Owens-Illinois, Inc.
(
OI
) provided a sneak preview of the first-quarter 2012 results ahead
of its conference call, scheduled on April 26, 2012. The company
expects earnings per share to be above 67 cents, a 35% climb over
and above the prior-year quarter's earnings of 50 cents per share.
The upsurge is attributed to higher levels of production, pricing
actions, lower costs and cost cuts. The forecast is well ahead of
the Zacks Consensus Estimate of 50 cents for the quarter.
The company indicated higher-than-expected production in the
first quarter. Finished goods inventory levels had been upped
during the quarter to meet the upcoming seasonal sales demand,
particularly in North America and Europe, and to avoid the supply
chain inefficiencies experienced last year.
Besides, pricing actions to offset unrecovered prior-year and
current inflation have also helped results. Lower-than-expected
costs in the first quarter due to successful SAP deployment in
North America along with benefits from previous cost reduction
activities in the second half of 2011, also perked up results.
The company, during its fourth quarter earnings call, had
expressed its skepticism regarding volume performance in 2012 given
the stalemate in Europe. Owens-Illinois stated that with no
improvement in the scenario, the visibility still remains cloudy.
Owens-Illinois asserted that it will actively manage its production
levels for significant changes in sales demand patterns, and such
actions could considerably influence future financial results.
The company competes with
Silgan Holdings Inc.
(
SLGN
). Silgan is expected to report its first quarter earnings on April
26, 2012. The company expects first quarter earnings to be around
41 cents.
Headquartered in Perrysburg, Ohio, Owens-Illinois, through its
subsidiaries, manufactures and sells glass containers primarily in
Europe, North America, South America, and the Asia-Pacific.
Owens-Illinois presently retains a Zacks #3 Rank, which translates
into a short-term Hold rating.
OWENS-ILLINOIS (
OI
): Free Stock Analysis Report
SILGAN HOLDINGS (
SLGN
): Free Stock Analysis Report
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