Geoffrey C. Bible, chairman of the board and chief executive officer of Philip Morris Companies Inc. (NYSE: MO) told an audience of approximately 1,200 shareholders at the company's annual meeting yesterday that Philip Morris entered 2001 with momentum and expects "solid results again this year."

"Our strategies have served us well, and we intend to stay the course and adhere to them as our guideposts for the future," Mr. Bible said. "Our corporate infrastructure is powerful and sound, we are successfully managing our litigation challenges and we are changing the way we conduct our businesses in concert with societal expectations."

"While we are encouraged by the recent performance of our stock versus the S&P 500 and our peer companies, we believe that our shares remain undervalued, reflecting the concern of some investors about our litigation challenges," Mr. Bible said. "Although litigation will continue to pose a variety of challenges, we are demonstrating that the litigation is manageable over time and we will continue to take all appropriate actions and to allocate all the resources necessary to protect the interests of the company, its shareholders and its employees."

"The elements are thus in place for continued strength and growth for years to come. We are deeply committed to using our powerful financial performance to invest in the future and to build shareholder value," Mr. Bible said. During his remarks, he reiterated that the company expects to complete an initial public offering of common stock for Kraft Foods Inc. by the end of the second quarter of 2001.

Mr. Bible also pointed out that both Philip Morris Incorporated (PM USA) and Philip Morris International (PMI) are reaching out to critics and others regarding regulation of tobacco products. "We look forward to taking part in the process of creating a new and rational regulatory environment for the manufacture, sale and marketing of cigarettes - one that addresses health issues while respecting the principle of freedom of choice among adults," he said.

Regarding changes PM USA has made to meet societal expectations, Mr. Bible said, "Our dedication to addressing societal concerns about tobacco products can be seen in a range of initiatives that we have undertaken, particularly in the field of youth smoking prevention. We are working with retailers to comply with the tobacco settlement, and going far beyond the settlement in many areas as we continue to work with the state attorneys general to identify and solve problems related to underage tobacco use."

With approximately 80% of the shares entitled to vote represented at the meeting in person or by proxy, the 13 nominees named in the proxy statement were elected directors, the selection of PricewaterhouseCoopers LLP as independent accountants was approved and the six stockholder proposals were defeated.

With 2000 underlying operating revenues of $80.3 billion ($88.3 billion assuming Philip Morris owned Nabisco for all of 2000), the Philip Morris family of companies is the world's largest producer and marketer of consumer packaged goods. Philip Morris Companies Inc. has five principal operating companies: Kraft Foods Inc., Miller Brewing Company, Philip Morris International Inc., Philip Morris Incorporated (PM USA) and Philip Morris Capital Corporation.

For more information about Philip Morris Companies Inc., please visit the company's Web site at www.philipmorris.com

NOTE TO EDITORS: Preliminary voting results follow. The full text of Mr. Bible's business presentation is available on the company's Web site.

Preliminary Voting Results

2001 Philip Morris Annual Meeting

  • At the Annual Meeting of Stockholders, held at the Philip Morris Manufacturing Center in Richmond, Virginia, on April 26, 2001, 80% of the outstanding shares were represented in person or by proxy.
  • The 13 directors named in the company's proxy statement were elected to one-year terms. The directors received more than 99.5% of the shares voting.
  • The election of PricewaterhouseCoopers LLP as independent accountants was approved by more than 99.4% of the shares.
  • Each of the six stockholder proposals appearing in the proxy statement was defeated:

Proposal One: "Environmental Tobacco Smoke"

93.4% of the shares voting on the proposal voted against; 6.6% voted in favor.

Proposal Two: "A Proposal to Ensure that Tobacco Ads are Not Youth-Friendly"

92.2% of the shares voting on the proposal voted against; 7.8% voted in favor.

Proposal Three: "`Phase Out Genetically Engineered Food"

97.3% of the shares voting on the proposal voted against; 2.7% voted in favor.

Proposal Four: "Stop Funding Smoking Related Research Using Live Animals"

97.8% of the shares voting on the proposal voted against; 2.2% voted in favor.

Proposal Five: "Inform Consumers About the Risks of Smoking"

94.2% of the shares voting on the proposal voted against; 5.8% voted in favor.

Proposal Six: "Global Human Rights Standards"

93.8% of the shares voting on the proposal voted against; 6.2% voted in favor.