O-I has released its second quarter results, which show that net sales were up 14% compared to last year, primarily due to the acquisition of Vitro’s food and beverage division in Mexico.
Vitro generated $234 million in net sales, which translates to 13%, due to strong domestic sales, the successful ramp up of the new furnace in Monterrey, and cost synergies.
The acquisition also positively affected the regions immediately surrounding Mexico.
Segment operating profit for North America was $10 million higher than the prior year second quarter, and Latin America enjoyed an increase of $30 million segment operating profit, more than doubling the prior year profit, despite challenging circumstances in Brazil.
In other regions, Europe reported a $9 million improvement in segment operating profit compared to the prior year.
Operating performance in Europe significantly improved in the second quarter, thanks to the efforts of the plant improvement teams in the region and more broad-based improvement in productivity and quality.
In Asia Pacific, higher sales volume and price increases contributed $5 million to segment operating profit, however, this was more than offset by a high level of planned production downtime.
Commenting on the Company's Q2 results and outlook, CEO Andres Lopez stated, "We are very pleased with the solid progress on the execution of our strategy.
“Our meaningful performance improvement is the result of significant focus on improving our efficiency, stabilising both revenue and operating performance, and continued success with the integration of the Mexico acquisition.
“In addition, we are gaining momentum by enhancing customer service, implementing a more robust end-to-end global supply chain and transforming our organisation to deliver improved quality, agility, speed, flexibility and innovation - all at a competitive price.
“We have been delivering steady improvement, which has resulted in margin expansion and a year-over-year increase in earnings. Looking ahead, we remain committed to our earnings and cash flow guidance."