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TORONTO - Rothmans Inc., Canada's second-biggest cigarette maker, reported a higher first-quarter profit on Tuesday, thanks to price increases across all ...

TORONTO - Rothmans Inc., Canada's second-biggest cigarette maker, reported a higher first-quarter profit on Tuesday, thanks to price increases across all its products.

Rothmans, which makes Craven A and Benson & Hedges brand cigarettes, earned $33.8-million (US$32.34-million), or 50 cents a share, in the period ended June 30, up from a profit of $29.3-million, or 43 cents a share, in the same period last year.

Rothmans will pay a dividend of 30 cents per share September 17.

Sales at Rothmans Benson & Hedges Inc., which is a 60% owned unit, net of excise duty and taxes, rose to $177.4-million from $162.9-million a year earlier.

Rothmans Benson and Hedges shipped 2.8 billion cigarettes into the domestic market in the quarter, a 1.2% rise from a year earlier.

The increase was driven by higher price category cigarette volumes offsetting declines in premium cigarette and fine cut volumes.

"Rothmans shareholders benefited from the improvement in all significant measures of financial performance at RBH including sales, earnings and cash flow" said John Barnett, president of Rothmans Inc.

However, the company remained "highly concerned" about the impact of contraband cigarettes.