O-I’s European shipments increased in the first quarter 2021 due to growth in wine and spirits categories.
European shipments increased by 9.9% (in tons) primarily due to strong growth in this industry.
The company’s net sales were $1.7 billion in the first quarter of 2022 compared to $1.5 billion in the prior year quarter. Divestitures reduced net sales by $4 million.
Unfavourable foreign currency translation decreased net sales by $37 million while other sales improved $20 million driven by higher machine part sales to third parties.
Andres Lopez, O-I Glass CEO, said: “O-I reported strong first quarter results that significantly exceeded guidance and demonstrated our agility to navigate elevated market uncertainty and volatility.
“Shipments increased 6.4% compared to the prior year period and strengthened over the course of the quarter. Operating and cost performance surpassed our expectations as improved manufacturing speed and efficiency increased production to support robust demand amid record low inventory levels. Likewise, the benefit of higher selling prices more than offset elevated cost inflation.”
Segment operating profit was $231 million in the first quarter of 2022 compared to $175 million in the prior year.
In the Americas, segment operating profit was $129 million compared to $100 million in the first quarter of 2021. Shipments increased 3.1% (in tons) and the benefit of higher selling prices more than offset cost inflation. Operating costs were also lower than the prior year period.
On the ESG front, more than 30% of the company’s electricity use is now supplied from renewable sources. The company’s Glass Advocacy campaign scored over 500 million digital impressions in the first quarter alone.
OI’s efforts to improve its glass melting technology, known as the MAGMA programme, are currently under development along with its expansion plans. This is to enable profitable growth despite ongoing supply chain issues.
The company’s Colombia and Canada projects remain on track to add much needed new capacity in early 2023. As part of its Portfolio Optimisation program, OI has completed or entered into sales agreements totalling $1.3 billion including the recently completed Colombian tableware business sale.
Mr Lopez concluded: “We are increasingly optimistic on our full-year business outlook as we continue to navigate challenging macro conditions with agility. Demand for healthy, sustainable glass containers remains strong, operating performance is solid and we are effectively raising prices to offset cost inflation.”