Understand The Income Statement

Revenues continue to grow in Philip Morris International Inc. This is most likely due to the increasing volume of new product investments into smokeless tobacco. Revenue growth in 2021 was 9.4%, in 2022 1.1%, and in 2023 11%. Not quite consistent growth the last several years.

Operational margins have been decreasing notably due to higher working capital requirements: 2021, 65.01%; 2022, 61.53%; 2023 56.74%. In September, the Board of Directors approved a 2.4% increase in the quarterly dividend, to an annualized rate of $5.20 per share. This represented the sixteenth consecutive year in which they increased their dividend since becoming a public company in 2008.

Growth seems to be slow but very consistent considering the addictive nature of their products. With the cost of goods sold increasing from 10.03 B in 2021 to 11.23 B (11.9%) in 2022, and then to 12.86 B (14.5%) in 2023.

The company appears to have a focus on dividend growth for investors rather than growth for the company as they make their transition to a smoke-free portfolio.