Boston, MA 05\/06\/2014 (wallstreetpr) –\u00a0Lorillard Inc. (NYSE:LO)<\/b> is the third largest manufacturer of cigarettes in the U.S. Newport; its flagship premium cigarette brand is the top selling menthol and second largest selling cigarette in the country. A few days back the company had announced its first quarter results and showed a GAAP diluted earnings per share decrease of $0.12 per share.<\/p>\n
With the decline in profits, company is speculated to look forward to a merger with Reynolds American Inc. (NSYE:RAI),<\/b> second largest company in the same segment. The merger, if happens, will create a massive power player of tobacco. The analysts, though, think otherwise that this could launch another tobacco company into the big three. This is based on the assumption to deal with any potential concerns of anti-trust issues with the U.S. Federal Trade Commission.<\/p>\n
Merger could launch a new player in the big three<\/b><\/p>\n
Susan Cameron has returned to being Reynolds\u2019s President and CEO for next two to three years, and the move is to take Lorillard Inc. (NYSE:LO) to the next level of growth. The merger is expected to be a part of the same strategy.<\/p>\n
Cigarette companies are struggling due to increasing health awareness and tough regulatory measures on smoking. They are facing declines in sales and revenues from combustible cigarettes. The merger of these two top players can help them take advantage of growing electronic cigarette industry. Also, the creation of a third company will help them cut costs and benefit from existing workforce.<\/p>\n
The net sales of Lorillard Inc. (NYSE:LO) increased by $15 million and reached $1.592 billion in Q1 2014. Out of which the sales of electronic cigarettes segment declined from $57 million in Q1 2013 to $51 million in Q1 2014. Gross profit for Q1 2014 was 31.4% of net sales or $16 million.<\/p>\n
On the other hand, profits of Reynolds had fell by more than 28% for Q1 with a decline in sales and spending in expansion of electronic cigarette brand and their legal costs.<\/p>\n","protected":false},"excerpt":{"rendered":"
Boston, MA 05\/06\/2014 (wallstreetpr) –\u00a0Lorillard Inc. (NYSE:LO) is the third largest manufacturer of cigarettes in the U.S. Newport; its flagship premium cigarette brand is the […]<\/p>\n","protected":false},"author":32,"featured_media":21237,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":{"twitter_2902945987_2902945987":""},"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[2236],"tags":[4580,6354,4581,6353],"stock_ticker":[],"class_list":["post-21236","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-lorillard-inc-nyselo","tag-nsyerai","tag-nyselo","tag-reynolds-american-inc-nsyerai","entry"],"acf":[],"yoast_head":"\n