S&P: Big Tobacco sees modest gains

Standard & Poor's said in a report that the country's two largest tobacco companies reported modest gains in 2007 despite the drop in shipment volume. That's amid a highly competitive U.S. cigarette industry facing a steep decline in shipment volume, according to the agency.

The two companies are Philip Morris USA and RJ Reynolds Tobacco.

"It appears that the combination of steadily rising prices, weak economic conditions and increased restrictions on where smokers can smoke has continued to weigh on the industry," S&P credit analyst Kenneth Shea said in a written statement.

In 2007, both companies focused on sustaining and increasing market shares for their key premium brands, the agency said.

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