Document and Company Informatio
Document and Company Information (USD $) | |||
In Billions, except Share data | 6 Months Ended
Jun. 30, 2009 | Jul. 24, 2009
| Jun. 30, 2008
|
Document And Company Information [Abstract] | |||
Entity Registrant Name | Lorillard, Inc. | ||
Entity Central Index Key | 0001424847 | ||
Document Type | 10-Q | ||
Document Period End Date | 2009-06-30 | ||
Amendment Flag | false | ||
Amendment Description | N/A | ||
Company Fiscal Year End Date | --12-31 | ||
Entity Well Known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $12 | ||
Entity Common Stock Shares Outstanding | 165,154,651 |
Consolidated Condensed Balance
Consolidated Condensed Balance Sheets (USD $) | ||
In Millions | Jun. 30, 2009
| Dec. 31, 2008
|
Assets: | ||
Cash and cash equivalents | $1,558 | $1,191 |
Accounts receivables, less allowances of $3 and $2 | 15 | 7 |
Other receivables | 35 | 55 |
Inventories | 326 | 255 |
Deferred income taxes | 454 | 454 |
Other current assets | 75 | 0 |
Total current assets | 2,463 | 1,962 |
Plant and equipment | 221 | 218 |
Prepaid pension assets | 37 | 36 |
Deferred income taxes | 67 | 71 |
Other assets | 46 | 34 |
Total assets | 2,834 | 2,321 |
Liabilities and Shareholders' Equity: | ||
Accounts and drafts payable | 23 | 30 |
Accrued liabilities | 386 | 255 |
Settlement costs | 604 | 974 |
Income taxes | 5 | 14 |
Total current liabilities | 1,018 | 1,273 |
Long-term debt | 750 | 0 |
Postretirement pension, medical and life insurance benefits | 309 | 317 |
Other liabilities | 98 | 100 |
Total liabilities | 2,175 | 1,690 |
Shareholders' Equity: | ||
Preferred stock, $0.01 par value, authorized 10 million shares | 0 | 0 |
Common stock: | ||
Authorized - 600 million shares; par value - $0.01 per share Issued - 174 million and 174 million shares Outstanding - 166 million and 174 million shares | 2 | 2 |
Additional paid-in capital | 229 | 222 |
Earnings retained in the business | 1,126 | 965 |
Accumulated other comprehensive loss | (152) | (158) |
Shareholders' equity before treasury shares | 1,205 | 1,031 |
Treasury shares at cost, 8 million and 6 million shares | (546) | (400) |
Total shareholders' equity | 659 | 631 |
Total liabilities and shareholders' equity | $2,834 | $2,321 |
1_Consolidated Condensed Balanc
Consolidated Condensed Balance Sheets (Parenthetical) (USD $) | ||
In Millions | Jun. 30, 2009
| Dec. 31, 2008
|
Allowance for doubtful accounts | $3 | $2 |
Preferred stock, par value | 0.01 | 0.01 |
Preferred stock, shares authorized | 10 | 10 |
Common stock, par value | 0.01 | 0.01 |
Common stock, shares authorized | 600 | 600 |
Common stock, shares issued | 174 | 174 |
Common stock, shares outstanding | 166 | 174 |
Treasury shares at cost, shares | 8 | 6 |
Consolidated Condensed Statemen
Consolidated Condensed Statements of Income (USD $) | ||||
In Millions, except Per Share data | 3 Months Ended
Jun. 30, 2009 | 3 Months Ended
Jun. 30, 2008 | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
Net sales (including excise taxes of $486, $184, $635 and $347, respectively) | $1,519 | $1,070 | $2,436 | $1,991 |
Cost of sales | 965 | 627 | 1,496 | 1,181 |
Gross profit | 554 | 443 | 940 | 810 |
Selling, general and administrative | 98 | 91 | 189 | 191 |
Operating income | 456 | 352 | 751 | 619 |
Investment income | 1 | 6 | 2 | 16 |
Interest expense | (2) | (1) | (2) | (2) |
Income before income taxes | 455 | 357 | 751 | 633 |
Income taxes | 169 | 140 | 281 | 242 |
Net income | $286 | $217 | $470 | $391 |
Earnings per share: | ||||
Basic | 1.71 | 1.25 | 2.8 | 2.25 |
Diluted | 1.71 | 1.25 | 2.8 | 2.25 |
Number of shares outstanding: | ||||
Basic | 167.66 | 173.92 | 167.87 | 173.92 |
Diluted | 167.79 | 173.92 | 167.98 | 173.92 |
2_Consolidated Condensed Statem
Consolidated Condensed Statements of Income (Parenthetical) (USD $) | ||||
In Millions | 3 Months Ended
Jun. 30, 2009 | 3 Months Ended
Jun. 30, 2008 | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
Excise taxes | $486 | $184 | $635 | $347 |
3_Consolidated Condensed Statem
Consolidated Condensed Statements of Shareholders Equity (USD $) | |||||||||
In Millions | Adjustment
Common Stock | Adjustment
Additional Paid-in Capital | Common Stock
| Additional Paid-in Capital
| Earnings Retained in the Business
| Accumulated Other Comprehensive Loss
| Comprehensive Income
| Total
| |
Beginning Balance at Dec. 31, 2007 | $2 | $217 | $219 | $882 | ($88) | $0 | $1,013 | ||
