Reynolds American announced first-quarter 2015 adjusted EPS of $0.86, up 19.4% from the prior-year quarter, on the strength of higher cigarette and moist-snuff pricing, and the completion of the federal tobacco-quota buyout.
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Adjusted EPS excludes a one-time benefit from the 2003 NPM adjustment claim and charges for transaction-related and financing costs, tobacco-related and other litigation, and Engle progeny lawsuits, including the proposed settlement of federal cases. Reported fourth-quarter EPS was $0.73, up 9 percent.
RAI reaffirmed 2015 adjusted EPS guidance in the range of $3.65 to $3.80, up 6.7 percent to 11.1 percent from 2014's adjusted EPS of $3.42.
RJR Tobacco's first-quarter adjusted operating income increased 16.3 percent from the prior-year quarter, to $645 million, benefitting from higher cigarette pricing and the completion of the federal tobacco-quota buyout.
Adjusted results exclude a one-time benefit from the 2003 NPM adjustment claim and charges for tobacco related and other litigation and Engle progeny lawsuits, including the proposed settlement of federal cases.
Reported first-quarter operating income was $588 million, up 22 percent from the prior year-quarter. RJR Tobacco's first-quarter adjusted operating margin increased 4.6 percentage points from the prioryear quarter, to 40.1 percent.
American Snuff's first-quarter operating income rose 16.7 percent from the prior-year quarter, to $118 million, benefitting from higher pricing and volume. This performance reflects the company's keen focus on balancing market share and profitability growth.
American Snuff's operating margin also increased in the first quarter, and was up 3.8 percentage points from the prior-year quarter, at 58.9 percent.
Santa Fe delivered outstanding performance in the first quarter, with operating income growing 41.9 percent from the prior-year quarter, to $92 million, driven by higher pricing and volume in the superpremium cigarette category. Santa Fe's first-quarter operating margin increased 5.6 percentage points from the prior-year quarter, to 53.9 percent.
Reynolds American's first-quarter adjusted EPS of $0.86 increased 19.4 percent from the prior-year quarter, benefitting from higher pricing and the completion of the federal tobacco-quota buyout.
Adjusted EPS excludes a one-time benefit of $0.08 from the 2003 NPM adjustment claim, and charges of $0.06 for transaction-related and financing costs for the Proposed Transactions, $0.02 for tobacco-related and other litigation, and $0.13 for Engle progeny lawsuits, which included the proposed settlement of the federal cases. On a reported basis, first-quarter EPS was $0.73, up 9.0 percent.
RAI's first-quarter adjusted operating margin increased 2.8 percentage points, to 37.2 percent. RAI ended the quarter with cash balances of $1.6 billion. On April 15, R.J. Reynolds Tobacco Company made its MSA payment of $1.4 billion, including $429 million paid into the NPM disputed funds account. ■