EXHIBIT 99.1
[LIBBEY LOGO] LIBBEY INC.
300 MADISON AVE
P.O. BOX 10060
TOLEDO, OH 43699
- --------------------------------------------------------------------------------
N E W S R E L E A S E
AT THE COMPANY: AT FINANCIAL RELATIONS BOARD:
- --------------- -----------------------------
KENNETH BOERGER SUZY LYNDE
VP/TREASURER ANALYST INQUIRIES
(419) 325-2279 (312) 640-6772
FOR IMMEDIATE RELEASE
THURSDAY, JULY 22, 2004
LIBBEY INC. ANNOUNCES SECOND QUARTER DILUTED EPS
OF 68 CENTS VERSUS 59 CENTS IN PRIOR-YEAR PERIOD
SALES UP 5.8 PERCENT, INCOME FROM OPERATIONS UP 25.9 PERCENT
TOLEDO, OHIO, JULY 22, 2004--LIBBEY INC. (NYSE: LBY) announced that its diluted
earnings per share for the second quarter ended June 30, 2004, were 68 cents on
sales of $135.8 million. The Company reported increased sales, higher income
from operations, and an increase of 18.4 percent in net income as compared to
the prior-year period.
SECOND-QUARTER RESULTS
For the quarter-ended June 30, 2004, sales increased 5.8 percent to $135.8
million from $128.3 million in the year-ago quarter. The increase in sales was
attributable to growth in sales to customers in the foodservice, retail and
export channels of distribution. Shipments to foodservice customers of Libbey
glassware, Syracuse China dinnerware, World Tableware products, and Traex
products were all higher than the year-ago period. Sales to retail customers
increased over 8 percent, as compared to the year-ago quarter.
The Company recorded income from operations of $16.1 million during the quarter.
This compares with income from operations of $12.8 million in the year-ago
quarter. Factors contributing to the 25.9 percent increase were higher sales to
customers, improved capacity utilization and efficiencies in the manufacturing
operations.
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Pretax equity earnings from Vitrocrisa, the Company's joint venture in Mexico,
were $1.5 million as compared with pretax earnings of $2.0 million in the second
quarter of 2003, as the result of flat sales and higher natural gas costs.
Interest expense decreased $0.1 million compared with the year-ago period. The
effective tax rate increased to 32.9 percent for the quarter from 30.7 percent
in the year-ago period as the result of lower federal and state income tax
credits. Net income was $9.4 million, or $0.68 per diluted share. This was a
15.3 percent increase compared with diluted earnings per share of $0.59 in the
second quarter of 2003.
SIX-MONTH RESULTS
For the six months ended June 30, 2004, sales increased 7.8 percent to $258.9
million from $240.2 million in the year-ago period. The increase in sales was
attributable to increased sales to foodservice, retail, industrial and export
customers. Sales to foodservice customers of Libbey glass products, Syracuse
China dinnerware products, Traex plastic products and World Tableware products
were all higher by at least 8 percent when compared with the first six months of
2003.
Income from operations was up 20.7 percent to $22.2 million compared with $18.4
million in the year-ago period. In addition to the higher sales, other factors
that contributed to the higher income from operations included increased
capacity utilization and improved manufacturing efficiencies.
Equity earnings from Vitrocrisa were $0.1 million on a pretax basis as compared
to $1.8 million pretax in the year-ago period, as the result of higher natural
gas costs and increased repair expenses. Interest expense increased $0.9 million
as the result of higher average debt during the first half of 2004. The
effective tax rate increased to 33.0 percent during the first six months of 2004
from 31.2 percent in 2003 as the result of lower federal and state income tax
credits. Net income was $9.9 million, or $0.73 per diluted share, compared with
$9.9 million, or $0.71 per diluted share, in the year-ago period.
OUTLOOK FOR 2004
John F. Meier, chairman and chief executive officer, commenting on the quarter
and the Company's outlook for 2004 said, "We are pleased that we were able to
deliver solid increases in sales and earnings during the second quarter. The
continued increase in sales to our customers is encouraging." He added, "We are
reviewing our expectations for the balance of 2004 and will provide guidance
around the middle of August for the third and fourth quarters."
