O-I Glass, Inc. (“O-I”) (NYSE: OI) today reported financial results for the third quarter ended September 30, 2020.
“After a very challenging second quarter due to the pandemic, earnings rebounded strongly during the third quarter. Sales volumes recovered very well reflecting consumers’ affinity for healthy and sustainable glass packaging. Likewise, continued strong operating performance substantially offset the impact of lower production levels as capacity was gradually restarted following a disruptive second quarter. Despite the ongoing pandemic, the company generated strong operating results and continued favorable cash flow,” said Andres Lopez, O-I CEO.
“O-I continued to advance its strategy to create long-term value. The turnaround initiatives gained momentum and contributed to the company’s strong operating performance during the quarter. The company completed the sale of its Australia and New Zealand (“ANZ”) operations to optimize its structure, and the net proceeds were used to reduce debt and improve O-I’s financial flexibility. Paddock’s Chapter 11 filing is proceeding as expected as Paddock seeks a final resolution of its asbestos-related liabilities. Additionally, the company remains on track with the MAGMA Generation 1 installation in early 2021 that will pave the way for broader deployment starting in 2022 as we seek to revolutionize the business model for glass,” added Lopez.
Third Quarter 2020 Results
Net sales in the third quarter of 2020 were $1.6 billion compared to $1.7 billion in the prior year as net sales declined $76 million attributed to the divestment of ANZ. After adjusting for the sale of ANZ, average selling prices improved nearly 1 percent and increased revenue $12 million. Shipments increased 1.7 percent in tons, or $24 million, while unfavorable foreign currency translation reduced net sales by $11 million.
Segment operating profit1 was $204 million in the third quarter of 2020 compared to $206 million in the prior year. Higher shipments benefited segment operating profit by $10 million. Cost inflation, which was elevated due to foreign currency pressures, more than offset the benefit of higher selling prices by $4 million. Operating costs were $6 million higher than the prior year as improved operating performance and cost control efforts substantially offset the impact of lower production levels. Current year profits were unfavorably impacted by the net effect of favorable foreign currency translation and the sale of ANZ.
details at: http://investors.o-i.com/news-releases/news-release-details/o-i-reports-third-quarter-2020-results