UPDATE 2-Lorillard profit beats, Newport gains share
* EPS $1.71; Wall Street view $1.43
* Board sets $750 million share repurchase plan
* Shares up 2.6 pct in thin premarket trading (Adds sales, background)
CHICAGO, July 27 (Reuters) - Lorillard Inc (LO.N) posted higher-than-expected quarterly profit, helped by increased prices as its Newport cigarette brand continued to gain market share.
The company also said on Monday that its board of directors approved a $750 million share repurchase plan.
Lorillard's results capped a quarter when it and larger U.S. rivals Altria Group Inc (MO.N) and Reynolds American Inc (RAI.N) all posted higher-than-expected profits, helping to alleviate investor concerns that a sharp increase in federal tobacco taxes would pressure profits.
Lorillard's second-quarter profit was $286 million, or $1.71 a share, compared with $217 million, or $1.25 a share, a year earlier. Analysts on average forecast $1.43 a share, according to Reuters Estimates.
Newport's U.S. market share rose to 10.38 percent from 9.94 percent a year earlier, the company said.
Lorillard's net sales rose 41.2 percent to $1.52 billion, largely due to the April 1 cigarette tax increase. Excluding taxes, sales rose 16.6 percent.
The company shipped 9.87 billion cigarettes in the quarter, up 2.1 percent from a year earlier, as wholesalers and retailers rebuilt inventories after cutting them in the first quarter in order to minimize their payments for cigarettes held on April 1, when the tax increase went into affect.