Owens-Illinois Inc. on Wednesday reported that its second quarter profits rose 82 percent to $133 million, or 81 cents a share, because of a strong operating performance and strategic pricing, particularly in its North American region.
A year ago, the Perrysburg-based glass bottle maker had a profit of just $73 million, or 43 cents a share, which was because of increased manufacturing and energy costs.
In a statement, O-I Chief Executive Officer Al Stroucken said the company's North American region successfully eliminated the manufacturing and supply chain inefficiencies that it experienced in 2011 "and re-established itself as a high-performing region."
The company had a strong quarter, even though its sales were $1.76 billion, down from $1.96 billion in the same quarter a year ago. O-I said the drop in sales was primarily because of unfavorable foreign currency translation. Higher pricing in the second quarter was offset by sales volumes that were lower than the prior year quarter, the company added.
Mr. Stroucken said he expected the year-over-year operating performance in the company's Asia Pacific region to improve in the third quarter, while he expected profitability to remain strong in the Americas. Europe, however, remains a challenging market, and O-I has taken action to balance its production with lower demand in Europe.
"To maximize our financial flexibility during this period of macroeconomic uncertainty, we have reduced our capital spending plan for the remainder of the year. We now expect at least $250 million of free cash flow in 2012," Mr. Stroucken said.