O-I REPORTS FIRST QUARTER 2012 RESULTS: Strong operational performance, cost cutting contribute to improved profit
(Thomson Reuters ONE) -
FOR IMMEDIATE RELEASE
O-I REPORTS FIRST QUARTER 2012 RESULTS
Strong operational performance, cost cutting contribute to improved profit
PERRYSBURG, Ohio (April 25, 2012) - Owens-Illinois, Inc. (NYSE: OI) today
reported financial results for the first quarter ending March 31, 2012.
First Quarter Highlights
* Earnings: O-I reported first quarter 2012 earnings from continuing
operations attributable to the Company of $0.73 per share (diluted),
compared to $0.50 per share (diluted) in the same period of the prior year.
Adjusted net earnings (non-GAAP) were $0.73 per share, compared to $0.53 per
share in the first quarter of 2011.
* Sales and Price: Net revenue increased from the prior year due to the
successful negotiation of higher pricing to offset high cost inflation.
* Strong Operating Performance: Good manufacturing performance and cost-
cutting initiatives improved first quarter segment operating profit over the
prior year. Also, first quarter 2012 performance exceeded the prior year's
first quarter due to the non-recurrence of cost penalties associated with
flooding in Australia last year.
First quarter net sales were $1.739 billion in 2012, up from $1.719 billion in
the prior year first quarter, primarily due to higher pricing that exceeded
unfavorable foreign currency translation.
Net earnings from continuing operations attributable to the Company in the first
quarter of 2012 were $122 million, or $0.73 per share (diluted), compared with
net earnings from continuing operations in the prior year of $83 million, or
$0.50 per share (diluted). As there were no items management considers not
representative of ongoing operations in the first quarter of 2012, adjusted net
earnings also were $122 million, or $0.73 per share (diluted). These results
compared with first quarter 2011 adjusted net earnings of $89 million, or $0.53
per share (diluted). A description of items in 2011 that management considers
not representative of ongoing operations are listed in Note 1.
Commenting on the Company's first quarter, Chairman and Chief Executive Officer
Al Stroucken said,
"We are encouraged by our start in 2012. To better serve the seasonally stronger
second quarter, especially in Europe and North America, we increased production
and inventory levels in the first quarter. We also saw generally good results
from our pricing strategy and cost-cutting initiatives in all regions."
Operational Highlights
O-I reported first quarter 2012 segment operating profit of $260 million, up
from $208 million in the first quarter of 2011. Shipments (in tonnes) were flat
to slightly up in Europe, North America and South America for the quarter.
Despite this, global shipments were down nearly two percent from the prior year
first quarter due to lower shipment levels in Asia Pacific. This was largely
driven by lower sales in China as a result of several furnace rebuilds and the
residual impact from the prior closure of the Company's Guangzhou facility.
Excluding the impact of China, global sales volumes would have been flat with
the prior year first quarter. The Company benefited by $13 million in the
quarter from higher sales prices that offset inflation.
First quarter earnings benefited $22 million due to strong manufacturing
performance that resulted in high fixed cost absorption, as well as cost control
initiatives. In addition, first quarter 2012 results were improved from the
prior year due to the non-recurrence of $9 million of costs related to flooding
in Australia last year. Further, segment operating expenses were $13 million
lower from the prior year as a result of global cost reductions and the timing
of SAP-related project costs.
Corporate costs were $17 million higher in the first quarter of 2012 primarily
due to lower machine and equipment sales than in the prior year, as well as
higher incentive compensation costs.
Financial highlights
The Company reported total debt of $4.130 billion and cash of $299 million at
March 31, 2012. Net debt was $3.831 billion, an increase of $198 million from
year end 2011 and $102 million lower than the first quarter of 2011. The
increase in net debt from year end 2011 was primarily due to a $167 million use
of free cash flow to support seasonally higher working capital levels, as well
as $41 million of foreign currency translation. O-I's leverage ratio was 3.0
times net debt to EBITDA at the end of the first quarter, consistent with the
prior year first quarter. Available liquidity under the Company's global
revolving credit facility was $749 million as of March 31, 2012.
As a result of redemptions of higher cost debt in mid-2011, net interest expense
was $12 million lower in the first quarter of 2012 than the same period in the
prior year.
Asbestos-related cash payments during the first quarter of 2012 were $30
million, compared to $33 million in the first quarter of 2011.
Business outlook
Commenting on the Company's business outlook, Stroucken said, "In the second
quarter, we expect that the benefits from our pricing strategy and operational
efficiencies will continue to drive improved year-over-year financial
performance, especially in our North American region. However, we do not yet
have clarity regarding demand trends in the second half, especially in Europe,
and we will remain flexible to match our capacity to meet our customers' needs.
As a result, our financial outlook for the second half of 2012 is tracking in
line with the second half of 2011, which includes the improvements achieved late
last year."
Note 1:
The table below describes the items that management considers not representative
of ongoing operations.
$ Millions, except per-share amounts Three months ended March 31
--------------------------------
2012 2011
---------------- ---------------
Earnings EPS Earnings EPS
---------------- ---------------
Earnings from Continuing Operations $122 $0.73 $83 $0.50
Attributable to the Company
Items that management considers not
representative of ongoing operations
consistent with Segment Operating Profit
Charges for restructuring 6 0.03
Adjusted Net Earnings $122 $0.73 $89 $0.53
Company profile
Owens-Illinois, Inc. (NYSE: OI) is the world's largest glass container
manufacturer and preferred partner for many of the world's leading food and
beverage brands. With revenues of $7.4 billion in 2011, the Company is
headquartered in Perrysburg, Ohio, USA, and employs more than 24,000 people at
81 plants in 21 countries. O-I delivers safe, effective and sustainable glass
packaging solutions to a growing global marketplace. For more information, visit
www.o-i.com.
