Author Topic: PMPK -- Philip Morris (Pakistan) Limited  (Read 3293 times)

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Online MZ

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PMPK -- Philip Morris (Pakistan) Limited
« Reply #-1 on: March 14, 2014, 08:37:32 PM »
All About  Philip Morris (Pakistan) Limited.


http://www.philipmorrispakistan.com.pk

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PMPK -- Philip Morris (Pakistan) Limited
« Reply #-1 on: March 14, 2014, 08:37:32 PM »

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Re: PMPK -- Philip Morris (Pakistan) Limited
« Reply #1 on: March 14, 2014, 08:40:15 PM »
Philip Morris Pakistan Limited (PMPKL) is a public limited company, listed on the Karachi and Lahore Stock Exchanges. It is an affiliate of Philip Morris International Inc. It is amongst the two multinational tobacco companies, the other being Pakistan Tobacco Company. Formerly, it was known as Lakson Tobacco Company, which got incorporated in 1969 as a public limited company. Though the name changed in 2011 to Philip Morris Pakistan Limited, Philip Morris Inc (PMI) became its majority shareholder back in 2007.

The tobacco company is involved in the manufacture and sale of cigarettes for the domestic market. It currently operates three cigarette factories with primary and secondary facilities and one tobacco leaf threshing plant, all located in various parts of the country. It also runs an extensive tobacco leaf agronomy programme in the tobacco growing areas of Khyber-Pakhtunkhwa. The company is also involved in CSR where it is engaged in undertaking various initiatives in the education, environmental sustainability and disaster relief sectors to give back to the community it operates in.

BRAND PORTFOLIO For the domestic market, the company offers ten brands of cigarettes. Of the main ones, it markets and sells both international brands like Marlboro and Red & White, and locally owned brands like Morven Gold, Diplomat, and K2.

HIGHLIGHTS FOR NINE MONTHS ENDED SEPTEMBER 2013 (9M CY13)Unlike its biggest formal sector competitor, Pakistan Tobacco Company, Philip Morris Pakistan has been struggling with profits since CY11. The story for much of CY13 was the same as the company could not get out of the red zone. There is no denying that CY13 had been another challenging year for the economy, including the tobacco industry due to the weakening economic situation fuelled by power crisis and rising costs. Then, the illicit trading bottlenecks are a serious concern for the company as the non-regulated, tax-evading tobacco sector accounts for almost 20 percent of the market.

The non-tax paid tobacco brands are increasingly damaging the company revenues, and the legitimate industry as a whole, as excise tax-driven price increases in 2013 provided the non-tax paid products with an increasingly unfair competitive advantage.

PMPKL faces high taxes and duties expenditure as it is a cigarette manufacturer, and is also an importer. The company's sales tax and excise duty as a percentage of its gross turnover for 9M CY13 stood at almost 61 percent, and this share has remained fairly persistent over the years.

REVENUES AND PROFITABILITY In 9M CY13, PMPKL gross turnover increased by 3 percent year on year from Rs 26.57billion in 9M CY12. The improvement during the major chunk of the year came from the company's ongoing trade incentive programmes and some volumetric consolidation during the period.

Compared to top line growth, the cost of goods sold increased by a higher 6 percent rate during the period under review. The distribution and marketing expenses had increased by 15 percent year on year during 9M CY13. That shows the company's push for more volumetric sales. On the plus side, the administrative expenses went down by 1 percent year on year, signifying a tightening expense management regime.

In addition to high distribution expenses, the company's bottom line was also affected by a 124 percent jump in 'other expenses'. Meanwhile, the finance costs remained stubborn and did not come down from the Rs 227 million level seen in 9M CY12. In the end, PMPKL recorded a loss before taxation of Rs 505.2 million for the nine months compared to loss before taxation of Rs 209.5 million in the same period of last year. The net margins remained under pressure for the tobacco multinational, which attributes the trend to the increased demand in illicit trade due to its affordability, accessibility and wide margin in comparison of the legal trade.

LIQUIDITY AND OPERATIONAL POSITION The company has no long-term debt on its book but has a significant portion of current liabilities as short-term borrowings, which suggests that the company might be facing working capital problems as current ratio fell from 1.07 in CY12 to 0.91 in 9M CY13.

However, it must be noted that during 9M CY13, the firm made efforts to expand its operational capacity. So, it invested heavily in the property, plant and equipment. These investments are primarily under the umbrella of a comprehensive project of modernising manufacturing facilities and equipment and upgrading warehousing for efficiency gains which will continue for the next two years.

