Reynolds American Q2 Profit Rises, Tops View; Tightens 2014 Adj. EPS Outlook

(RTTNews) - Reynolds American Inc. (RAI) reported that its second-quarter net income increased to $492 million from the prior year's $461 million, with earnings per share improving to $0.92 from $0.84 last year.

Adjusted earnings per share were $0.89, up from the previous year's $0.84, as higher cigarette and moist-snuff pricing, and the ongoing benefit from the partial settlement of certain NPM Adjustment claims, more than offset lower cigarette volume and increased investment on the VUSE Digital Vapor Cigarette expansion. Analysts polled by Thomson Reuters expected the company to report earnings of $0.87 per share. Analysts' estimates typically exclude special items.

But, net sales for the quarter dropped to $2.162 billion from $2.179 billion last year. Wall Street expected revenues of $2.19 billion for the quarter.

The company tightened 2014 adjusted earnings per share guidance in the range of $3.35 to $3.45, up 5.0 percent to 8.2 percent from 2013's adjusted earnings per share of $3.19. Analysts project annual earnings per share of $3.35.