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Lorillard Misses EPS, But Up Y/Y - Analyst Blog
Lorillard Inc. (LO) delivered second quarter of 2012 adjusted earnings (exclude expenses incurred in conjunction with the acquisition of blu ecigs) of $2.19 per share, which exceeded the prior-year quarterly earnings of $2.05 per share by 6.8%. The results benefited from a lower share count, owing to the company's buyback program. However, results lagged the Zacks Consensus Estimate of $2.32 per share.
Quarter in Detail
Net sales in the reported quarter went up 2.3% year over year to $1.73 billion. Revenue largely surpassed the Zacks Consensus Estimate of $1.25 billion on the back of higher pricing.
Total wholesale cigarette volume of Lorillard decreased 1.2% in the second quarter including shipment Puerto Rico and U.S., while total domestic wholesale shipments excluding Puerto Rico and U.S. Possessions slipped 1.3% year over year.
Lorillard's domestic retail market share climbed 0.1 share points in the reported quarter to a market share of 14.3%, while Lorillard's domestic retail market share of the menthol market went down 0.1 share points in the reported quarter to a market share of 39.3%.
The company's flagship brand, Newport's total unit volume decreased 1.8% and domestic volume slipped 2.0% in the quarter. Domestic retail market share remained flat year over year at 12.0% in the second quarter of 2012.
Gross profit margin remained flat year over year at 35.4% of net sales. Gross profit went up to $612.0 million compared to $599.0 million in the second quarter of 2011, reflecting higher sales.
Capital Structure
Lorillard ended the quarter with cash and cash equivalents of $946 million as compared to $1.93 billion at the end of the prior quarter. Long-term debt was $2.6 billion at the end of June 30, 2012 as against $2.5 at the end of March 31, 2012.
Acquisition Update
Along with the earnings conference call, Lorillard has announced the cash acquisition of all the assets of blu ecigs, a U.S.-based electronic cigarette (e-cigarette) company, for $135 million.
Lorillard, which competes with Reynolds American Inc. (RAI) and Philip Morris Inc. (PM), currently holds a Zacks #3 Rank (a short-term Hold rating).
Quarter in Detail
Net sales in the reported quarter went up 2.3% year over year to $1.73 billion. Revenue largely surpassed the Zacks Consensus Estimate of $1.25 billion on the back of higher pricing.
Total wholesale cigarette volume of Lorillard decreased 1.2% in the second quarter including shipment Puerto Rico and U.S., while total domestic wholesale shipments excluding Puerto Rico and U.S. Possessions slipped 1.3% year over year.
Lorillard's domestic retail market share climbed 0.1 share points in the reported quarter to a market share of 14.3%, while Lorillard's domestic retail market share of the menthol market went down 0.1 share points in the reported quarter to a market share of 39.3%.
The company's flagship brand, Newport's total unit volume decreased 1.8% and domestic volume slipped 2.0% in the quarter. Domestic retail market share remained flat year over year at 12.0% in the second quarter of 2012.
Capital Structure
Lorillard ended the quarter with cash and cash equivalents of $946 million as compared to $1.93 billion at the end of the prior quarter. Long-term debt was $2.6 billion at the end of June 30, 2012 as against $2.5 at the end of March 31, 2012.
Acquisition Update
Along with the earnings conference call, Lorillard has announced the cash acquisition of all the assets of blu ecigs, a U.S.-based electronic cigarette (e-cigarette) company, for $135 million.
Lorillard, which competes with Reynolds American Inc. (RAI) and Philip Morris Inc. (PM), currently holds a Zacks #3 Rank (a short-term Hold rating).
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