This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Cigarette Maker Lorillard 3rd-quarter Profit Rises

MICHAEL FELBERBAUM

RICHMOND, Va. (AP) â¿¿ Cigarette maker Lorillard Inc. said Wednesday its third-quarter net income rose 6 percent, as higher prices helped offset a decline in the number of cigarettes sold.

The nation's third-biggest tobacco company said intense promotional activity drove the number of cigarettes it sold down about 2 percent during the quarter to about 10.1 billion cigarettes. Newport, its biggest brand, fell at about the same rate, but the Greensboro, N.C.-based company's share of the U.S. market grew to 0.2 percentage points to 14.4 percent. The company estimates that the industry as a whole sold 2.7 percent fewer cigarettes during the quarter.

Lorillard said its net income grew to $283 million, or $2.16 per share, for the three-month period ended Sept. 30, up from $267 million, or $1.94 per share, a year ago.

On an adjusted basis, earnings were $2.17 per share, missing Wall Street expectations of $2.23 per share.

Revenue excluding excises taxes rose 4.5 percent to $1.16 billion. Analysts polled by FactSet expected revenue of $1.2 billion.

Its shares fell $5.24, or about 4.5 percent, to $110.54 in morning trading Wednesday.

In a conference call with investors, Lorillard CEO Murray Kessler said even in the face of heavy competitive discounting of menthol cigarettes, "I never cease to be amazed by the strength of the Newport franchise." Still Kessler said the company anticipates the market to remain "challenged" in the short term.

Despite Lorillard's top competitors' continued efforts to grab some of the growing menthol market, Newport's share of the menthol market rose 0.3 points to 36.4 percent.

Most tobacco companies have been raising prices and cutting costs to keep profits up as the recession and declining demand cut into cigarette sales. Tax increases, smoking bans, health concerns and social stigma also have made the cigarette business tougher.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG

Markets

Chart of I:DJI
DOW 17,440.59 -127.94 -0.73%
S&P 500 2,067.64 -12.01 -0.58%
NASDAQ 5,039.7760 -48.8540 -0.96%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs