Philip Morris’ Profit Plunges

Philip Morris Cos. tallied the damage from the Year of the Cigarette Price War and confirmed the battle’s heavy toll on its earnings, but expressed optimism about its chances for a rebound. The New York-based tobacco and food conglomerate, which makes Marlboro cigarettes, Velveeta cheese products, Oscar Mayer meats and Miller beer, said its profit tumbled 71.7% in the fourth quarter and 37.4% for the year.

It cited lower domestic tobacco sales, a huge charge for closing plants and work force reductions, and a big accounting change.

For the three months ended Dec. 31, Philip Morris earned $339 million, or 38 cents a share, down from $1.2 billion, or $1.34 a share, a year earlier. Revenue slipped 1.4% to $14.7 billion from $14.9 billion in the fourth quarter of 1992.

The latest results reflected a $741-million pretax charge for the restructuring, which reduced earnings after taxes by $457 million. Excluding the restructuring charge, its earnings were down 33%.

For the year, Philip Morris earned $3.09 billion, or $3.52 a share, down from $4.94 billion, or $5.45 a share, in 1992. Revenue for the year rose 3% to $60.9 billion from $59.1 billion in 1992.