Par value adjustment, Lorillard common stock - 1.7 million to 1 stock split | 2 | (2) | |||||||
Comprehensive income: | |||||||||
Net income | 391 | 391 | 391 | ||||||
Other comprehensive gains, pension liability | 2 | 2 | 2 | ||||||
Comprehensive income | 393 | ||||||||
Dividends paid | (491) | (491) | |||||||
Share-based compensation | 2 | 2 | |||||||
Ending Balance at Jun. 30, 2008 | 2 | 219 | 782 | (86) | 0 | 917 | |||
Beginning Balance at Mar. 31, 2008 | 2 | ||||||||
Comprehensive income: | |||||||||
Ending Balance at Jun. 30, 2008 | 2 | ||||||||
Beginning Balance at Dec. 31, 2008 | 2 | 222 | (400) | 965 | (158) | 0 | 631 | ||
Comprehensive income: | |||||||||
Net income | 470 | 470 | 470 | ||||||
Other comprehensive gains, pension liability | 6 | 6 | 6 | ||||||
Comprehensive income | 476 | ||||||||
Dividends paid | (309) | (309) | |||||||
Shares repurchased | (146) | (146) | |||||||
Share-based compensation | 7 | 7 | |||||||
Ending Balance at Jun. 30, 2009 | 2 | 229 | (546) | 1,126 | (152) | 0 | 659 | ||
Beginning Balance at Mar. 31, 2009 | 2 | ||||||||
Comprehensive income: | |||||||||
Ending Balance at Jun. 30, 2009 | $2 |
4_Consolidated Condensed Statem
Consolidated Condensed Statements of Cash Flows (USD $) | ||
In Millions | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
Cash flows from operating activities: | ||
Net income | $470 | $391 |
Adjustments to reconcile net cash provided by (used in) operating activities : | ||
Depreciation and amortization | 17 | 17 |
Deferred income taxes | 1 | 87 |
Share-based compensation | 2 | 1 |
Investment income | 0 | 1 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (4) | (16) |
Inventories | (71) | (71) |
Accounts payable and accrued liabilities | 123 | 40 |
Settlement costs | (370) | (315) |
Income taxes | (69) | 136 |
Other assets | (2) | 1 |
Postretirement health and life insurance benefits | (11) | (10) |
Other | 6 | (2) |
Net cash provided by operating activities | 92 | 260 |
Cash flows from investing activities: | ||
Purchases of investments | 0 | (800) |
Proceeds from maturities of investments | 0 | 497 |
Proceeds from sales of investments | 0 | 500 |
Additions to plant and equipment | (20) | (18) |
Net cash (used in)/provided by investing activities | (20) | 179 |
Cash flows from financing activities: | ||
Dividends paid | (309) | (491) |
Shares repurchased | (146) | 0 |
Proceeds from issuance of long-term debt | 750 | 0 |
Debt issuance cost | (5) | 0 |
Excess tax benefits from share-based arrangements | 5 | 0 |
Net cash provided by/(used in) financing activities | 295 | (491) |
Change in cash and cash equivalents | 367 | (52) |
Cash and cash equivalents, beginning of year | 1,191 | 1,210 |
Cash and cash equivalents, end of period | 1,558 | 1,158 |
Cash paid for income taxes | $345 | $37 |
Basis of Presentation
Basis of Presentation | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Basis of Presentation [Abstract] | |
Basis of Presentation | 1. Basis of Presentation Overview. Lorillard, Inc., through its subsidiaries, is engaged in the manufacture and sale of cigarettes. Its principal products are marketed under the brand names of Newport, Kent, True, Maverick and Old Gold with substantially all of its sales in the United States of America. The consolidated condensed financial statements of Lorillard, Inc. (the Company), together with its subsidiaries (Lorillard), include the accounts of the Company and its subsidiaries after the elimination of intercompany accounts and transactions. The Company manages its operations on the basis of one reportable segment through its principal subsidiary, Lorillard Tobacco Company (Lorillard Tobacco). The accompanying unaudited consolidated condensed financial statements reflect all adjustments necessary to present fairly the financial position as of June30, 2009 and December31, 2008 and the unaudited consolidated condensed statements of income, shareholders equity and changes in cash flows for the three and six months ended June30, 2009 and 2008. Results of operations for the three months and six months for each of the years reported herein are not necessarily indicative of results of operations of the entire year. These consolidated condensed financial statements should be read in conjunction with the Consolidated Financial Statements and related Notes to Consolidated Financial Statements presented in the Companys Annual Report on Form 10-K for the year ended December31, 2008, filed with the