WEBCAST INFORMATION
Libbey will hold a conference call for investors on Thursday, July 22, 2004, at
11 a.m. Eastern Daylight Time. The conference call will be simulcast live on the
Internet on both www.libbey.com and
http://phx.corporate-ir.net/phoenix.zhtml?c=64169&p=irol-eventDetails. To listen
to the call, please go to the website at least 10 minutes early to
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register, download and install any necessary software. A replay will be
available for 7 days after the conclusion of the call.
The above information includes "forward-looking" statements as defined in the
Private Securities Litigation Reform Act of 1995. Such statements only reflect
the Company's best assessment at this time and are indicated by words or phrases
such as "goal," "expects," "believes," "will," "estimates," "anticipates," or
similar phrases. Investors are cautioned that forward-looking statements involve
risks and uncertainty, that actual results may differ materially from such
statements, and that investors should not place undue reliance on such
statements.
Important factors potentially affecting performance include but are not limited
to: increased competition from foreign suppliers endeavoring to sell glass
tableware in the United States and Mexico, including the impact of lower duties
for imported products; major slowdowns in the retail, travel or entertainment
industries in the United States, Canada, Mexico and Western Europe, caused by
terrorist attacks or otherwise; significant increases in per-unit costs for
natural gas, electricity, corrugated packaging, and other purchased materials;
higher interest rates that increase the Company's borrowing costs; protracted
work stoppages related to collective bargaining agreements; increases in expense
associated with higher medical costs, increased pension expense associated with
lower returns on pension investments and increased pension obligations;
devaluations and other major currency fluctuations relative to the U.S. dollar
and the Euro that could reduce the cost competitiveness of the Company's
products compared to foreign competition; the effect of high inflation in Mexico
and exchange rate changes to the value of the Mexican peso and the earnings and
cash flow of the Company's joint venture in Mexico, Vitrocrisa, expressed under
U.S. GAAP; the inability to achieve savings and profit improvements at targeted
levels in the Company's operations or within the intended time periods; whether
the Company completes any significant acquisition, and whether such acquisitions
can operate profitably.
Libbey Inc.:
- - is a leading producer of glass tableware in North America;
- - is a leading producer of tabletop products for the foodservice industry;
- - exports to more than 75 countries; and,
- - provides technical assistance to glass tableware manufacturers around the
world.
Based in Toledo, Ohio, the Company operates glass tableware manufacturing plants
in the United States in California, Louisiana, and Ohio and in the Netherlands.
Its Royal Leerdam subsidiary, located in Leerdam, Netherlands, is among the
world leaders in producing and selling glass stemware to retail, foodservice and
industrial clients. In addition, Libbey is a joint venture partner in the
largest glass tableware company in Mexico. Its Syracuse China subsidiary
designs, manufactures and distributes an extensive line of high-quality ceramic
dinnerware, principally for foodservice establishments in the United States. Its
World Tableware subsidiary imports and sells a full-line of metal flatware and
holloware and an assortment of ceramic dinnerware and other tabletop items
principally for foodservice establishments in the United States. Its Traex
subsidiary,
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located in Wisconsin, designs, manufactures and distributes an extensive line of
plastic items for the foodservice industry. In 2003, Libbey Inc.'s net sales
totaled $513.6 million.
