Reynolds American Inc., the nation's second largest cigarette company, said Wednesday that its fourth-quarter profit fell 13 percent on impairment charges, but its adjusted earnings beat Wall Street's expectations.

Reynolds brands include Camel, Pall Mall and Natural American Spirit. Reynolds also owns Conwood Co., the smokeless tobacco company that makes Kodiak and Grizzly brands.

The Winston-Salem, N.C.-based company's fourth-quarter income slipped to $258 million, or 89 cents per share, from $297 million, or $1.01 per share, in the same quarter a year ago.

The latest quarter's results included $145 million in trademark impairment charges on the company's Kodiak brand and others, as well as a $33 million write-down on a long-term investment.

Excluding those charges, the company's profit totaled $370 million, or $1.27 per share, compared with $338 million, or $1.15 per share, in the prior-year period.

Revenue dipped 2 percent to $2.18 billion from $2.23 billion.

Analysts polled by Thomson Reuters, whose estimates generally exclude one-time items, forecast profit of $1.16 per share on sales of $2.2 billion.

Cigarette volume fell 8.4 percent in 2008, compared with an industry decline of 3.3 percent. The company attributed the drop to tough competition in the first half of 2008 and its discontinuation of some cigarette styles during the year.

The company said lower volumes in 2008 were more than offset by higher prices, improved productivity at R.J. Reynolds and double-digit volume growth in Conwood's moist-snuff products.

For the full fiscal year, earnings gained 2 percent to $1.34 billion, or $4.57 per share, from $1.31 billion, or $4.43 per share, a year before.

Excluding one-time items, 2008 adjusted earnings totaled $1.41 billion, or $4.80 per share, compared with $1.35 billion, or $4.57 per share, in the prior year.

Full-year sales dipped 2 percent to $8.85 billion from $9.02 billion.

Analysts American forecast full-year profit of $4.69 per share on sales of $8.87 billion.

Reynolds American noted it booked $90 million in restructuring charges in 2008, which is expected to generate cost savings that will grow to $55 million annually by 2011.

Reynolds American President and Chief Executive Susan M. Ivey also noted that the company added a dedicated growth and innovations organization this year, which she said will help focus the company on new products that will drive profit.

At the end of the year, Reynolds had $2.6 billion in cash. The company said it has no need to access the credit markets to fund its operations.