Reynolds American Inc. Q4 Shipments Fall 5%, Vs 1.7% For Altria Group Inc.

Reynolds American Inc.

got smoked in the fourth quarter by tobacco rival Altria Group Inc.

- at least in terms of the rate of decline in cigarette sales. Reynolds on Tuesday posted a 5 percent decline in cigarette sales to 14.9 billion; Altria cigarette sales fell 1.7 percent in the same period to 31 billion cigarettes. Total industry cigarette volumes meanwhile declined 2.5 percent in the fourth quarter, according to research cited by Altria. But Reynolds closed Tuesday up nearly 3 percent at $70.29. The company reassured investors that its proposed $27.4 billion merger with Lorillard Inc.

is on track for completion in the first half of 2015. The deal, unveiled in July, remains under review by the Federal Trade Commission, which made a second request for information in August. Lorillard Inc.

is slated to post fourth-quarter results Wednesday before the market opens. Reynolds' fourth-quarter adjusted income rose 13 percent to $0.87 cents a share, while adjusted revenue increased 5 percent to $2.13 billion on higher cigarette and smokeless tobacco prices. Altria Group, which also sells smokeless tobacco and wine, posted adjusted fourth-quarter earnings growth on Jan. 30 of 15.8 percent, to $0.66 a share, while revenue increased 2.9 percent to $6.26 billion. Altria, with a reported 40 percent share of the cigarette market, missed fourth-quarter expectations , while Reynolds, with about a 26 percent share, met Wall Street's views. Lorillard, with about a 14 percent market share, is expected to post earnings of $0.92 cents a share on revenue of $1.29 billion.