Rothmans Hikes Dividend

Source from:  reportonbusiness.com The Canadian Press October 26, 2007 10/29/2007

Tobacco company Rothmans Inc. is hiking its quarterly dividend 16 per cent, to 35 cents a share, after second-quarter profit rose to $33.3-million from a year-ago $28.3-million. Toronto-based Rothmans said Friday its earnings for the quarter ended Sept. 30 amounted to 49 cents a share, compared with 42 cents per share a year ago. The company announced its regular dividend will rise to $1.40 on an annualized basis, from $120, while the quarterly payout rises to 35 cents from 30 cents. "This increase in our regular dividend reflects both the strength of the company's balance sheet and the strong financial performance that has been generated by our 60 per cent-owned subsidiary Rothmans, Benson & Hedges Inc.," CEO John Barnett said in a release. Rothmans Inc. "Following our record first quarter, RBH continued to generate strong performance this quarter, resulting in the improvement of all significant measures of financial performance including sales, earnings and cash flow when compared with the prior year." Sales at RBH, after excise duty and taxes, increased to $179.7-million from $165.2-million. RBH shipped a total of 2.8 billion equivalent cigarettes into the domestic market during the second quarter, unchanged from a year earlier. Mr. Barnett spoke out again about the impact of smuggled cigarettes. "The recently released study by the Canadian Tobacco Manufacturers Council detailing continued significant growth in illicit cigarettes within the Canadian marketplace demonstrates that our often expressed concerns relating to contraband product are justified," Mr. Barnett said. "While we remain confident in the ability of RBH's strong product offerings to compete within the tax-paid industry, the growth in contraband continues to have a negative effect on all legitimate industry participants including RBH." Enditem