The company revises its full-year outlook to reflect softer business conditions.
Net sales were $173.0 million, down 5.4 percent versus prior year, or down 3.3 percent in constant currency. A net loss of $6.6 million was down $7.3 million versus the prior year. Adjusted EBITDA (Table 1) was $6.2 million, compared to $22.9 million in the first quarter of the prior year. The company is implementing proactive measures to respond to softer business conditions, including approximately $5 million of cost reductions and lower 2017 capital spending. Strong cost controls, pricing actions in the U.S. and Mexico, new product launches, and accelerated development of e-commerce business are supporting long-term strategy to return the business to growth
“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,” said 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, we’ve begun taking proactive measures to ensure the strength of our business, and we’ve revised our full-year outlook accordingly.”
“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 organizational improvements to maintain our business strength. We’re 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.”
“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 organizational improvements to maintain our business strength. We’re 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.”