Gifts Today magazine

Libbey Inc. announces first quarter results

Libbey Inc., one of the largest glass tableware manufacturers in the world, has reported results for the first quarter ended March 31, 2017

Libbey’s first results show net sales of US$173.0 million, down 5.4 per cent versus prior year, or down 3.3 per cent in constant currency. This is a net loss of US$6.6 million, down $7.3 million versus prior year.

Net sales were lower due to softer sales in the foodservice and retail channel, which were down approximately 4 per cent and 7 per cent, respectively. U.S. foodservice volume was up slightly in the quarter, compared to the prior-year period. Reductions in net sales in the retail and foodservice channels were partially offset by a nearly 10 per cent increase in net sales in the business-to-business channel that was driven by an increase in volume.

"Our first quarter results reflected net sales that were in line with our expectations, but a continuation of difficult end-market conditions in our foodservice and retail channels resulted in lower profitability than we anticipated during the quarter," says William A. Foley, chairman and chief executive officer. 

"Planned furnace rebuilds, the initiation of some technology investments, foreign currency, unfavorable price and product mix, and the mark-to-market impact of certain natural gas hedges, all negatively impacted profitability in the quarter.”

As a result the company is implementing proactive measures to respond to softer business conditions, including approximately $5 million of cost reductions and lower 2017 capital spending.

William adds: "While we do not foresee any improvement in the competitive environment in the near-term, we are adapting to structural shifts occurring in our markets, and we're making appropriate operational and organisational improvements to maintain our business strength.

“We are implementing strong cost controls, taking pricing actions in both the U.S. and Mexico to improve margins, continuing to enrich our product mix with new product launches, and accelerating development of our e-commerce platform to improve sales performance. 

“We're confident in the strength of our market position, and we're seeing indications of increased interest in our products in a number of regions where customers are seeking a stable supplier, as the health of some of our competitors remains uncertain. We have a great team in place working to secure a successful future, and we believe Libbey will emerge from this environment as an even stronger leader in the industry."

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