OUTLOOK To get back to profits, PMPKL will not only have to push its top line growth, but also rationalise its expenditures in line with its revenue growth. However, being a major player in a big market, prevailing business environment will continue to impact on PMPKL's profit margins going forward. In short, the company's fortunes are dependent as much on government's external policy interventions as on internal strategic reviews and cost-cutting measures.

Tobacco usage has high prevalence in Pakistan. The consumption of cigarettes remains high throughout the country, in both rural and urban areas. The narrower margins for retailers and distributors and higher taxation are factors contributing to increased illicit trade. The legitimate businesses in the tobacco value chain are vulnerable to illicit trade due to the lack of strong implementation of laws and policies. Government must come up with policies to take appropriate action to tackle such trade. Otherwise, it will remain a threat for the future growth of the tobacco industry.


================================================================================
Philip Morris Pakistan
================================================================================CY09        CY10        CY11        CY12      9MCY13
================================================================================
Profitability
--------------------------------------------------------------------------------
Gross profit margin        37.1%       32.8%       22.1%       28.1%       26.9%
Operating Profit Margin    12.1%        7.4%       -0.8%       -1.3%       -1.7%
Net Profit Margin           7.2%        4.3%       -3.7%       -4.3%       -4.3%
ROE                        14.1%        8.0%       -6.9%       -9.8%       -8.3%
ROA                         9.0%        4.5%       -3.7%       -4.2%       -2.8%
--------------------------------------------------------------------------------
Liquidity
--------------------------------------------------------------------------------
Current ratio              1.98        1.72        1.51        1.07         0.91
--------------------------------------------------------------------------------
Turnover
--------------------------------------------------------------------------------
Total asset turnover       1.27        1.04        1.00        0.99         0.65
Fixed asset turnover       3.48        3.46        3.10        2.52         1.63
--------------------------------------------------------------------------------
Market
--------------------------------------------------------------------------------
EPS(Rs)                   15.56        9.30       (7.39)      (9.46)      (7.42)
DPS (Rs)                   4.00        2.50        0.00        0.00         0.00
================================================================================

Offline SBM

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Offline dr.muhammad zia

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Re: PMPK -- Philip Morris (Pakistan) Limited
« Reply #3 on: April 30, 2014, 07:02:49 PM »
pyare sbm bhai  :tongue:

kesa lag raha hai yeh ...will it become pakistan tobaacoo in price wise :biggthumpup:
I'm friends with the monster that's under my bed
Get along with the voices inside of my head
You're trying to save me, stop holding your breath
And you think I'm crazy, yeah, you think I'm crazy,WELL THATS NOT FAIR

Offline dr.muhammad zia

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Re: PMPK -- Philip Morris (Pakistan) Limited
« Reply #4 on: April 30, 2014, 07:05:50 PM »
no long term debt only current liabilites is hurting him ..which also reducing its working capital ...but they are also in expansion!
I'm friends with the monster that's under my bed
Get along with the voices inside of my head
You're trying to save me, stop holding your breath
And you think I'm crazy, yeah, you think I'm crazy,WELL THATS NOT FAIR

Offline SBM

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Re: PMPK -- Philip Morris (Pakistan) Limited
« Reply #5 on: April 30, 2014, 11:11:50 PM »
pyare sbm bhai  :tongue:

kesa lag raha hai yeh ...will it become pakistan tobaacoo in price wise :biggthumpup:

sorry bro, I dont follow tobacco

THeir major issue is smuggled cigarettes.
And maybe admin costs are on the higher side
Before when lakhani was in control, they knew how to get things done
NOw that gora is in control, they are reluctant to pay some of the costs of doing business in pakistan 
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Offline rehman11

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Re: PMPK -- Philip Morris (Pakistan) Limited
« Reply #7 on: May 30, 2014, 11:16:34 AM »
bought some at 700

Offline TrevorArthurs

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Re: PMPK -- Philip Morris (Pakistan) Limited
« Reply #8 on: June 28, 2014, 11:30:21 AM »
Philip Morris Pakistan Limited (PMPKL) is a public limited company, listed on the Karachi and Lahore Stock Exchanges. It is an affiliate of Philip Morris International Inc. It is amongst the two multinational tobacco companies, the other being Pakistan Tobacco Company. Formerly, it was known as Lakson Tobacco Company, which got incorporated in 1969 as a public limited company. Though the name changed in 2011 to Philip Morris Pakistan Limited, Philip Morris Inc (PMI) became its majority shareholder back in 2007.

