Lorillard Inc. on Monday reported that its fourth-quarter profit fell by 6% as the maker of Newport cigarettes encounters higher manufacturing costs, pension and legal expenses.

Still, the cigarette maker claims its full-year decline was much less than the 8.6 percent slip that was the industry average.

The nation's third-largest cigarette company reported a 6 percent drop in its earnings to $242 million, or $1.52 per share, surpassing $1.51-per-share estimate of analysts surveyed by Thomson Reuters.

Annual net sales registered a rise of 25 percent to $5.23 billion from $4.2 billion. Removing excise taxes, sales grew 5.6 percent to $3.69 billion.

The company claims to ship 9.05 billion cigarettes, lowered by 4 percent from the previous year. A jump in shipments of the lower-priced Maverick brand assisted to lessen a 6.9 percent drop for the company's full-priced brands.

The cigarette makers, which have witnessed a steady decline for years, were hit in 2009 by a sharp increase in the federal cigarette tax in the midst of an unstable economy, which nudged some smokers to trade down to lower-priced brands.

The companies also have been troubled from new fees required as part of the law that gave the U. S. Food and Drug Administration oversight authority over the tobacco industry.