Boston, MA, 03/19/2014 – Different companies are reacting differently to the difficult retail environment. Libbey Inc. (NYSEMKT:LBY) is focusing on its retail operations so that it can counterbalance the weaknesses in retail and restaurant traffic.
Economic weaknesses and its effect:
The unusual retail activity and economy has taken a toll on several companies including Libbey Inc. (NYSEMKT:LBY). Demand for its products has been subdued as customers stay away from restaurants on account of economy as well as the extreme cold weather. Retail sales have also been affected due to the same reasons. In fact many companies in the retail chain have experiences lower sales on account of the harsh cold weather conditions. Many companies have started retrenching people to cut costs. Libbey, however, is becoming more aggressive. The company is increasing its employee tally in the sales and marketing department to push sales aggressively. It will be increasing its employees in the U.S. as well as China.
Libbey Inc. (NYSEMKT:LBY) is expanding its food service field staff by over 20% in both America as well as China. It is also expanding its sales staff in Latin America, Mexico and Europe. The company plans to step up new product launches as well as marketing efforts in its advantage businesses. Though revenues have been affected in 2013, sales were not so low that profitability margins came under pressure. The global revenues for 2013 were $818.8 million, a decline from $825.3 million in 2012. However, profits increased drastically. Against profits of just $7 million in 2012, the company reported profit of $28.5 million in 2013. This translates into $1.31 per share in 2013 against $0.33 per share in 2012. Profits were impacted by $31 million loss on account of redemption of debt in 2012.
The fourth quarter results also showed that the company gained in some quarters but lost in some. Business to business sales improved but retail sales were down 10%. The company reported growth in the Middle East, Europe and Africa. It also gained in the U.S. operations.
Though Libbey Inc. (NYSEMKT:LBY) expects a slow first quarter, it is hopeful that revenues will pick up from the second quarter.