Cigarette maker Lorillard 4Q profit down slightly
As part of the industrywide push to diversify beyond the traditional cigarette business, Lorillard acquired e-cigarette maker Blu Ecigs in April.
Electronic cigarettes are battery-powered devices that heat a liquid nicotine solution in a disposable cartridge, creating vapor that users inhale. Some e-cigarettes are made to look like a real cigarette with a tiny light on the tip that glows like the real thing. Devotees tout them as a way to break addiction to real cigarettes. They insist the devices address both the nicotine addiction and the behavioral aspects of smoking without the more than 4,000 chemicals found in cigarettes.
The company said more marketing and distribution helped Blu Ecigs contribute $39 million to Lorillard's sales for the quarter. It estimates its share of the U.S. retail market, excluding Internet sales, to be about 30 percent.
The results for its e-cigarette segment were "pretty good for something we still consider in the developmental phase," Kessler said.
The company also Wednesday said its board approved a 6.5 percent increase in its quarterly dividend, to 55 cents per share. It's the fifth increase since Lorillard, the oldest continuously operating U.S. tobacco company, was spun off from Loews Corp. 9n 2008.
The dividend will be paid March 11 to shareholders of record as of March 1.
Shares rose $2.33, or 5.9 percent, to $42.05 in late morning trading Wednesday.
Michael Felberbaum can be reached at http://www.twitter.com/MLFelberbaum.
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