A stronger U.S. dollar and the growing popularity of e-cigarettes forced tobacco giant Philip Morris (NYSE:PM) to cut its earnings outlook for the full year on Thursday.
The company also said weak sales in Australia, which three years ago tightened advertising rules for cigarettes, contributed to the revision.
Philip Morris now expects to report a $4.87 to $4.97 per diluted share profit, compared to the forecast of $5.09 to $5.19 a share that it provided the market on May 7. The company also will take a $495 million charge during the year to shut down its Dutch production operations.
Bloomberg reported that CEO Andre Calantzopoulos told investors at a meeting Thursday in Lausanne, Switzerland, that Philip Morris faces “significant currency headwinds, an improving but weak macroeconomic environment in the European Union, and known challenges in Asia.”