In addition, earnings were impacted by our decision to temporarily idle production in certain areas to balance fourth quarter supply with demand, consistent with the Company's plan to operate with lower inventories going forward. Furthermore, we recorded three large non-cash charges during the quarter related to our Critical Accounting Estimates. That said, the excellent cash result is testimony that we are making strides in our culture shift to focus on cash performance," said Steve McCracken, O-I Chairman and Chief Executive Officer.
Glass Containers Segment -- Improved Selling Prices and Volume Growth Offset by Cost Pressures and Selective Idling of Capacity to Reduce Inventories.
Segment Operating Profit of $144.6 million in the fourth quarter of 2005 for the Glass Containers segment declined by $50.2 million, or 25.8%, from the fourth quarter of 2004. The principal factors contributing to the decline were as follows:
$ Millions
- Price and product sales mix $ 24.9
- Unit sales volume 13.3
- Energy cost inflation (31.3)
- Raw material and other inflation (24.3)
- Idled production to balance supply with demand (20.5)
- European integration costs ( 7.5)
- Divested units (Corsico and Castellar) ( 2.6)
- Currency translation rates ( 1.9)
- All other - net ( 0.3)
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$(50.2)
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O-I Reports Fourth Quarter and Full Year Results: Strong Fourth Quarter and Full Year Cash Flow Enable Continued Debt Reduction
Date: 6 February 2006
Source: O-I
Owens-Illinois, Inc. reported its fourth quarter and full year 2005 financialresults."We are delighted with our ability to generate significant cash flow and reduce debt in the fourth quarter and full year. However, continued inflationary pressures have negatively impacted our underlying earnings.