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Owens-Illinois Q1 Profit Plunges; Sales Decline

Post Time:Apr 30,2009Classify:Company NewsView:541

Wednesday, glass container manufacturer Owens-Illinois, Inc. (OI: News ), reported a steep decline in the first-quarter profit from the year-ago period, primarily due to lower sales in the challenging market conditions. The company also said it expects second quarter 2009 adjusted net earnings to decline on a year-over-year basis.

The Perrysburg, Ohio-based company reported first-quarter net earnings of $45.1 million or $0.27 per share, down from $178.1 million or $1.04 per share in the corresponding quarter last year.

Excluding restructuring and asset impairment charges, adjusted net earnings for the quarter declined to $92.8 million or $0.55 per share from $183.7 million or $1.08 per share in the similar period last year. On average, ten analysts polled by Thomson Reuters estimated earnings of $0.36 per share for the quarter. Analysts' estimates typically exclude special items.

Earnings from continuing operations for the quarter decreased to $45.1 million or $0.27 per share from $174.0 million or $1.02 per share in the comparable quarter last year.

The company had no gain on sale of discontinued operations for the quarter compared to a gain of $4.1 million or $0.02 per share in the first quarter of fiscal 2008.

Net sales for the first-quarter of fiscal 2009 were $1.52 billion, down from $1.96 billion in the prior-year similar period. Analysts estimated revenue of $1.66 billion for the quarter.

First quarter sales reflect a year-over-year decline in shipments and the unfavorable impact of foreign currency translation despite higher average selling prices.

The company pointed out that improved selling prices and product mix contributed more than 6% to revenue, compared to the prior year, while total net sales declined mainly due to challenging market conditions.

Commenting on the company's first quarter performance, Owens-Illinois Chairman and CEO, Al Stroucken said, "We posted one of our best first quarters since our IPO in 1991, despite facing a very challenging glass market. We acted swiftly to balance our production with sharply lower demand to prevent building excess inventory and to preserve profit margins over the long term. At the same time, we successfully raised our average selling prices, which more than offset inflationary cost increases. We also reduced fixed costs as part of our strategic footprint alignment initiative."

Source: RTTNewsAuthor: shangyi

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