Reynolds Reports Decrease in Earnings Per Share, Increases in Dividends

Source from:  tobaccofarmquarterly.com Wednesday, July 25, 2007  07/26/2007

Reynolds American Inc. reported a decrease in earnings per share of 13.4 percent for the second quarter, mostly based on high tax gains and inventory buildup in the previous year. The company, the parent of cigarette manufacturer R.J. Reynolds, reported a first half loss of EPS at 9.4 percent. The company also reported a dividend increase of 13.3 percent, to $3.40 per share. The report indicated share growth was attributed to the comp[any growth brands – Camel, Kool and Pall Mall. Those three brands reported a combined increase of 12.99 percent in the second quarter. The new Camel No. 9 brand has been well-received, and the test marketing of the new snus product is "making steady progress. Reynolds plans to expand its two-city test market to six cities. Grizzly, a moist-snuff product produced by Conwood, which was acquired by Reynolds in 2006, was reported as the growth leader in the product line with a market share of just 20.6 percent. It is the third-largest moist-snuff brand. Reynolds also refinanced a $1.55 billion loan to save interest and reported an upgrade in its credit rating. Enditem