Jul 28, 8:05 AM EDT

Reynolds American beats 2Q profit forecasts

AP Photo
AP Photo/Gene J. Puskar

Buy AP Photo Reprints

WINSTON SALEM, N.C. (AP) -- Reynolds American reported a surge in second-quarter profit with cigarette prices and volume rising.

The nation's second-biggest tobacco company topped Wall Street profit expectations, boosted its profit guidance and dividend and announced a 2-for-1 stock split.

Net income more than tripled to $1.93 billion, or $3.38 per share.

Earnings, adjusted for non-recurring gains, came to $1.02 per share, which was still 8 cents better than analysts had expected, according to a poll by Zacks Investment Research .

The parent of Camel and Pall Mall cigarette maker R.J. Reynolds posted an 11.1 percent boost in revenue to $2.4 billion in the period. It recently closed on a $25 billion takeover of Newport seller Lorillard Inc..

Cigarette volumes rose 5.6 percent and the quarter included a hefty gain on a divestment that was part of the Lorillard deal.

The company now expects full-year earnings in the range of $1.90 to $2 per share, up from prior guidance of $1.83 to $1.90.

Reynolds is raising its dividend 7.5 percent to $1.44 annually after the stock split.

Shares of Reynolds American Inc., based in The Winston Salem, North Carolina, have increased 23 percent since the beginning of the year, while the Standard & Poor's 500 index has stayed nearly flat. The stock has climbed 39 percent in the last 12 months.

-----

Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap ) using data from Zacks Investment Research. Access a Zacks stock report on RAI at http://www.zacks.com/ap/RAI

-----

Keywords: Reynolds American, Earnings Report, Priority Earnings

© 2015 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. Learn more about our Privacy Policy and Terms of Use.