O-I returns to profit in '04 despite charges for asbestos

1/27/2005

Owens-Illinois Inc., which a year ago reported a loss of nearly $1 billion, said yesterday it had a profit of $235.5 million for last year, when it had a major purchase and a major sale.

The profits of Toledo's second largest corporation were reduced again by accounting charges for asbestos-injury liability, a problem that has cost the firm more than $2 billion in the last decade.

This time, O-I took a fourth-quarter charge of $152.6 million that reduced its profit by 56 cents a share. But, despite the charge, O-I's earnings came in 2 cents higher than the average of analysts' estimates.

Its per-share profit was $1.43 last year, up from its loss of $6.89 the year before.

O-I, the world's largest glass-container manufacturer, reported revenues last year of nearly $6.3 billion, up slightly from $6.2 billion a year earlier.

During 2004, O-I sold off most of its plastic-bottle operation for about $1.2 billion to Graham Packaging Co. LP, of York, Pa., and it acquired a major European glass-container maker, BSN Glasspack SA, for $1.4 billion.

For the fourth quarter, O-I reported revenue of nearly $1.8 billion, up about 20 percent from the $1.5 billion for the period a year earlier. Its profit for the quarter was $21.7 million, or 11 cents a share, versus a loss of more than $1 billion, or $7.33 a share, a year earlier.

The last quarter represented a "milestone for O-I in our turnaround," said Steven McCracken, chairman and chief executive officer, in a statement. Mr. McCracken, a former DuPont executive, took over as O-I's chief April 1.

The downtown Toledo firm said it paid off nearly $1.2 billion in debt in the fourth quarter, but at year's end the debt was still just under $5.4 billion. A year earlier, before its big acquisition, its debt was just over $5.4 billion.

Mr. McCracken's statement noted that he expects further debt reduction and higher earnings per share in 2005.

The financial report was released well after the stock markets had closed yesterday. The company's stock closed at $20.64 on the New York Stock Exchange.

Contact Homer Brickey at:

homerbrickey@theblade.com

or 419-724-6129.