Regulation G
The information presented above regarding adjusted net earnings relates to net
earnings attributable to the Company exclusive of items management considers not
representative of ongoing operations and does not conform to U.S. generally
accepted accounting principles (GAAP). It should not be construed as an
alternative to the reported results determined in accordance with GAAP.
Management has included this non-GAAP information to assist in understanding the
comparability of results of ongoing operations. Management uses this non-GAAP
information principally for internal reporting, forecasting, budgeting and
calculating bonus payments. Further, the information presented above regarding
free cash flow does not conform to GAAP. Management defines free cash flow as
cash provided by continuing operating activities less capital spending (both as
determined in accordance with GAAP) and has included this non-GAAP information
to assist in understanding the comparability of cash flows. Management defines
underlying free cash flow as cash provided by continuing operating activities
less capital spending from continuing operations (both as determined in
accordance with GAAP), plus the addback of capital spending in China for
replacement capacity lost due to the closure and potential sale of certain
Chinese facilities. Management expects that the proceeds from the sale of these
certain facilities should offset most or all of the replacement capacity capital
spending in China and has included this non-GAAP information to assist in
understanding the comparability of cash flows. Management uses this non-GAAP
information principally for internal reporting, forecasting and budgeting.
Management believes that the non-GAAP presentation allows the board of
directors, management, investors and analysts to better understand the Company's
financial performance in relationship to core operating results and the business
outlook.
The Company routinely posts important information on its website - www.o-
i.com/investors.
Forward looking statements
This news release contains "forward looking" statements within the meaning of
Section 21E of the Securities Exchange Act of 1934 and Section 27A of the
Securities Act of 1933. Forward looking statements reflect the Company's current
expectations and projections about future events at the time, and thus involve
uncertainty and risk. The words "believe," "expect," "anticipate," "will,"
"could," "would," "should," "may," "plan," "estimate," "intend," "predict,"
"potential," "continue," and the negatives of these words and other similar
expressions generally identify forward looking statements. It is possible the
Company's future financial performance may differ from expectations due to a
variety of factors including, but not limited to the following: (1) foreign
currency fluctuations relative to the U.S. dollar, specifically the Euro,
Brazilian real and Australian dollar, (2) changes in capital availability or
cost, including interest rate fluctuations, (3) the general political, economic
and competitive conditions in markets and countries where the Company has
operations, including uncertainties related to the economic conditions in Europe
and Australia, the expropriation of the Company's operations in Venezuela,
disruptions in capital markets, disruptions in the supply chain, competitive
pricing pressures, inflation or deflation, and changes in tax rates and laws,
(4) consumer preferences for alternative forms of packaging, (5) fluctuations in
raw material and labor costs, (6) availability of raw materials, (7) costs and
availability of energy, including natural gas prices, (8) transportation costs,
(9) the ability of the Company to raise selling prices commensurate with energy
and other cost increases, (10) consolidation among competitors and customers,
(11) the ability of the Company to acquire businesses and expand plants,
integrate operations of acquired businesses and achieve expected synergies, (12)
unanticipated expenditures with respect to environmental, safety and health
laws, (13) the performance by customers of their obligations under purchase
agreements, (14) the Company's ability to further develop its sales, marketing
and product development capabilities, (15) the Company's ability to resolve its
production and supply chain issues in North America, (16) the Company's success
in implementing necessary restructuring plans and the impact of such
restructuring plans on the carrying value of recorded goodwill, (17) the
Company's ability to successfully navigate the structural changes in Australia,
(18) the proceeds from the land sales in China do not occur in the time schedule
or amount that the Company expects, and (19) the timing and occurrence of events
which are beyond the control of the Company, including any expropriation of the
Company's operations, floods and other natural disasters, and events related to
asbestos-related claims. It is not possible to foresee or identify all such
factors. Any forward looking statements in this document are based on certain
assumptions and analyses made by the Company in light of its experience and
perception of historical trends, current conditions, expected future
developments, and other factors it believes are appropriate in the
circumstances. Forward looking statements are not a guarantee of future
performance and actual results or developments may differ materially from
expectations. While the Company continually reviews trends and uncertainties
affecting the Company's results of operations and financial condition, the
Company does not assume any obligation to update or supplement any particular
forward looking statements contained in this news release.
Conference call scheduled for April 26, 2012
O-I CEO Al Stroucken and CFO Ed White will conduct a conference call to discuss
the Company's latest results on Thursday, April 26, 2012, at 8:30 a.m., Eastern
Time. A live webcast of the conference call, including presentation materials,
will be available on the O-I website, www.o-i.com/investors, in the
Presentations & Webcast section.
The conference call also may be accessed by dialing 888-733-1701 (U.S. and
Canada) or 706-634-4943 (international) by 8:20 a.m., Eastern Time, on April
26. Ask for the O-I conference call. A replay of the call will be available on
the O-I website, www.o-i.com/investors, for 90 days following the call.
Contacts: O-I, Erin Crandall, 567-336-2355 - Investor Relations
O-I, Stephanie Johnston, 567-336-7199 - Corporate Communications
Copies of O-I news releases are available on the O-I website at www.o-i.com.
O-I's second quarter 2012 earnings conference call is currently scheduled for
Thursday, July 26, 2012, at 8:30 a.m., Eastern Time.
# # #
1Q 2012 O-I Earnings Tables:
http://hugin.info/150659/R/1606013/508841.pdf
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(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Owens-Illinois, Inc. via Thomson Reuters ONE
[HUG#1606013]
Unternehmensinformation / Kurzprofil:
Datum: 25.04.2012 - 22:06 Uhr
Sprache: Deutsch
News-ID 139383
Anzahl Zeichen: 16009
contact information:
Town:
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Kategorie:
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