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Libbey Announces First Quarter Financial Results (posted 5/15/08)

May 15, 2008
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Libbey Inc. recently announced that its sales increased 4.3% to $187.3 million in the first quarter of 2008, up from $179.5 million in the first quarter last year. Libbey reported a net loss of $3.5 million, or $0.24 per share, for the first quarter ended March 31, 2008, compared to a net loss of $1.8 million, or $0.12 per share, in the prior year quarter.

For the 2008 first quarter, North American Glass sales increased 2.2% to $127.5 million. The increase in sales was attributable to continued solid increases of over 18% in shipments to retail glassware customers in the U.S. and Canada, as well as strong sales performance in Mexico. These increases were partially offset by lower shipments to U.S. foodservice customers, which were off by over 12%. North American Other sales decreased 3.1% as shipments to Syracuse China customers were down approximately 12%, partially offset by an increase of 3% in sales of World Tableware products. International sales increased 22.2% as the result of increased sales to customers of Libbey China, Royal Leerdam and Crisal. A majority of the increased sales is attributable to Libbey China and a favorable currency impact on European sales. International sales increased approximately 8%, excluding the currency impact.

The company reported income from operations of $9.5 million during the quarter, compared to income from operations of $10.4 million in the year-ago quarter. Factors contributing to the decrease in income from operations were an unfavorable mix of sales as a result of lower foodservice sales; a $1.4 million increase in natural gas expenses; and a $2.1 million increase in depreciation partially offset by a reduction of $1.2 million in selling, general and administrative expenses.

Earnings before interest and taxes (EBIT) were $10.2 million, compared to $12.2 million in the year-ago quarter. EBIT was $7.1 million for North American Glass, compared to $10.9 million in the first quarter of 2007, as a result of the unfavorable sales mix and higher natural gas expenses. North American Other reported EBIT for the first quarter of 2008 of $3.8 million, which was flat compared to the first quarter of 2007. The first quarter 2007 results included a $1.1 million one-time gain on the sale of excess land in Syracuse, N.Y. Excluding the gain on the sale of land recorded in 2007, the increase in EBIT in 2008 is attributable to higher income from operations at World Tableware, Syracuse China and Traex. The International segment reported an EBIT loss of $0.7 million, which was a $1.8 million improvement in EBIT as compared to the year-ago quarter. The improvement in EBIT was primarily related to Libbey China being in full operation, higher international sales and improved margins partially offset by higher natural gas costs in Europe.

“We are pleased with the strength of our total sales performance,” said John F. Meier, chairman and chief executive officer. “We experienced healthy increases in U.S. and Canadian retail glassware, Crisa and Libbey China shipments during the quarter. We reported solid EBITDA performance in spite of softness in the U.S. foodservice market and higher natural gas costs. We expect second quarter sales to be in the range of $215 million to $220 million, and EBITDA to be between $30 million and $32 million. As the result of a solid first quarter, finishing on the high side of our EBITDA guidance, and given the strong retail and International sales performance offsetting the softness in the U.S. foodservice channel of distribution, we are confirming our guidance for 2008 EBITDA to be in an expected range of $113 million to $123 million.”

Visit www.libbey.com for additional details.

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