Vector Group Reports Third Quarter 2005 Financial Results

Third quarter 2005 revenues were $125.0 million, compared torevenues of $124.3 million in the third quarter of 2004. The Companyrecorded operating income of $20.0 million in the 2005 third quarter,compared to operating income of $16.7 million in the third quarter of2004. Net income for the 2005 third quarter was $9.0 million, or $0.19per diluted common share, compared to net income of $8.1 million, or$0.17 per diluted common share, in the 2004 third quarter.

For the nine months ended September 30, 2005, revenues were $342.3million, compared to $370.9 million for the first nine months of 2004.The Company recorded operating income of $63.0 million for the 2005nine-month period, compared to operating income of $3.7 million forthe 2004 period. The results for the nine months ended September 30,2004 included a pre-tax non-cash charge of $37.0 million to adjust thecarrying value of excess leaf tobacco inventory for the Quest brandand pre-tax restructuring and impairment charges of $7.5 million.Adjusting for the 2004 inventory and restructuring charges, theCompany's operating income for the nine months ended September 30,2004 was $48.2 million. Gain from discontinued operations was $3.0million for the 2005 period, compared to $0.4 million for the prioryear period. Net income for the 2005 nine-month period was $30.3million, or $0.66 per diluted common share, compared to a net loss of$4.2 million, or $0.10 per diluted common share, for the 2004 period.

For the three and nine months ended September 30, 2005, theCompany's conventional cigarette business, which includes LiggettGroup cigarettes and USA brand cigarettes, had revenues of $122.7million and $334.6 million, respectively, compared to $120.8 millionand $358.6 million for the three and nine months ended September 30,2004, respectively. Operating income was $31.5 million for the thirdquarter of 2005 and $97.7 million for the first nine months of 2005,compared to $27.2 million and $80.4 million for the three and ninemonths ended September 30, 2004, respectively. The results for thethree and nine months ended September 30, 2005 included a specialfederal quota stock liquidation assessment under the federal tobaccobuyout legislation of $5.2 million. The results for the three and ninemonths ended September 30, 2004 include pre-tax restructuring andimpairment charges of $4.0 million and $6.3 million, respectively.

Conference Call To Discuss Third Quarter 2005 Results

As previously announced, the Company will host a conference calland webcast on Thursday, November 10, 2005 at 11:00 A.M. (EDT) todiscuss third quarter 2005 results. Investors can access the call bydialing 877-692-2590 or via live webcast at www.vcall.com

A replay of the call will also be available shortly after the callends on November 10, 2005 through November 24, 2005. To access thereplay, dial 877-519-4471 and enter 6679480 as the conference IDnumber. The archived webcast will also be available at www.vcall.comfor 30 days.

Vector Group is a holding company that indirectly owns LiggettGroup Inc., Vector Tobacco Inc. and a controlling interest in NewValley Corporation. Additional information concerning the company isavailable on the company's website, www.VectorGroupLtd.com.

VECTOR GROUP LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in Thousands, Except Per Share Amounts)
Unaudited


Three Months Ended Nine Months Ended
--------------------- ---------------------
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2005 2004 2005 2004
---------- ---------- ---------- ----------

Revenues* $ 124,965 $ 124,251 $ 342,251 $ 370,869

Expenses:
Cost of goods sold
(including inventory
impairment of $0, $0,
$0 and $37,000)* 77,880 71,117 202,780 252,045
Operating, selling,
administrative and
general expenses 27,109 31,887 76,485 107,623
Restructuring and
impairment charges - 4,532 - 7,544
--------- --------- --------- ---------
Operating income 19,976 16,715 62,986 3,657

Other income (expenses):
Interest and dividend
income 1,380 322 3,260 1,548
Interest expense (8,266) (6,378) (24,155) (18,650)
Gain on sale of
investments, net 8 302 1,433 5,888
Gain from conversion of
LTS notes - - 9,461 -
Equity loss on operations
of LTS - - (299) -
Equity income from non-
consolidated New Valley
real estate businesses 4,184 4,539 6,202 9,827
Other, net 13 (1) 69 (10)
--------- --------- --------- ---------


Income from operations
before income taxes and
minority interests 17,295 15,499 58,957 2,260
Income tax expense 7,541 6,708 29,322 3,562
Minority interests (779) (837) (2,403) (3,286)
--------- --------- --------- ---------

Income (loss) from
continuing operations 8,975 7,954 27,232 (4,588)
--------- --------- --------- ---------

Discontinued operations:

Income from discontinued
operations, net of
minority interests and
taxes - 112 82 379
Gain on disposal of
discontinued operations,
net of minority
interests and taxes - - 2,952 -
--------- --------- --------- ---------

Gain from discontinued
operations - 112 3,034 379
--------- --------- --------- ---------

Net income (loss) $ 8,975 $ 8,066 $ 30,266 $ (4,209)
========= ========= ========= =========

Per basic common share:

Income (loss) from
continuing operations $ 0.20 $ 0.18 $ 0.62 $ (0.11)
========= ========= ========= =========
Income from discontinued
operations $ - $ - $ 0.07 $ 0.01
========= ========= ========= =========
Net income (loss)
applicable to common
shares $ 0.20 $ 0.18 $ 0.69 $ (0.10)
========= ========= ========= =========

Per diluted common share:

Income (loss) from
continuing operations $ 0.19 $ 0.17 $ 0.59 $ (0.11)
========= ========= ========= =========
Income from discontinued
operations $ - $ - $ 0.07 $ 0.01
========= ========= ========= =========
Net income (loss)
applicable to common
shares $ 0.19 $ 0.17 $ 0.66 $ (0.10)
========= ========= ========= =========

* Revenues and Cost of goods sold include excise taxes of $42,413,
$42,626, $112,856 and $132,729, respectively.