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Philip Morris International Inc. (NYSE:PM), a prominent tobacco industry player with a market capitalization of $267 billion and strong EBITDA of $16.24 billion, announced the issuance of $2.5 billion in new notes across four different tranches, according to a recent SEC filing. According to InvestingPro, the company maintains a moderate debt level and has earned a "GOOD" overall financial health score. The company issued $400 million in Floating Rate Notes due 2028, $750 million in 4.125% Notes due 2028, $750 million in 4.375% Notes due 2030, and $600 million in 4.875% Notes due 2035.
The notes were issued under an existing indenture with HSBC Bank USA, National Association, as trustee. The transaction was facilitated through a Terms Agreement with Barclays (LON:BARC) Capital Inc., Mizuho (NYSE:MFG) Securities USA LLC, SMBC Nikko Securities America, Inc., Santander (BME:SAN) US Capital Markets LLC, and Standard Chartered (LON:STAN) Bank, acting as representatives of the underwriters.
The proceeds from the offering are intended for general corporate purposes, which may include repaying outstanding commercial paper, refinancing existing debts, or meeting working capital requirements. This debt management strategy appears prudent given the company’s current ratio of 0.79 and total debt-to-capital ratio of 0.16, as reported by InvestingPro, which offers comprehensive financial analysis through its Pro Research Reports covering 1,400+ top US stocks. The company has not specified any redemption plans for its outstanding U.S. dollar-denominated 3.375% Notes due 2025 in this filing.
The newly issued Floating Rate Notes will bear interest based on the Compounded SOFR plus 0.83%, payable quarterly starting July 28, 2025. The 2028, 2030, and 2035 fixed-rate notes will pay semi-annual interest, with the first payment due on October 28, 2025, for the 2028 Notes and October 30, 2025, for the 2030 and 2035 Notes.
Philip Morris International Inc. has ensured that the notes will be senior unsecured obligations, ranking equally with all its existing and future senior unsecured indebtedness. The offering was made through a Prospectus Supplement dated April 28, 2025, under the company’s Registration No. 333-269690.
Several underwriters involved in the transaction have provided various financial services to Philip Morris in the past and may continue to do so in the future. The company’s strong financial position is evidenced by its impressive dividend track record, having maintained dividend payments for 18 consecutive years. Discover more insights about PM’s financial health and growth potential with InvestingPro, which offers 16 additional exclusive ProTips and detailed metrics for informed investment decisions. They have received customary fees and expenses for their services and are also lenders under Philip Morris’s credit facilities. Additionally, they may act as dealers for the company’s commercial paper programs and engage in derivative transactions with Philip Morris and its subsidiaries.
This news is based on a press release statement.
In other recent news, Philip Morris International Inc. reported a strong performance for the first quarter of 2025, with earnings per share (EPS) of $1.69, surpassing the forecast of $1.60. The company also exceeded revenue expectations, reporting $9.3 billion against a forecast of $9.06 billion. Stifel analysts increased their price target on Philip Morris shares to $186, maintaining a Buy rating, following the company’s announcement of significant organic revenue and profit growth. The tobacco giant reported over 10% organic revenue growth, including a 16% rise in organic operating profit and a 17% growth in constant currency EPS. UBS analyst Faham Baig upgraded Philip Morris’s stock rating to Neutral from Sell, raising the price target to $170, citing the company’s robust first-quarter performance and increased full-year 2025 EPS guidance. The positive outlook is attributed to the strength in the smoke-free product line’s gross margins. These developments reflect a promising trajectory for Philip Morris, supported by its strategic focus on smoke-free products and strong market positioning.
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