UPDATE 4-Philip Morris offers weak outlook, shares slip

* EPS 71 cents vs Wall St 62 cents view

* Sees 2009 EPS of $2.85 to $3 vs analysts' $3.32 view

* Stronger dollar to hurt full-year performance

* Shares fall 3 percent (Adds CEO, analyst comments; updates stock move, adds byline)

By Ben Klayman

CHICAGO, Feb 4 (Reuters) - Philip Morris International Inc (PM.N) said 2009 earnings would be well below analysts' forecasts due to the stronger U.S. dollar, driving shares of the world's largest publicly traded tobacco company down over 3 percent.

The company posted a fourth-quarter profit that topped Wall Street expectations on Wednesday, but investors focused on its earnings forecast. Philip Morris said it expects 2009 profit per share in the range of $2.85 to $3.00, compared with the average Wall Street view of $3.32.

The outlook, excluding 80 cents on a hit from the stronger dollar, would represent an increase from 2008's results of 10 to 14 percent.

Morningstar analyst Phil Gorham said the company's performance in the European Union was weak, particularly in the fourth quarter, and that is bad sign for 2009.

"The volume declines seen in the EU are a taste of things to come in '09 with the weaker economy and higher prices," he said. "The firm has real short-term headwinds."

Chairman and Chief Executive Louis Camilleri said on a conference call that there is no evidence of a shift in consumer habits toward cheaper brands in emerging markets, which drove the company's performance in the quarter.

"However, recognize that the year has barely started and the global economic crisis is still unfolding and, accordingly, there is no certainty that these trends will be sustained," he said.

"Regretfully, currency will cast a dark shadow on our financial results should exchange rates remain at current levels," Camilleri added.

Philip Morris was spun off from Altria Group Inc (MO.N) in 2008 to give shareholders a straight play in the global cigarette market, uncoupling it from the shrinking U.S. cigarette market. But the company has been buffeted by the gyrations of the dollar.

RESULTS AHEAD OF EXPECTATIONS

Goldman Sachs analyst Judy Hong said the currency impact was significantly greater than her estimate at 45 cents per share, and also was stronger than the market had expected.

However, Hong added that the company's operating results were of a high quality, driven by favorable pricing and volume benefits in developing markets.

Philip Morris's fourth-quarter profit fell to $1.45 billion, or 71 cents a share, from $1.57 billion, or 74 cents a share, a year earlier. The rising dollar offset the benefit of price increases.

Net revenue rose 3.6 percent from last year to $6.12 billion, excluding excise taxes. The rising dollar cut 4.9 percentage points from the sales increase.

Analysts, on average, had forecast the maker of Marlboro cigarettes would earn 62 cents a share on revenue of $5.54 billion, according to Reuters Estimates.

Year-earlier results are on a pro forma basis, as if the company were independent then.

Philip Morris shipped 217.2 billion cigarettes in the fourth quarter, up 2 percent from a year earlier.

Camilleri said Philip Morris is confident it can achieve 2009 volume growth of 1 to 2 percent and net revenue growth of 4 to 6 percent. He said cash flow should exceed the company's net income performance.

He also expects 2009 share buybacks to be in line with the level last year, when the company spent $5.4 billion.

Also on Wednesday, Philip Morris said it has an agreement to buy the rights to the Petteroes fine cut tobacco trademark globally and other cigarette trademarks sold mostly in Norway and Sweden. The brand had net revenue, excluding excise taxes, of about $54 million in 2008.

The deal is expected to close in the first quarter and is projected to modestly add to net earnings in 2009.

Philip Morris shares were down $1.33 at $36.99 in afternoon trading on the New York Stock Exchange, off an earlier low at $35.15. The Dow Jones U.S. Tobacco Index .DJUSTB fell 2.5 percent. (Reporting by Ben Klayman; Editing by Matthew Lewis and Gerald E. McCormick)