Owens-Illinois Inc. laid out a corporate strategy that aims to reduce the company’s structural costs and increase innovation during a conference with investors Thursday.
The Perrysburg glass-container company held an “investor day” in New York City.
The seminar, which drew investors, financial analysts, and viewers on the Internet, gave executives a chance to highlight the company’s emphasis on expanding business in South America, China, and other parts of the world. Those operations would help offset slowed financial growth in the United States and Europe, they said.
The company will grow its research and development unit, with a goal of increasing Owens-Illinois’ earnings by 10 percent each year, said Al Stroucken, the firm’s chief executive officer.
A new research-and-development facility is scheduled to open in Perrysburg later in the year.
“The glass packaging market has been growing at a modest rate and we are well-positioned to take advantage of that growth,” Mr. Stroucken said.
The company is taking measures to tighten its belt and strengthen its balance sheet, Mr. Stroucken said.
Highlights from the company’s plan include:
● Increasing the company’s foothold in the emerging markets of Argentina, Brazil, China, Malaysia, and Vietnam.
● Using cash to pay down company debt; Owens-Illinois steadily has increased its free cash flow since 2010 and surpassed $250 million in 2012.
● Capitalizing on emerging markets such as craft beer and private brands in the United States and specialty juice and water in Europe.
● Reducing costs, aimed at generating $75 million in annual savings by 2015.
● Managing pension contributions, which are expected to stabilize at $75 million.
● Targeting the rising middle class in countries such as Brazil, which has had an 80 percent increase since 2003.
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