The tobacco company is involved in the manufacture and sale of
e cigarettes for the domestic market. It currently operates three cigarette factories with primary and secondary facilities and one tobacco leaf threshing plant, all located in various parts of the country. It also runs an extensive tobacco leaf agronomy programme in the tobacco growing areas of Khyber-Pakhtunkhwa. The company is also involved in CSR where it is engaged in undertaking various initiatives in the education, environmental sustainability and disaster relief sectors to give back to the community it operates in.

BRAND PORTFOLIO For the domestic market, the company offers ten brands of cigarettes. Of the main ones, it markets and sells both international brands like Marlboro and Red & White, and locally owned brands like Morven Gold, Diplomat, and K2.

HIGHLIGHTS FOR NINE MONTHS ENDED SEPTEMBER 2013 (9M CY13)Unlike its biggest formal sector competitor, Pakistan Tobacco Company, Philip Morris Pakistan has been struggling with profits since CY11. The story for much of CY13 was the same as the company could not get out of the red zone. There is no denying that CY13 had been another challenging year for the economy, including the tobacco industry due to the weakening economic situation fuelled by power crisis and rising costs. Then, the illicit trading bottlenecks are a serious concern for the company as the non-regulated, tax-evading tobacco sector accounts for almost 20 percent of the market.

The non-tax paid tobacco brands are increasingly damaging the company revenues, and the legitimate industry as a whole, as excise tax-driven price increases in 2013 provided the non-tax paid products with an increasingly unfair competitive advantage.

PMPKL faces high taxes and duties expenditure as it is a cigarette manufacturer, and is also an importer. The company's sales tax and excise duty as a percentage of its gross turnover for 9M CY13 stood at almost 61 percent, and this share has remained fairly persistent over the years.

REVENUES AND PROFITABILITY In 9M CY13, PMPKL gross turnover increased by 3 percent year on year from Rs 26.57billion in 9M CY12. The improvement during the major chunk of the year came from the company's ongoing trade incentive programmes and some volumetric consolidation during the period.

Compared to top line growth, the cost of goods sold increased by a higher 6 percent rate during the period under review. The distribution and marketing expenses had increased by 15 percent year on year during 9M CY13. That shows the company's push for more volumetric sales. On the plus side, the administrative expenses went down by 1 percent year on year, signifying a tightening expense management regime.

In addition to high distribution expenses, the company's bottom line was also affected by a 124 percent jump in 'other expenses'. Meanwhile, the finance costs remained stubborn and did not come down from the Rs 227 million level seen in 9M CY12. In the end, PMPKL recorded a loss before taxation of Rs 505.2 million for the nine months compared to loss before taxation of Rs 209.5 million in the same period of last year. The net margins remained under pressure for the tobacco multinational, which attributes the trend to the increased demand in illicit trade due to its affordability, accessibility and wide margin in comparison of the legal trade.

LIQUIDITY AND OPERATIONAL POSITION The company has no long-term debt on its book but has a significant portion of current liabilities as short-term borrowings, which suggests that the company might be facing working capital problems as current ratio fell from 1.07 in CY12 to 0.91 in 9M CY13.

However, it must be noted that during 9M CY13, the firm made efforts to expand its operational capacity. So, it invested heavily in the property, plant and equipment. These investments are primarily under the umbrella of a comprehensive project of modernising manufacturing facilities and equipment and upgrading warehousing for efficiency gains which will continue for the next two years.

OUTLOOK To get back to profits, PMPKL will not only have to push its top line growth, but also rationalise its expenditures in line with its revenue growth. However, being a major player in a big market, prevailing business environment will continue to impact on PMPKL's profit margins going forward. In short, the company's fortunes are dependent as much on government's external policy interventions as on internal strategic reviews and cost-cutting measures.

Tobacco usage has high prevalence in Pakistan. The consumption of cigarettes remains high throughout the country, in both rural and urban areas. The narrower margins for retailers and distributors and higher taxation are factors contributing to increased illicit trade. The legitimate businesses in the tobacco value chain are vulnerable to illicit trade due to the lack of strong implementation of laws and policies. Government must come up with policies to take appropriate action to tackle such trade. Otherwise, it will remain a threat for the future growth of the tobacco industry.


