The impact of the federal excise-tax increase on retail cigarette dealers made for a bumpy first quarter for Lorillard ( LO), the maker of Newport cigarettes. The company posted a 5.7% gain, but fell short of analysts' expectations. Its quarterly earnings rose to $184 million, or $1.09 s share, compared with $174 million, or $1 a share, a year ago. Analysts expected earnings of $1.15 a share. Sales remained relatively flat at $917, compared with $921 million last year, as higher prices and lower costs offset decreased volumes from the tax increase. Volume was constrained by tobacco retailers and wholesalers who cut their orders ahead of a one-time federal tax on their inventory. Tobacco sellers had to pay a "floor" tax of 62 cents per pack on inventory they had stocked before a 62-cent-per-pack retail sales tax went into effect April 1. While rival Altria ( MO)also said last week that it saw diminished first-quarter profit due to the increased tax, Philip Morris International ( PM) posted higher-than-expected earnings, buoyed by its Asian, Latin American and Canadian markets. Philip Morris also reaffirmed its full-year outlook. The next hurdle for cigarette makers: a possible ban on cigarette sales in pharmacies in New York and San Francisco.