Securities and Exchange Commission (the SEC) on March2, 2009 and, as amended, in the Companys Current Report on Form 8-K, filed with the SEC on June11, 2009. On May7, 2008, the Company amended its certificate of incorporation to affect a 1,739,234.29 for 1 stock split of its 100 shares of common stock then outstanding. All common share and per share information has been retroactively adjusted for the periods presented. On June10, 2008, Loews Corporation (Loews) distributed 108,478,429 shares of common stock of the Company in exchange for and in redemption of all 108,478,429 outstanding shares of Loews Carolina Group stock, as described in the Registration Statement (File No.333-149051) on Form S-4 filed with the SEC under the Securities act of 1933, as amended (the Separation). Pursuant to the terms of the Exchange Offer, described in the Registration Statement, on June16, 2008, Loews accepted 93,492,857 shares of Loews common stock in exchange for 65,445,000 shares of the Companys common stock. As a result of such distributions, Loews ceased to own any equity interest in the Company and the Company became an independent publicly held company. Prior to the Separation, Lorillard was included in the Loews consolidated federal income tax return, and federal income tax liabilities were included on the balance sheet of Loews. Under the terms of the pre-Separation Tax Allocation Agreement between Lorillard and Loews, the Company made payments to, or was reimbursed by, Loews for the tax effects resulting from its inclusion in Loews consolidated federal income tax return. As of June30, 2009, Loews is obligated to reimburse Lorillard |
Inventories
Inventories | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Inventories [Abstract] | |
Inventories | 2. Inventories Inventories are valued at the lower of cost, determined on a last-in, first-out (LIFO) basis, or market and consisted of the following: June 30, December 31, 2009 2008 (In millions) Leaf tobacco $ 242 $ 208 Manufactured stock 78 42 Material and supplies 6 5 $ 326 $ 255 If the average cost method of accounting was used, inventories would be greater by approximately $174 and $155million at June30, 2009 and December31, 2008, respectively. |
Plant and Equipment
Plant and Equipment | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Plant and Equipment [Abstract] | |
Plant and Equipment | 3. Plant and Equipment Plant and equipment is stated at cost and consisted of the following: June 30, December 31, 2009 2008 (In millions) Land $ 3 $ 3 Buildings 87 87 Equipment 548 532 Total 638 622 Accumulated depreciation (417 ) (404 ) Plant and equipment, net $ 221 $ 218 |
Other Assets
Other Assets | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Other Assets [Abstract] | |
Other Assets | 4. Other Assets Other assets were as follows: June 30, December 31, 2009 2008 (In millions) Other investments $ 15 $ 15 Restricted cash 13 13 Debt issuance costs 5 Other prepaid assets 13 6 Total $ 46 $ 34 |
Accrued Liabilities
Accrued Liabilities | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Accrued Liabilities Disclosure [Abstract] | |
Accrued Liabilities | 5. Accrued Liabilities Accrued liabilities were as follows: June 30, December 31, 2009 2008 (In millions) Legal fees $ 24 $ 21 Salaries and other compensation 23 21 Medical and other employee benefit plans 25 27 Consumer rebates 80 62 Sales promotion 22 23 Excise and other taxes 149 56 Other accrued liabilities 63 45 Total $ 386 $ 255 |
Fair Value
Fair Value | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Fair Value [Abstract] | |
Fair Value | 6. Fair Value Fair value is the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following fair value hierarchy is used in selecting inputs, with the highest priority given to Level 1, as these are the most transparent or reliable: Level 1 Quoted prices for identical instruments in active markets. Level 2 Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable directly or indirectly. Level 3 Valuations derived from valuation techniques in which one or more significant inputs are unobservable. Lorillard is responsible for the valuation process and as part of this process may use data from outside sources in establishing fair value. Lorillard performs due diligence to understand the inputs used or how the data was calculated or derived, and corroborates the reasonableness of external inputs in the valuation process. Assets and liabilities measured at fair value on a recurring basis are summarized below. The valuation of securities that are actively traded or have quoted prices are classified as Level 1. These securities include money market funds and were valued as follows at June30, 2009: Level 1 Level 2 Level 3 Total (In millions) Cash and Cash Equivalents: Treasury money market funds $ 17 $ $ $ 17 Government money market funds 1,540 1,540 Prime money market funds 1 1 Total cash and cash equivalents $ 1,558 $ $ $ 1,558 Long Term Debt: Senior notes $ 778 $ $ $ 778 Total long term debt $ 778 $ $ $ 778 |