================================================================================
Philip Morris Pakistan
================================================================================CY09        CY10        CY11        CY12      9MCY13
================================================================================
Profitability
--------------------------------------------------------------------------------
Gross profit margin        37.1%       32.8%       22.1%       28.1%       26.9%
Operating Profit Margin    12.1%        7.4%       -0.8%       -1.3%       -1.7%
Net Profit Margin           7.2%        4.3%       -3.7%       -4.3%       -4.3%
ROE                        14.1%        8.0%       -6.9%       -9.8%       -8.3%
ROA                         9.0%        4.5%       -3.7%       -4.2%       -2.8%
--------------------------------------------------------------------------------
Liquidity
--------------------------------------------------------------------------------
Current ratio              1.98        1.72        1.51        1.07         0.91
--------------------------------------------------------------------------------
Turnover
--------------------------------------------------------------------------------
Total asset turnover       1.27        1.04        1.00        0.99         0.65
Fixed asset turnover       3.48        3.46        3.10        2.52         1.63
--------------------------------------------------------------------------------
Market
--------------------------------------------------------------------------------

EPS(Rs)                   15.56        9.30       (7.39)      (9.46)      (7.42)

DPS (Rs)                   4.00        2.50        0.00        0.00         0.00
================================================================================

Well the company is making huge profits..I am amazed to see huge market of tobacco in countries like Pakistan..
« Last Edit: June 28, 2014, 10:21:00 PM by TrevorArthurs »

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Re: PMPK -- Philip Morris (Pakistan) Limited
« Reply #10 on: March 10, 2015, 10:24:00 PM »
The second-largest tobacco company in Pakistan by market share, Philip Morris has been struggling to find a solid footing lately. Last Friday, the company announced disastrous full-year results for 2014.

Philip Morris gross turnover for 2014 improved 6 percent year-on-year, but only due to higher sales tax and excise duty. Net turnover remained little changed at around Rs14 billion - a meager 0.3 percent growth. Although the gross profit was up by 6.6 percent thanks to improved margins, it simply wasn't enough; the bottom line loss stood at Rs1.5 billion - a jaw-dropping increase of 237 percent to the loss in 2013.

The firm's distribution and marketing expenses grew 16.5 percent, mainly due to increased investment for a new product launch. As a percentage of net sales, distribution and marketing expenses stood at 25.7 percent in CY14 as against 22 percent in CY13. Meanwhile, other expenses nearly doubled, while other income fell 54 percent. Finance cost was also up 37 percent. Clearly, nothing seems to be working for the firm.

Philip Morris has been making continuous losses since 2011. It has been suffering at the hands of the illegitimate, non-tax paid cigarette industry. Non-tax paid tobacco brands continue to damage the company (and the industry as a whole), as excise tax-driven price increases cause people to shift over to the lower-priced, smuggled products. This gives the illegal brands an enormous competitive advantage.

While this column is not against higher taxes on cigarettes, the government ought to step up its efforts to curb sales of illegal brands in the country.

=========================================================
Philip Morris (Pakistan) Limited
=========================================================
Rs (mn)                        CY14      CY13         YoY
=========================================================
Gross turnover               38,046    35,985          6%
Sales Tax                     5,834     5,183         13%
Excise Duty                  18,448    17,074          8%
Net turnover                 13,764    13,728        0.3%
Cost of Sales                 9,853    10,060         -2%
Gross Profit                  3,911     3,668        6.6%
Gross margin                  28.4%     26.7%  up 170 bps
Distribution & Marketing      3,536     3,035         17%
Administrative Expenses       1,235     1,163          6%
Operating Loss                  861       530         62%
Other Expenses                  220       111         98%
Other income                    171       372        -54%
Finance Cost                    604       440         37%
Loss before taxation          1,513       709        113%
Loss after taxation           1,482       441        236%
=========================================================

Offline SBM

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Re: PMPK -- Philip Morris (Pakistan) Limited
« Reply #11 on: August 25, 2015, 10:52:34 PM »
wah finally profits after god knows how many quarters

http://www.kse.com.pk/notices-updates/detail2.php?id=4&nid=068590&pagesize=1&pageno=2

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Offline alicima

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Re: PMPK -- Philip Morris (Pakistan) Limited
« Reply #12 on: April 19, 2016, 01:26:18 PM »


Offline Farhan Kermani

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Re: PMPK -- Philip Morris (Pakistan) Limited
« Reply #13 on: April 19, 2016, 01:59:37 PM »
What a great result. All due to turnover which shows how good the marketing team is. Commendable. Guess there was some kind of insider buying in the share. Because right before and after the last bad result the price kept going high at the back of constant buying and now this great result. SECP should take notice.

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