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LIBBEY INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per-share amounts)
(unaudited)
THREE MONTHS ENDED
Percent
June 30, 2004 June 30, 2003 Change
------------- ------------- ------
Net sales $ 135,752 $ 128,254 5.8%
Freight billed to customers 564 529
Royalties and net technical assistance 712 640
--------- ---------
Total revenues 137,028 129,423 5.9%
Cost of sales 103,394 99,085
--------- ---------
Gross profit(1) 32,922 29,698 10.9%
Selling, general and administrative expenses 17,486 17,514
--------- ---------
Income from operations(2) 16,148 12,824 25.9%
Equity earnings -- pretax 1,456 1,997
Other (expense) income (124) 210
--------- ---------
Earnings before interest and income taxes 17,480 15,031 16.3%
Interest expense -- net 3,516 3,611
--------- ---------
Income before income taxes 13,964 11,420 22.3%
Provision for income taxes 4,599 3,510
--------- ---------
Net income $ 9,365 $ 7,910 18.4%
========= =========
Net income per share:
Basic $ 0.68 $ 0.59
========= =========
Diluted $ 0.68 $ 0.59 15.3%
========= =========
Weighted average shares:
Outstanding 13,678 13,307
========= =========
Diluted 13,699 13,318
========= =========
SIX MONTHS ENDED
Percent
June 30, 2004 June 30, 2003 Change
------------- ------------- ------
Net sales $ 258,875 $ 240,157 7.8%
Freight billed to customers 1,055 963
Royalties and net technical assistance 1,404 1,390
--------- ---------
Total revenues 261,334 242,510 7.8%
Cost of sales 204,692 189,864
--------- ---------
Gross profit(1) 55,238 51,256 7.8%
Selling, general and administrative expenses 34,479 34,280
--------- ---------
Income from operations(2) 22,163 18,366 20.7%
Equity earnings -- pretax 67 1,847
Other (expense) income (317) 336
--------- ---------
Earnings before interest and income taxes 21,913 20,549 6.6%
Interest expense -- net 7,092 6,152
--------- ---------
Income before income taxes 14,821 14,397 2.9%
Provision for income taxes 4,891 4,486
--------- ---------
Net income $ 9,930 $ 9,911 0.2%
========= =========
Net income per share:
Basic $ 0.73 $ 0.71
========= =========
Diluted $ 0.73 $ 0.71 2.8%
========= =========
Weighted average shares:
Outstanding 13,653 13,883
========= =========
Diluted 13,682 13,899
========= =========
(1) Gross profit is net sales plus freight billed to customers less cost of
sales.
(2) Gross profit plus Royalties and net technical assistance income less
Selling, general and administrative expenses
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LIBBEY INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
June 30, 2004 December 31, 2003 June 30, 2003
------------- ----------------- -------------
(unaudited) (unaudited)
ASSETS
Cash $ 2,355 $ 2,750 $ 5,862
Accounts receivable 63,380 57,122 56,535
Inventories 134,297 125,696 123,520
Other current assets 10,947 10,610 12,993
-------- -------- --------
Total current assets 210,979 196,178 198,910
Investments 87,754 87,574 84,596
Other assets 40,682 40,745 39,754
Goodwill 52,917 53,133 61,228
Net property, plant and equipment 174,183 173,486 163,348
-------- -------- --------
Total assets $566,515 $551,116 $547,836
======== ======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Notes payable $ 14,142 $ 611 $ 4,808
Accounts payable 35,625 40,280 32,474
Accrued liabilities 32,488 33,555 45,252
Other current liabilities 17,125 14,281 16,952
Long-term debt due within one year 115 115 115
-------- -------- --------
Total current liabilities 99,495 88,842 99,601
Long-term debt 223,685 230,207 231,052
Deferred taxes and other liabilities 27,678 27,873 23,903
Pension liability 17,501 17,092 29,910
Nonpension postretirement benefits 46,986 47,245 47,633
-------- -------- --------
Total liabilities 415,345 411,259 432,099
Total shareholders' equity 151,170 139,857 115,737
-------- -------- --------
Total liabilities and shareholders' equity $566,515 $551,116 $547,836
======== ======== ========
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LIBBEY INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
(Dollars in thousands)
(unaudited)
THREE MONTHS ENDED
June 30, 2004 June 30, 2003
------------- -------------
OPERATING ACTIVITIES
Net income $ 9,365 $ 7,910
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
Depreciation and amortization 7,631 6,825
Net equity earnings (1,058) (1,471)
Change in accounts receivable (7,105) (3,122)
Change in inventories (5,432) (7,019)
