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• Altria and BAT profits beat estimates, but shares fall 

British American Tobacco Plc, the world's second-largest publicly traded tobacco company, said on Thursday first-half profit rose 16 percent, underscoring strength in emerging markets, despite higher fuel prices.

At the same time, Altria Group Inc -- which sells the dominant Marlboro brand but only operates in the United States -- saw a faster decline in the number of cigarettes it sells, raising concerns about how well cash-strapped U.S. consumers are taking to cigarette price increases.

"Price increases accelerated the volume decline seen in the first quarter," Gregg Warren, an analyst at Morningstar said of Altria.

A day earlier, Altria rival Reynolds American Inc said its volume decline slowed in the second quarter from the first, easing concerns over how much price increases would hurt the U.S. market. . . .

BAT, like other cigarette groups, has seen some western European markets decline, with smoking bans taking effect in public places and high excise taxes. But it has seen strong growth in emerging markets such as eastern Europe and Asia.

Altria, which spun off Philip Morris International Inc in March, does not have emerging markets to fall back on as it faces declining U.S. cigarette consumption, more local government smoking bans and higher cigarette taxes.

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