Cigarette maker Lorillard said Wednesday its net income fell 10 per cent in the first quarter 2012 as higher prices could not offset a decline in the number of cigarettes sold.

Lorillard earned USD 223 (EUR 168) million, or USD 1.70 (EUR 1.28) per share, for the period ended 31 March, down from USD 248 million, or USD 1.71 per share, a year ago.
The company's fundamental performance remained strong, although it was masked by "significant changes in wholesale inventory," CEO Murray Kessler said in a conference call.
Lorillard said the number of cigarettes it sold fell about 3 per cent to 9.44 billion cigarettes. Newport, its biggest brand, fell 4 per cent, while low-priced Maverick cigarettes rose about 10 per cent. The company estimates that the industry as a whole sold about 4 per cent fewer cigarettes during the quarter.
Total Lorillard retail market share increased 0.4 share points in the first quarter versus last year to an alltime high of 14.5 per cent.
Lorillard, third-biggest tobacco company in the US, also announced that it has acquired electronic cigarette maker Blu Ecigs for USD 135 million (EUR 102 million), part of an industrywide push to diversify beyond the traditional cigarette business. Blu Ecigs, based in Charlotte, North Carolina, will remain a separate operating company.
Lorillard further completed its USD 750 million share buyback during the quarter, repurchasing about 1.6 million shares at a cost of USD 188 million. (pi)