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Anti-Smoking Laws Increased Cigarette Makers’ Profit

High Taxes on CigarettesReynolds American Inc. raised its income because of high tobacco prices which increased its smokeless tobacco business too. In comparison with a quarter a year earlier when the company posted big declines in the value of its tobacco products. The manufacturer of Pall Mall, Camel and American Spirit brand cigarettes declared that it earned $82 million, or 28 cents per share, in the period that ended with March 31.

That earn is up from $8 million, or 3 cents per share, a year earlier. Thanks to an act with officials in Canada, Reynolds American earned also $1.11 per share.

This tobacco company reported that its income excluding high taxes rose 3.4 percent to $1.99 billion from $1.92 billion a year ago.

It predicted that it will earn $4.80 to $5.00 per share this year from continuing activity.

But based in Winston-Salem, the company argued that it sold 18.2 billion cigarettes in the period, 2.5 percent less than a year before, when retailers cut their orders in future of a former federal tax on inventory. And cigarette amount declined too by almost 4.8 percent. The company estimated that cigarette size dropped 7.3 percent industry wide.

So, Reynolds American’s market share rose 0.2 points to 27.9 percent as sales of Pall Mall cigarettes rose. The company has been actively promoting Pall Mall as a longer-lasting and more affordable cigarette during the decline.

The company said volumes of its smokeless tobacco grew also by almost 12.2 percent compared with the year-ago period.

In our days Reynolds American and other cigarettes companies are focusing on cigarette alternatives, such as snuff and chewing tobacco, for future sales growth because tax increases, smoking bans, health concerns and social shame make the cigarette business severe.


About The Author

Jessica Miller is a professional author of many tobacco articles, trained seminars from New York to London contributing to the success of this area in the U.S. At present writes about everything that is interesting especially about cheap cigarettes online store, tobacco related subjects and cigarette effects.


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