Owens-Illinois foresees making zero debt paydowns from cash flow in 2004

By Sara Rosenberg

New York, Jan. 28 - Owens Illinois Inc. anticipates no debt paydowns in 2004, company officials said in a conference call Wednesday, as cash flow will be needed elsewhere, such as to meet asbestos-related obligations on a short-term and long-term basis.

Consolidated debt at year-end 2003 was $5.4255 billion compared with $5.3462 billion at year-end 2002, an increase of $79.3 million for the year.

"We're looking to stay even," officials said during the call regarding debt levels.

During the fourth quarter of 2003, the company reduced debt by about $80 million, compared to a debt decline of about $40 million in the fourth quarter of 2002. The $80 million debt reduction was primarily due to inventory reductions and reduced capital spending.

"In view of the difficult operating environment we faced throughout 2003, adversely affecting earnings per share performance, we focused our efforts at year-end on capacity rationalization and improved working capital management," said Thomas L. Young, co-chief executive officer and chief financial officer, in a company news release.

"As a result, we were able to effect debt reduction in the fourth quarter by approximately $80 million. We plan to continue and intensify those efforts in 2004 while at the same time improving our earnings performance and seeking enhanced shareholder value through global packaging consolidation and restructuring initiatives," he said.

Owens-Illinois is a Toledo, Ohio, manufacturer of packaging products.

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