Owens Illinois Inc. Earnings Cheat Sheet: Profit Down

S&P 500 (NYSE:SPY) component Owens Illinois Inc. (NYSE:OI) reported its results for the third quarter. Owens-Illinois manufactures glass containers primarily for the food and beverage industries in Europe, North America, South America, and Asia Pacific.

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Owens Illinois Earnings Cheat Sheet for the Third Quarter

Results: Net income for Owens Illinois Inc. fell to $116 million (70 cents per share) vs. $138.7 million (84 cents per share) a year earlier. This is a decline of 16.4% from the year earlier quarter.

Revenue: Rose 6.9% to $1.86 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: OI reported adjusted net income of 84 cents per share. By that measure, the company beat the mean estimate of 72 cents per share. It fell short of the average revenue estimate of $1.93 billion.

Quoting Management: Chairman and Chief Executive Officer Al Stroucken said, “We made good progress in the third quarter. Earnings were in line with the prior year and improved significantly from the second quarter due to better operating performance, especially in North America and Asia Pacific. To address market challenges in Australia, we closed a furnace at the end of September. Globally, higher year-over-year shipments and prices contributed to earnings, but were offset by high cost inflation. We used the $138 million of free cash flow generated in the quarter primarily to reduce debt. This is consistent with our goal of reducing our leverage ratio to between two and three times EBITDA.”

Key Stats:

Revenue has now gone up for three straight quarters. In the second quarter, revenue rose 14.5% to $1.96 billion while the figure rose 8.6% in the first quarter from the year earlier.

The company topped expectations last quarter after falling short of forecasts in the second quarter with net income of 59 cents versus a mean estimate of net income of 62 cents per share.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 57 cents a share to 50 cents over the last ninety days. At $2.28 per share, the average estimate for the fiscal year has fallen from $2.46 ninety days ago.

Competitors to Watch: Amcor Limited (AMCRY), Saint-Gobain Oberland AG (OLG), Cristalerias de Chile S.A (CRISTALES), and Druzhba Staklarski Zavodi AD Sofia (4DR).

Investing Insights: Here’s Why Chipotle’s Stock Keeps Winning.

(Source: Xignite Financials)