or 80 cents a share, a year earlier. The numbers matched the consensus estimate of analysts polled by
First Call/Thomson Financial
Operating revenue rose 4% to $20.26 billion from $19.44 billion a year ago.
All figures include sales of products that would normally have occurred in January 2000 but were made in 1999 in anticipation of potential catastrophes relating to the year 2000 date change. The figures also exclude $99 million taken in charges for fired employees.
Philip Morris, the largest maker of cigarettes in the world, controls half of the U.S. market with brands like Marlboro, Virginia Slims, Benson & Hedges and Parliament. Underlying operating companies income for the domestic tobacco business grew 6.5% to $1.1 billion, due mostly to higher pricing and increased volume. Shipment volume of 52.8 billion cigarettes grew 7.1%, while the industry volume of 102.3 billion was up 4.6%. Marlboro's market share stands at 37%.
Internationally, underlying operating companies income grew 4.1% to $1.5 billion, with volume gains in western Europe, Russia, Japan and Asia and higher pricing in many markets offsetting volume declines in central and eastern Europe.
Less than half of Philip Morris' sales -- 37%, or $7.5 billion -- was derived from the food and beer subsidiaries, which include
, the largest U.S. food company and the maker of Jell-O and Oscar Mayer products; and
, the No. 2 U.S. beer maker behind
The underlying operating companies income of the North American food business rose 6.1% to $893 million, driven by higher volume, continued productivity savings and favorable commodity costs. Income from the international food business grew 6.6% to $258 million, reflecting higher coffee, confectionery, cheese and grocery volume and lower commodity costs, offset by an unfavorable currency exchange.
Income from the beer business grew 12.5% to $153 million, driven by the impact of contract brewing, acquired brands and higher pricing.
Shares of Philip Morris were down 3/16, or 1%, at 21 1/16 in midday Tuesday trading. (Philip Morris finished down 9/16, or 2.7%, at 20 11/16.)