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GREENSBORO, N.C. -- As cigarette manufacturers struggle with declining volumes, Lorillard Inc. saw its shipments rise not only in the fourth quarter of 2011 compared to the same period in 2010, but for the year overall.
"Quarters, and years for that matter, don't get much better than this," said Murray Kessler, president, chairman and CEO of Lorillard.
Speaking during a conference call this morning, Kessler said the fourth quarter saw gains in market share, pricing realization and margins driven by strategic initiatives put in place during 2011.
"We can attribute [the strong quarter and year] to the strength of our brands, our people and our business models," he added.
Lorillard, the maker of Newport, Newport Non-Menthol and Maverick brands, continued to "buck trends" as it saw domestic wholesale shipments rise 5.5 percent during the fourth quarter of 2011, Kessler explained. Breaking it down by brand, domestic wholesale shipments of Newport rose 4.3 percent, while domestic wholesale shipments for Maverick -- its leading discount brand -- increased 15.8 percent.
Additionally, Lorillard's domestic retail market share inched up 0.8 share points to a current share of 14 percent, according to the company's earnings.
For the full year, Lorillard's domestic wholesale shipments increased 6.9 percent compared to 2010. For Newport, domestic wholesale shipments grew 6. 1 percent, as Maverick domestic wholesale shipments increased 16 percent. Lorillard registered these gains as total cigarette industry domestic wholesale shipments decreased an estimated 3.5 percent for 2011 vs. 2010, the company noted.
Looking at overall numbers, Lorillard reported net income of $310 million for the fourth quarter of 2011. Reported net income for the full year was $1.116 billion.
"2011 was a great year and we exited the year with a strong quarter," Kessler concluded, adding that Lorillard remains bullish on 2012.