“O-I’s second quarter business performance was strong and exceeded our expectations. Demand was robust and shipment levels rebounded to pre-pandemic levels. Excluding the effect of recent divestitures, sales volume was up 18 percent from the prior year period. Likewise, the company’s performance benefited from higher production as well as continued solid operating and cost performance supported by the company’s Margin Expansion initiatives. Second quarter cash provided by operating activities was also strong reflecting solid earnings,” said Andres Lopez, CEO.
“We continued to make very good progress on our 2021 priorities through the first half of the year. Our Margin Expansion initiatives generated $40 million of benefits year-to-date and we expect full-year benefits will exceed our original target for 2021. Consistent with our goal to revolutionize glass, we successfully validated multiple R&D assumptions at our first full-scale Generation 1 MAGMA line at Holzminden Germany. We also remain on track to pilot our Generation 2 MAGMA line at Streator Illinois in the second half of the year. Likewise, our Glass Advocacy campaign has reached over 80 million people in the U.S. as we seek to rebalance the packaging narrative and share the many favorable and sustainable attributes of glass. As we optimize our structure, we are now over 80 percent complete on our $1.15 billion divestiture program which should wrap up by the end of 2022. Finally, the Paddock Chapter 11 plan of reorganization is progressing as expected consistent with the agreement-in-principle reached in April as we seek a fair and final resolution to Paddock’s legacy asbestos liabilities. All of these actions are consistent with our strategy to increase shareholder value and ensure sustainable prosperity for O-I.”
“Despite a continued volatile environment and challenges with severe weather earlier in the year, our full year 2021 adjusted earnings, cash provided from operating activities and free cash flow outlook has improved reflecting favorable market trends and the company’s continued strong operating performance,” concluded Lopez.
Net sales approximated $1.7 billion in the second quarter of 2021 which represented a $242 million increase from the prior year period. Higher average selling prices contributed $27 million to net sales. Adjusted for divestitures, shipments in tons increased 18 percent as higher sales volumes and favorable mix boosted revenues $255 million. Net sales benefited $79 million from favorable foreign currency translation. Recent divestitures reduced net sales by $111 million and revenue from technical services declined $8 million reflecting lower engineering project activity.
Segment operating profit was $232 million in the second quarter of 2021 compared to $99 million in the prior year period.
Americas: Segment operating profit in the Americas was $124 million compared to $52 million in the second quarter of 2020. Excluding divestitures, shipments in tons improved 17 percent while the benefit of higher selling prices substantially offset cost inflation. Operating costs were favorable primarily reflecting 28 percent higher production levels as well as benefits from the company’s Margin Expansion initiatives. Results included $2 million of unfavorable foreign currency translation.
Europe: Segment operating profit in Europe was $108 million compared to $42 million in the second quarter 2020. Shipments in tons improved 22 percent and the benefit of higher selling prices substantially offset cost inflation. Like the Americas, operating costs were favorable reflecting 28 percent higher production levels as well as benefits from the company’s Margin Expansion initiatives. Additionally, results benefited $4 million from favorable foreign currency translation.
Asia Pacific2: Segment operating profit in Asia Pacific was $0 compared to $5 million in the second quarter 2020 following the sale of the Australia and New Zealand (ANZ) business unit in July 2020.
details at: http://investors.o-i.com/news-releases/news-release-details/o-i-glass-reports-strong-second-quarter-2021-results