Reynolds American Inc., the nation's second-biggest tobacco company, said its fourth-quarter profits rose 16 percent, as higher prices and productivity gains helped offset declining cigarette sales.
The Greensboro News and Record reports that the maker of Camel, Pall Mall and Natural American Spirit brand cigarettes reported net income of $304 million, or 52 cents per share, for the three-month period ended Dec. 31, up from $262 million, or 45 cents per share, a year ago.
According to the report, Winston-Salem based Reynolds American also says that it has started a detailed review of its businesses to "ensure they are aligned with today's economic and competitive landscape." It expects that review to be completed by March 31.
Meanwhile, the company confirmed that it has laid off workers at its Tobaccoville, N.C., manufacturing plant, but would not say how many. Spokeswoman Maura Payne said the company also has asked some of its salaried and hourly employees whether they'd be interested in leaving the company in return for a severance package.
The newspaper report said Reynolds American and other tobacco companies are focusing on cigarette alternatives such as snuff and chewing tobacco for future sales growth as tax hikes, smoking bans, health concerns and social stigma make the cigarette business tougher.
Last week, rival Altria Group Inc., owner of the nation's biggest cigarette maker, Philip Morris USA, said its fourth-quarter profit fell about 9 percent, even as higher prices and gains from its smokeless tobacco products helped bolster its sales.
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