Reynolds American Beats Q1 Expectations

reported upbeat results for the first quarter on Friday. The Winston-Salem, North Carolina-based company posted quarterly earnings of $389 million, or $0.73 per share, versus a year-ago profit of $363 million, or $0.67 per share, in the year-ago period. Excluding one-time items, the company's earnings rose to$0.86 per share from $0.72 per share. Its revenue climbed 6.3 percent to $2.06 billion. However, analysts were expecting earnings of $0.80 per share on revenue of $1.98 billion. Cigarette shipments at the company's RJR Tobacco unit dropped 2.4 percent. RJR Tobacco's adjusted operating income climbed 16.3 percent, while American Snuff's operating come jumped 16.7 percent in the quarter. Santa Fe operating income surged 41.9 percent during the quarter. The company ended the quarter with cash balance of $1.6 billion. The average estimate among 12 Estimize users was for earnings of $0.80 per share and revenue of $1.99 billion. "I'm very pleased to report that Reynolds American delivered strong first-quarter results as our operating companies turned in excellent financial performance in addition to driving momentum in their key-brands' marketplace performance," said Susan M. Cameron, president and chief executive officer of RAI. "All of our operating companies increased both earnings and operating margins, while remaining focused on strategic initiatives to grow their diverse and highly differentiated key brands." Reynolds American reaffirmed its 2015 adjusted earnings forecast of $3.65 to $3.80 per share. Reynolds American shares rose 0.75 percent to $74.80 in pre-market trading.