Long Term Debt
Long Term Debt | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Long Term Debt [Abstract] | |
Long Term Debt | 7. Long Term Debt In June2009, Lorillard Tobacco issued $750million of 8.125% unsecured senior notes due June 23, 2019 (the Notes) pursuant to an Indenture, dated June23, 2009, and First Supplemental Indenture, dated June23, 2009 (the Supplemental Indenture). Lorillard Tobacco is the principal, wholly-owned operating subsidiary of the Company and the Notes are unconditionally guaranteed on a senior unsecured basis by the Company. The interest rate payable on the Notes is subject to incremental increases from 0.25% to 2.00% in the event either Moodys Investors Services, Inc. (Moodys), Standard Poors Ratings Services (SP) or both Moodys and SP downgrade the Notes below investment grade (Baa3 and BBB- for Moodys and SP, respectively). Upon the occurrence of a change of control triggering event, Lorillard Tobacco will be required to make an offer to repurchase the Notes at a price equal to 101% of the aggregate principal amount of the Notes, plus accrued interest. A change of control triggering event occurs when there is both a change of control (as defined in the Supplemental Indenture) and the Notes cease to be rated investment grade by both Moodys and SP within 60days of the occurrence of a change of control or public announcement of the intention to effect a change of control. The Notes are not entitled to any sinking fund and are not redeemable prior to maturity. The Notes contain covenants that restrict liens and sale and leaseback transactions, subject to a limited exception. At June30, 2009, the carrying value of the Notes was $750million and the fair value was $778million. The fair value of the Notes was based on market pricing. The net proceeds from the Notes will be used for general corporate purposes that may include, among other things, the repurchase, redemption or retirement of securities including our common stock, additions to working capital and capital expenditures. |
Consolidating Financial Informa
Consolidating Financial Information | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Consolidating Financial Information [Abstract] | |
Consolidating Financial Information | 8. Consolidating Financial Information In June2009, Lorillard Tobacco issued Notes (see Note 7 for description of the Notes), which are unconditionally guaranteed by the Company, as primary obligor, for the payment and performance of Lorillard Tobaccos obligation in connection therewith. The following sets forth the condensed consolidating balance sheets as of June30, 2009 and December31, 2008, condensed consolidating statements of income for the three and six months ended June30, 2009 and 2008, and condensed consolidating statements of cash flows for the six months ended June30, 2009 and 2008 for the Company as parent guarantor (herein referred to as Parent), Lorillard Tobacco (herein referred to as Issuer) and all other non-guarantor subsidiaries of the Company and Lorillard Tobacco. These condensed consolidating financial statements were prepared in accordance with Rule3-10 of SEC RegulationS-X, Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered. Lorillard accounts for investments in these subsidiaries under the equity method of accounting. Condensed Consolidating Balance Sheets June30, 2009 (In millions) All Total Other Consolidating Parent Issuer Subsidiaries Adjustments Consolidated Assets: Cash and cash equivalents $ 138 $ 1,086 $ 334 $ $ 1,558 Accounts receivable, less allowances of $3 15 15 Other receivables 1 34 35 Inventories 326 326 Deferred income taxes 454 454 Other current assets 75 75 Total current assets 139 1,990 334 0 2,463 Investment in subsidiaries 540 380 (920 ) Plant and equipment 221 221 Prepaid pension assets 37 37 Deferred income taxes (5 ) 68 4 67 Other assets 31 15 46 Total assets $ 674 $ 2,727 $ 353 $ (920 ) $ 2,834 Liabilities and Shareholders Equity: Accounts and drafts payable $ $ 23 $ $ $ 23 Accrued liabilities 15 428 (57 ) 386 Settlement costs 604 604 Income taxes 5 5 Total current liabilities 15 1,060 (57 ) 1,018 Long-term debt 750 750 Postretirement pension, medical and life insurance benefits 309 309 Other liabilities 85 13 98 Total liabilities 15 2,204 (44 ) 2,175 Shareholders Equity: Common stock 2 2 Additional paid-in cap |