Change in accounts payable 783 3,146
Other operating activities 6,294 9,487
-------- --------
Net cash provided by operating activities 10,478 15,756
INVESTING ACTIVITIES
Additions to property, plant and equipment (8,859) (6,379)
Dividends received from equity investments - 4,900
Other - 897
-------- --------
Net cash used in investing activities (8,859) (582)
FINANCING ACTIVITIES
Net bank credit facility activity (5,000) (20,000)
Payment of financing fees (838) -
Other net borrowings 6,602 2,453
Stock options exercised 88 4,765
Treasury shares purchased - (640)
Dividends (1,366) (1,325)
-------- --------
Net cash provided by financing activities (514) (14,747)
Effect of exchange rate fluctuations on cash - (24)
-------- --------
(Decrease) increase in cash 1,105 403
Cash at beginning of period 1,250 5,459
-------- --------
Cash at end of period $ 2,355 $ 5,862
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LIBBEY INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
(Dollars in thousands)
(unaudited)
SIX MONTHS ENDED
June 30, 2004 June 30, 2003
------------- -------------
OPERATING ACTIVITIES
Net income $ 9,930 $ 9,911
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
Depreciation and amortization 15,443 13,732
Net equity earnings (127) (1,479)
Change in accounts receivable (6,258) (6,591)
Change in inventories (8,601) (13,886)
Change in accounts payable (4,655) 841
Other operating activities 5,400 4,206
--------- ---------
Net cash provided by operating activities 11,132 6,734
INVESTING ACTIVITIES
Additions to property, plant and equipment (17,026) (11,093)
Dividends received from equity investments - 4,900
Other - 897
--------- ---------
Net cash used in investing activities (17,026) (5,296)
FINANCING ACTIVITIES
Net bank credit facility activity (5,000) (61,872)
Senior notes - 100,000
Payment of financing fees (838) (663)
Other net borrowings 13,738 2,088
Stock options exercised 328 4,841
Treasury shares purchased - (38,888)
Dividends (2,728) (2,788)
--------- ---------
Net cash provided by financing activities 5,500 2,718
Effect of exchange rate fluctuations on cash (1) 23
--------- ---------
(Decrease) increase in cash (395) 4,179
Cash at beginning of year 2,750 1,683
--------- ---------
Cash at end of period $ 2,355 $ 5,862
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LIBBEY INC.
CONDENSED CONSOLIDATED JOINT VENTURE STATEMENTS OF INCOME
(Dollars in thousands)
(unaudited)
THREE MONTHS ENDED
June 30, 2004 June 30, 2003
------------- -------------
Net sales $ 48,490 $ 48,260
Cost of sales 39,270 35,930
-------- --------
Gross profit 9,220 12,330
Selling, general and administrative expenses 5,650 5,963
-------- --------
Income from operations 3,570 6,367
Translation gain (loss) 507 (727)
Other income (expense) (22) (216)
-------- --------
Earnings before interest and taxes 4,055 5,424
Interest expense 1,083 1,349
-------- --------
Income before income taxes 2,972 4,075
Income taxes 813 1,075
-------- --------
Net income $ 2,159 $ 3,000
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</Table>
<Table>
<Caption>
SIX MONTHS ENDED
June 30, 2004 June 30, 2003
------------- -------------
Net sales $ 90,968 $ 86,547
Cost of sales 77,588 68,929
-------- --------
Gross profit 13,380 17,618
Selling, general and administrative expenses 11,016 10,819
-------- --------
Income from operations 2,364 6,799
Translation gain (loss) 327 (80)
Other income (expense) (123) (208)
-------- --------
Earnings before interest and taxes 2,568 6,511
Interest expense 2,430 2,743
-------- --------
Income before income taxes 138 3,768
Income taxes (120) 751
-------- --------
Net income $ 258 $ 3,017
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The Company is a 49% equity owner in Vitrocrisa Holding, S. de R.L. de C.V. and
related Mexican companies (Vitrocrisa), which manufacture, market and sell glass
tableware (beverageware, plates, bowls, serveware and accessories) and
industrial glassware (coffee pots, blender jars, meter covers, glass covers for
cooking ware and lighting fixtures sold to original equipment manufacturers) and
a 49% equity owner in Crisa Industrial, L.L.C., a domestic distributor of
industrial glassware for Vitrocrisa in the U.S. and Canada. Summarized combined
statements of income for the Company's investments, accounted for by the equity
method under U.S. GAAP, is shown above.
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