S&P shifts O-I Glass view to positive

S&P said it shifted its outlook for O-I Glass Inc. to positive from stable and affirmed its ratings, including the B+ issuer rating.

O-I boosted revenues by about 4.4% and increased adjusted EBITDA margins by about 200 basis points to 16.7% in 2021. The company achieved this despite inflationary pressures in the industry. Using contractual and out-of-contract pass throughs, O-I recovered $180 million of $230 million inflationary costs in 2021, the agency said.

“We believe OI will continue its top line growth in the low-single digits through both volume growth and additional pricing to offset inflation. Our base case projects the company will grow adjusted EBITDA margins into the 17% area as it improves on its pricing initiatives from the previous year,” S&P said in a press release.

However, S&P warned there are uncertainties to its forecast. “The situation in Ukraine adds a layer of unpredictability, and with about 40% of the business based in Europe, there could be greater reverberations if the conflict is drawn out.”

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