Philip Morris : 27.03.2024 Philip Morris ČR a.s. achieved solid results in 2023, despite challenging operating environment

Press release

Philip Morris ČR a.s. achieved solid results in 2023, despite challenging operating environment

Prague, March 27, 2024. Philip Morris ČR a.s. published financial and economic results for the year 2023. Consolidated revenues (excluding excise tax and VAT) reached CZK 20.6 billion, which is 1.8% lower than prior year (or 1.2% excluding currency impact). Consolidated net profit reached CZK 3.3 billion, which is 8.0% lower than prior year (or 6.6% excluding currency impact). Total shipments of smoke free products and combustible products in the Czech Republic and Slovakia reached 10.1 billion units. This represents a 9.7% decrease in comparison to prior year, predominantly driven by the performance of cigarettes due to a decline of the market. Smoke free products volume remained broadly unchanged.

"Our results demonstrate solid foundaons of our business, that faced a combinaon of external negave factors in 2023. Despite the macroeconomic condions, inflaonary pressures and uncertainty, which affect the purchasing power of consumers, but also with regard to the growing compeve environment not only in the offer of classic cigarees and newly also smoke-free alternaves, our company has demonstrated remarkable resilience," says Andrea Gontkovičová, Chairman of the Board of Directors and Managing Director of Philip Morris ČR a.s., a subsidiary of Philip Morris Internaonal (PMI), which covers business in the Czech Republic and Slovakia. "Aſter several volale years, we could observe a gradual return to the overall stabilizaon of the market, especially in the second half of the last year. The posive news is that sales of consumables for our smoke-free alternaves have not changed year-on-year, even despite the ban on refills with a characterisc flavor in the Czech Republic in October," adds Andrea

Gontkovičová.

The total combined market of cigarees and heated tobacco products in the Czech Republic in 2023 recorded a year-on-year decrease of 10.3% to a total of 15.6 billion units, while in Slovakia it decreased by 4.0% to 7.1 billion units. Total shipments of Philip Morris ČR, a.s. and Philip Morris Slovakia s.r.o. then followed the market trend, registering a year-on-year decline of 9.7% to 10.1 billion units. Despite this, the company's total revenues decreased only by 1.8% to a total of CZK 20.6 billion. Philip Morris remains the leader in both markets with an esmated market share of 39.6% in the Czech Republic and 53.4% in Slovakia.

In the Czech Republic, the company's total combines shipments decreased by 11.1% to 6.3 billion units. Domesc sales of smoking tobacco products fell by 0.7 billion units compared to 2022 to 4.1 billion units, while sales of smoke-free alternaves reached 2.3 billion units, remaining at the previous year's level. The organic growth of this porolio was parally slowed by trade inventory movements at the end of 2022 and effects of characterisc flavor ban on the sale of heated tobacco consumables starng in the middle of October.

In Slovakia, the company's total combined shipments decreased by 7.3% to 3.8 billion units. Domesc combusble shipments slightly decreased year-on-year by 0.3 billion units to 2.7 billion units, while shipments of smoke-free alternaves remain flat at 1.1 billion units.

Also in 2023, the Company focused mainly on the development of the offer of smoke-free alternaves, in the Czech Republic mainly in the category of electronic cigarees. In February, the VEEBA disposable

cigaree (rebranded to VEEV NOW in August) was launched on the market, and in the summer, the brand new VEEV ONE device arrived on the market with an innovave, aracve design and improved features. In autumn, another novelty was introduced to the Czech market as one of the first in the world - zero-tobacco consumables for IQOS ILUMA named LEVIA. Another novelty was the introducon of a new generaon of lil SOLID EZ device, which replaces the original lil SOLID 2.0.

"This year will mark ten-year anniversary of PMI spearheading nicone revoluon with launch of smoke-free alternaves. I am proud that Philip Morris ČR a.s. has been important contributor to this journey since the year 2017. Both Czechia and Slovakia are one of the few markets in the world that benefits from almost the enre porolio of smoke-free products. At the same me, we are oſten one of the first to bring the latest innovaons from the PMI workshop to our markets. We are therefore preparing other noveles in our porolio of smoke-free alternaves for our adult customers this year as well," says Andrea

Gontkovičová.

***

Media Contact:

Vojtěch Severýn Communicaons Managervojtech.severyn@pmi.com ***

Philip Morris ČR a.s.

Philip Morris ČR a.s. is a subsidiary of Philip Morris Internaonal (PMI), a leading internaonal tobacco company working to deliver a smoke-free future. In addion to tradional tobacco products, on the Czech market Philip Morris ČR a.s. distributes the IQOS ILUMA heang tobacco device and compable TEREA tobacco and LEVIA non-tobacco consumables, the lil SOLID tobacco heang device with Fiit tobacco consumables, the VEEV ONE e-cigaree, VEEV NOW disposable-vapour device and other related accessories. Philip Morris ČR a.s., which has been operang in the Czech Republic since 1992 and employs more than 1,100 people, is listed on the Prague Stock Exchange (BCPP). At the same me, it owns a 99% business share in the subsidiary Philip Morris Slovakia s.r.o., registered in the Slovak Republic. For more than 30 years, the company has contributed to helping various charitable projects, including projects involving the support of social programs aimed at improving living condions in local communies. You can find more informaon at www.philipmorris.cz, including the annual report for 2023.

Philip Morris Internaonal: Delivering a Smoke-Free Future

Philip Morris Internaonal (PMI) is a leading internaonal tobacco company, acvely delivering a smoke-free future and evolving its porolio for the long term to include products outside of the tobacco and nicone sector. The company's current product porolio primarily consists of cigarees and smoke-free products. Since 2008, PMI has invested $12.5 billion to develop, scienfically substanate and commercialize innovave smoke-free products for adults who would otherwise connue to smoke, with the goal of completely ending the sale of cigarees. This includes the building of world-class scienfic assessment capabilies, notably in the areas of pre-clinical systems toxicology, clinical and behavioral research, as well as post-market studies. In 2022, PMI acquired Swedish Match - a leader in oral nicone delivery - creang a global smoke-free champion led by the companies' IQOS and ZYN brands. The U.S. Food and Drug Administraon has authorized versions of PMI's IQOS Plaorm 1 devices and consumables and Swedish Match's General snus as Modified Risk Tobacco Products. As of December 31, 2023, PMI's smoke-free products were available for sale in 84 markets, and PMI esmates that approximately 20.8 million adults around the world had already switched to IQOS and stopped smoking. Smoke-free products accounted for approximately 37% of PMI's total full-year 2023 net revenues. With a strong foundaon and significant experse in life sciences, PMI announced in February 2021 its ambion to expand into wellness and healthcare areas and, through its Vectura Fern Pharma business, aims to enhance life through the delivery of seamless health experiences.

For more informaon, please visit www.pmi.comand www.pmiscience.com

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Philip Morris CR a.s. published this content on 26 March 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 March 2024 07:10:05 UTC.