Philip Morris International, the largest private tobacconist across the globe, announced last week its Q2 Profits report, posting higher-than-forecasted earnings prompted by an 8-percent-growth in cigarette shipments and sales boost in Japan where smokers started to stock up anticipating huge tax increases scheduled for October 1, 2010.

The only region where cigarettes shipments declined was Western Europe, with 6.2% reduction mainly because of economic downfall in Spain and Greece and tax increases in Germany and the UK, according to PMI report.

The major sales growth was reported in Asian and African emerging markets and in Russia, and according to the forecasts the shipments are likely to keep growing.

Louis Camilleri, PMI’s CEO said that higher-than-expected performance was reached due to the company’s large portfolio of supreme-quality tobacco products. The combined market share of PMI ten best-selling international brands went up by 3.6%. As it was expected, the company’s major low-cost products, such as Bond Street and Red & White as expected showed impressive performance, due to increased demand for lower-priced cigarettes among economic challenges.

Nevertheless, the major premium brands, such as Marlboro, Virginia and Parliament, also performed well. Philip Morris International’ flagship brand Marlboro sales dropped only 0.5% as sales growth in Asian region, Middle East and North Africa was offset by volume declines in Western Europe. Another key premium brand Parliament showed a 2.3% percent increase during the second quarter, following large volume growths in Japan and Russia, which compensated slight drops in other markets.

PMI major middle-value brand L&M posted a solid sales volume, mainly due to increasing demand in more than 30 markets including Egypt, Thailand, Nigeria, the Netherlands, and other countries, which offset less successive sales in Eastern Europe.

Chesterfield's performance was solid as well with a 6.2% volume growth compared to the same period last year, though it dropped 2.1% in Spain, one of the brand’s principal markets.

And finally, Bond Street showed the best performance in the PMI portfolio, as smokers, who preferred PMI premium and mid-price brands, now turn to the company’s low-cost brands. In addition, Bond managed to win customers from other competitors in the same price segment.

Philip Morris International reported that Russia become the company’s most successful market this quarter, as the combined market share added 0.2 percentage points to its market-leading share of 25.5 percent. The growth was prompted by impressive performance of low-priced Bond Street, which volumes keep growing across the country, and mid-value L&M and Chesterfield, which performed well in Russia’s major cities. At the same time Parliament share also went up a little, indicating that the Russian tobacco market is stabilizing after a huge drop registered in 2008.

Overall, the Philip Morris International CEO admitted that the company recorded higher-than-forecasted earnings and raised its year-end profits forecast.