Owens-Illinois Inc. (OI) expects its second-quarter adjusted
earnings will decline from a year earlier instead of remaining in
line, owing to higher-than-anticipated increases in manufacturing
and delivery costs.
The glass-container maker's shares were down 6.2% at $27.70 in
recent premarket trading.
The company reported adjusted earnings of 90 cents a share for
the year-earlier period. Analysts polled by Thomson Reuters
recently projected earnings of 85 cents for the coming period.
Owens-Corning continues to expect that global shipments will
rise 5% to 10%, mostly on acquisitions it made last year. The
company said demand remains strong across most of its end markets
with the exception of the Asia-Pacific regions--particularly in
Australia and New Zealand, where appreciating currencies and
weakening demand for beer and wine bottle shipments have been
weighing on performance.
In North America, Owens-Illinois is facing supply chain
challenges, high fuel prices and a sluggish U.S. beer market.
Owens-Illinois has been reporting falling revenue and margins
lately--with demand up globally for wine, food and spirits but
sluggish for beer bottles in its more mature markets.
The company said it expects that its segment operating margins
will fall between 3 and 6 percentage points from a year
earlier.
The company, which intends to release second-quarter results
July 28, plans to give further details Wednesday at the Deutsche
Bank Global Industries and Basic Materials Conference.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481; Tess.Stynes@dowjones.com