Excluding acquisitions, total shipment volume for cigarettes and OTP combined was up by 2.9%. OTP, which is primarily sold within the EU Region, is not significant to PMI’s net revenues.PMI’s market share in its top 30 OCI markets was 37.9%, up by 1.1 points. PMI’s market share grew in a number of markets, notably Algeria, Argentina, Australia, Belgium, Brazil, Colombia, Egypt, Indonesia, Italy, Poland, Russia, Spain, Thailand, Turkey, the United Kingdom and Ukraine. EUROPEAN UNION REGION (EU) 2012 Full-Year In the EU, net revenues decreased by 7.4% to $8.5 billion, due primarily to unfavorable currency of $716 million. Excluding currency, net revenues increased by 0.3%, mainly reflecting favorable pricing of $475 million, driven by France, Germany, Italy, the Netherlands, Poland, Spain and Switzerland, partly offset by unfavorable volume/mix of $445 million, predominantly due to a lower total market and share in Italy, France, Portugal and Spain. Operating companies income decreased by 8.2% to $4.2 billion, due primarily to unfavorable currency of $384 million. Excluding the unfavorable impact of currency, operating companies income increased by 0.2%, reflecting higher pricing and favorable asset impairment and exit costs compared to 2011, offset by: an unfavorable volume/mix of $380 million; higher manufacturing costs, mainly related to the mandated implementation of reduced cigarette ignition propensity standards which began in the fourth quarter of 2011; and higher marketing costs, principally reflecting marketing investment behind new brand launches and the roll-out of the “Be Marlboro” marketing campaign. Adjusted operating companies income decreased by 9.0%, as shown in the table below and detailed on Schedule 15. Adjusted operating companies income, excluding currency, decreased by 0.6%.
|EU Operating Companies Income ($ Millions)|
|Asset impairment & exit costs||(5||)||(22||)||(5||)||(45||)|
|Adjusted OCI Margin*||46.5||%||46.8||%||(0.3) p.p.||49.2||%||50.0||%||(0.8) p.p.|