Lorillard volume shipments down

Lorillard’s domestic-market wholesale cigarette shipments during the three months to the end of June, at 9,977 million, were down by 2.8 percent on those of the second quarter of 2013, 10,262 million.
Shipments of Newport were down by 1.9 percent to 8,524 million, while shipments of Kent and True, Lorillard’s other full-price brands, were down by 13.9 percent to 35 million and by 14.8 percent to 37 million, respectively.
In total, full-price brand shipments were down by 2.1 percent to 8,596 million.
Shipments of price/value brands were down by 6.9 percent to 1,381 million, with shipments of Old Gold down by 11.3 percent to 103 million and those of Maverick down by 6.6 percent to 1,277 million.
Lorillard’s shipments to Puerto Rico and U.S. possessions were down by 38.6 percent to 114 million; so domestic and overseas shipments, taken together, were down by 3.4 percent to 10,092 million.
Lorillard’s share of the U.S. domestic market during the second quarter, at 15 percent, was increased by 0.2 of a percentage point on that of the second quarter of 2013. Newport’s share was up by 0.3 of a percentage point to 12.8 percent.
The menthol cigarette share of the total U.S. market increased by 0.2 of a percentage point to 31.6 percent, and Lorillard’s share of the menthol segment increased by 0.3 of a percentage point to 40.3 percent. Newport’s share of the menthol segment rose by 0.2 of a percentage point to 37.1 percent.
Meanwhile, Lorillard’s domestic-market wholesale cigarette shipments during the six months to the end of June, at 18,815 million, were down by 2.5 percent from those of the first half of 2013, 19,306 million.
The company’s shipments of full-price brands were down by 1.8 percent to 16,213 million, with Newport’s shipments down by 1.7 percent to 16,075 million, Kent’s shipments down by 14.3 percent to 66 million and True’s shipments down by 12.8 percent to 72 million.
Shipments of price/value brands were down by 6.7 percent to 2,602 million, with shipments of Old Gold down by 11.3 percent to 194 million and shipments of Maverick down by 6.3 percent to 2,409 million.
Lorillard’s shipments to Puerto Rico and U.S. possessions were increased by 36.3 percent to 232 million, meaning that, overall, the company’s shipments were down by 3.2 percent to 19,048 million.
Net sales for the three months ended June 30, at $1,799 million, were down by 0.3 percent on those of the three months ended June 30, 2013.
Reported operating income was down by 1.5 percent to $532 million, while adjusted operating income was up by 0.6 percent to $532 million.
Reported net income was down by 4.2 percent to $300 million and adjusted net income was down by 1 percent to $304 million.
Reported diluted earnings per share (EPS) were unchanged at $0.83 and adjusted diluted EPS were up by 3.7 percent to $0.84.
Meanwhile, net sales for the six months ended June 30, at $3,391 million, were increased by 0.3 percent on those of the six months ended June 30, 2013.
Reported operating income was down by 8.8 percent to $1,004 million and adjusted operating income was up by 1.1 percent to $978 million.
Reported net income was down by 10.8 percent to $571 million and adjusted net income was down by 0.5 percent to $555 million.
Reported diluted earnings per share (EPS) were down by 7.1 percent to $1.57 and adjusted diluted EPS were up by 4.1 percent to $1.53.
“Lorillard continued to deliver industry-leading cigarette operating and market share performance in the second quarter and for the first half of 2014, while also making a significant investment to expand Blu eCigs in the U.K.,” said Murray S. Kessler, Lorillard chairman, president and CEO.
“Continued strong pricing realization and tight cost controls in our cigarettes segment allowed us to deliver solid adjusted cigarette operating income growth in the quarter and for the first half of the year.
“While second-quarter Blu eCigs’ sales were below expectations, recent new Blu product launches and the introduction of the Blu brand into the U.K. in the second quarter solidify Blu eCigs’ position as the U.S. market leader and the world’s first truly global e-cigarette brand and will result in accelerated sales going forward.”