Earnings Per Share
Earnings Per Share | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 9. Earnings Per Share Basic and diluted earnings per share (EPS) were calculated using the following: Three Months Ended Six Months Ended June 30, June 30, 2009 2008 2009 2008 (In millions) Net Income $ 286 $ 217 $ 470 $ 391 Weighted Average Shares Outstanding Basic 167.66 173.92 167.87 173.92 Stock Options and Stock Appreciation Rights .13 .00 .11 .00 Weighted Average Shares Outstanding Diluted 167.79 173.92 167.98 173.92 Options to purchase 0.8million shares of common stock were excluded from the diluted earnings per share calculation because their effect would be anti-dilutive for the quarter ended June30, 2009. Loews distributed its interest in the Company to holders of Loews Carolina Group stock and Loews common stock in a series of transactions which were completed on June10, 2008 and June16, 2008, respectively. The Company had 173,923,429 shares outstanding as of the Separation from Loews. All prior period EPS amounts have been adjusted to reflect the new capital structure of the Company. |
Benefit Plans
Benefit Plans | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Benefit Plans [Abstract] | |
Benefit Plans | 10. Benefit Plans Lorillard has defined benefit pension, postretirement benefits, profit sharing and savings plans for eligible employees. Net periodic benefit cost components were as follows: Three Months Ended Six Months Ended June 30 June 30 Pension Benefits 2009 2008 2009 2008 (In millions) Service cost $ 4 $ 4 $ 8 $ 8 Interest cost 14 14 28 27 Expected return on plan assets (15 ) (17 ) (30 ) (34 ) Amortization of net loss 4 7 Amortization of prior service cost 1 1 3 2 Net periodic benefit cost $ 8 $ 2 $ 16 $ 3 Three Months Ended Six Months Ended June 30, June 30, Other Postretirement Benefits 2009 2008 2009 2008 (In millions) Service cost $ 1 $ 1 $ 2 $ 2 Interest cost 3 3 6 6 Amortization of net loss (1 ) (1 ) Net periodic benefit cost $ 3 $ 4 $ 7 $ 8 |
Share Repurchase Program
Share Repurchase Program | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Share Repurchase Program [Abstract] | |
Share Repurchase Program | 11. Share Repurchase Program On May21, 2009, Lorillard, Inc. announced that its Board of Directors had approved a share repurchase program, authorizing the Company to repurchase in the aggregate up to $250million of its outstanding common stock. Purchases by the Company under this program may be made from time to time at prevailing market prices in open market purchases, privately negotiated transactions, block purchases or otherwise, as determined by the Companys management. The repurchases will be funded from existing cash balances. This program does not obligate the Company to acquire any particular amount of common stock. The timing, frequency and amount of repurchase activity will depend on a variety of factors such as levels of cash generation from operations, cash requirements for investment in the Companys business, current stock price, market conditions and other factors. The share repurchase program may be suspended, modified or discontinued at any time and has no set expiration date. During the second quarter, the Company repurchased approximately 2.2million shares of its common stock at an average price of $67.67 per share, for a total of $146million. This share repurchase program follows on the prior authorization by the Board on July9, 2008 to repurchase in the aggregate up to $400million of its outstanding common stock, which was completed on October10, 2008. See Note 13 for additional information regarding the Companys share repurchase programs. |
Legal Proceedings
Legal Proceedings | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Legal Proceedings [Abstract] | |
