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Segment Reporting
12 Months Ended
Dec. 31, 2016
Segment Reporting [Abstract]  
Segment Reporting
Segment Reporting:

PMI’s subsidiaries and affiliates are engaged in the manufacture and sale of cigarettes, other tobacco products and other nicotine-containing products in markets outside of the United States of America. Reportable segments for PMI are organized and managed by geographic region. PMI’s reportable segments are the European Union; Eastern Europe, Middle East & Africa; Asia; and Latin America & Canada. PMI records net revenues and operating companies income to its segments based upon the geographic area in which the customer resides.

PMI’s management evaluates segment performance and allocates resources based on operating companies income, which PMI defines as operating income, excluding general corporate expenses and amortization of intangibles, plus equity (income)/loss in unconsolidated subsidiaries, net. Interest expense, net, and provision for income taxes are centrally managed and, accordingly, such items are not presented by segment since they are excluded from the measure of segment profitability reviewed by management. Information about total assets by segment is not disclosed because such information is not reported to or used by PMI’s chief operating decision maker. Segment goodwill and other intangible assets, net, are disclosed in Note 3. Goodwill and Other Intangible Assets, net. The accounting policies of the segments are the same as those described in Note 2. Summary of Significant Accounting Policies.

Segment data were as follows:
 
For the Years Ended December 31,
(in millions)
2016
 
2015
 
2014
Net revenues:
 
 
 
 
 
European Union
$
27,129

 
$
26,563

 
$
30,517

Eastern Europe, Middle East & Africa
18,286

 
18,328

 
20,469

Asia
20,531

 
19,469

 
19,255

Latin America & Canada
9,007

 
9,548

 
9,865

Net revenues(1)
$
74,953

 
$
73,908

 
$
80,106



(1) Total net revenues attributable to customers located in Indonesia, PMI’s largest market in terms of net revenues, were $7.7 billion, $7.1 billion and $7.2 billion for the years ended December 31, 2016, 2015 and 2014, respectively. Total net revenues attributable to customers located in Germany were $7.1 billion, $7.2 billion and $8.3 billion for the years ended December 31, 2016, 2015 and 2014, respectively.

 
For the Years Ended December 31,
(in millions)
2016
 
2015
 
2014
Earnings before income taxes:
 
 
 
 
 
Operating companies income:
 
 
 
 
 
European Union
$
3,994

 
$
3,576

 
$
3,815

Eastern Europe, Middle East & Africa
3,016

 
3,425

 
4,033

Asia
3,196

 
2,886

 
3,187

Latin America & Canada
938

 
1,085

 
1,030

Amortization of intangibles
(74
)
 
(82
)
 
(93
)
General corporate expenses
(161
)
 
(162
)
 
(165
)
Less:
 
 
 
 
 
Equity (income)/loss in unconsolidated subsidiaries, net
(94
)
 
(105
)
 
(105
)
Operating income
10,815

 
10,623

 
11,702

Interest expense, net
(891
)
 
(1,008
)
 
(1,052
)
Earnings before income taxes
$
9,924

 
$
9,615

 
$
10,650



 
For the Years Ended December 31,
(in millions)
2016
 
2015
 
2014
Depreciation expense:
 
 
 
 
 
European Union
$
247

 
$
230

 
$
206

Eastern Europe, Middle East & Africa
150

 
163

 
212

Asia
184

 
184

 
278

Latin America & Canada
79

 
85

 
90

 
660

 
662

 
786

Other
9

 
10

 
10

Total depreciation expense
$
669

 
$
672

 
$
796


 
For the Years Ended December 31,
(in millions)
2016
 
2015
 
2014
Capital expenditures:
 
 
 
 
 
European Union
$
665

 
$
497

 
$
537

Eastern Europe, Middle East & Africa
223

 
147

 
216

Asia
180

 
185

 
272

Latin America & Canada
103

 
130

 
125

 
1,171

 
959

 
1,150

Other
1

 
1

 
3

Total capital expenditures
$
1,172

 
$
960

 
$
1,153



 
At December 31,
(in millions)
2016
 
2015
 
2014
Long-lived assets:
 
 
 
 
 
European Union
$
3,282

 
$
3,129

 
$
3,242

Eastern Europe, Middle East & Africa
866

 
743

 
836

Asia
1,916

 
1,743

 
1,838

Latin America & Canada
765

 
605

 
704

Total long-lived assets
6,829

 
6,220

 
6,620

Other
750

 
644

 
269

Total property, plant and equipment, net and Other assets
$
7,579

 
$
6,864

 
$
6,889



Long-lived assets consist of non-current assets other than goodwill; other intangible assets, net; deferred tax assets, investments in unconsolidated subsidiaries, and financial instruments. PMI's largest markets in terms of long-lived assets are Switzerland, Indonesia and Italy. Total long-lived assets located in Switzerland, which is reflected in the European Union segment above, were $0.9 billion, $0.9 billion and $1.0 billion at December 31, 2016, 2015 and 2014, respectively. Total long-lived assets located in Indonesia, which is reflected in the Asia segment above, were $0.8 billion, $0.7 billion and $0.7 billion at December 31, 2016, 2015 and 2014, respectively. Total long-lived assets located in Italy, which is reflected in the European Union segment above, were $0.7 billion, $0.4 billion and $0.3 billion at December 31, 2016, 2015 and 2014, respectively.

Items affecting the comparability of results from operations were as follows:

Asset Impairment and Exit Costs - See Note 5. Asset Impairment and Exit Costs for a breakdown of asset impairment and exit costs by segment.
Acquisitions and Other Business Arrangements - For further details, see Note 6. Acquisitions and Other Business Arrangements.