Legal Proceedings | 12. Legal Proceedings Tobacco-Related Product Liability Litigation As of July27, 2009, approximately 6,875 product liability cases are pending against cigarette manufacturers in the United States. Lorillard Tobacco is a defendant in approximately 5,925 of these cases. Lorillard, Inc. is a co-defendant in approximately 710 cases. Approximately 3,200 of these lawsuits are Engle Progeny Cases, described below, in which the claims of approximately 8,625 individual plaintiffs are asserted. The pending product liability cases are composed of the following types of cases: Conventional Product Liability Cases. Conventional Product Liability Cases are brought by individuals who allege cancer or other health effects caused by smoking cigarettes, by using smokeless tobacco products, by addiction to tobacco, or by exposure to environmental tobacco smoke. As of July27, 2009, approximately 155 cases are pending against cigarette manufacturers, including approximately 35 cases against Lorillard Tobacco. Lorillard, Inc. is a co-defendant in four cases. Engle Progeny Cases. Engle Progeny Cases are brought by individuals who purport to be members of the decertified Engle class. These cases are pending in a number of Florida courts. Lorillard Tobacco is a defendant in approximately 3,200 Engle Progeny Cases. Lorillard, Inc. is a co-defendant in approximately 700 cases. Many of the cases have been filed on behalf of multiple class members, and approximately 8,625 individual smokers are asserting claims in the pending cases. West Virginia Individual Personal Injury Cases. West Virginia Individual Personal Injury Cases are brought by individuals who allege cancer or other health effects caused by smoking cigarettes, by using smokeless tobacco products, or by addiction to cigarette smoking. The cases are pending in a single West Virginia court and have been consolidated for trial. Lorillard Tobacco is a defendant in approximately 55 of the 730 pending cases that are part of this proceeding. Lorillard, Inc. is not a defendant in any of these cases. Flight Attendant Cases. Flight Attendant Cases are brought by non-smoking flight attendants alleging injury from exposure to environmental smoke in the cabins of aircraft. Plaintiffs in these cases may not seek punitive damages for injuries that arose prior to January15, 1997. Lorillard Tobacco is a defendant in each of the approximately 2,625 pending Flight Attendant Cases. Lorillard, Inc. is not a defendant in any of these cases. The time for filing Flight Attendant Cases expired during 2000 and no additional cases in this category may be filed. ClassAction Cases. ClassAction Cases are purported to be brought on behalf of large numbers of individuals for damages allegedly caused by smoking. Nine of these cases are pending against Lorillard Tobacco. Lorillard, Inc. is a co-defendant in two of these nine cases. Two of the nine cases assert claims on behalf of purchasers of light cigarettes. Lorillard, Inc. is not a defendant in either of these cases. Neither Lorillard Tobacco nor Lorillard, Inc. is a defendant in the approximately 30 additional lights class actions that are pending against |
Subsequent Events
Subsequent Events | |
6 Months Ended
Jun. 30, 2009 USD / shares | |
Subsequent Events [Abstract] | |
Subsequent Events | 13. Subsequent Events As of July 28, 2009, the Company completed the $250million share repurchase program announced on May21, 2009, repurchasing in the aggregate approximately 3.7 million shares of its outstanding common stock. On July27, 2009, the Company announced that its Board of Directors had approved an additional share repurchase program, authorizing the Company to repurchase in the aggregate up to $750million of its outstanding common stock. Purchases by the Company under this program may be made from time to time at prevailing market prices in open market purchases, privately negotiated transactions, block purchase techniques or otherwise, as determined by the Companys management. The purchases will be funded from existing cash balances, including proceeds from the issuance of the Notes (see Note 7 for a description of the Notes). This program does not obligate the Company to acquire any particular amount of its common stock. The timing, frequency and amount of repurchase activity will depend on a variety of factors such as levels of cash, generation from operations, cash requirements for investment in the Companys business, current stock price, market conditions and other factors. The share repurchase program may be suspended, modified or discontinued at any time and has no set expiration date. |