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2016-12-20

Owens-Illinois, Inc.: O-I Continues to Build Momentum on Its Transformational Journey

FOR IMMEDIATE RELEASE

For more information, contact:

Sasha Sekpeh
O-I Investor Relations
(567) 336-5128
alexandra.sekpeh@o-i.com

O-I Continues to Build Momentum on Its Transformational Journey

PERRYSBURG, Ohio (Dec. 20, 2016) - Owens-Illinois, Inc. (NYSE: OI) today
announced several significant developments in the transformational journey
that the Company outlined at investor day earlier this year. The initial
phase of the journey has been focused on enhancing financial flexibility
through proactive liability management as well as stabilizing and improving
top and bottom line business performance.

The Company has substantially improved its debt profile through the recent
issuance of a 500 million euro, eight-year, fixed-rate bond with a very
favorable coupon of 3.125 percent. This transaction met all key objectives:
increased the composition of fixed-rate debt to nearly two-thirds, augmented
the natural hedge to foreign currency exposure, repaid higher-cost
floating-rate debt and extended the Company's debt maturity profile.

Further, the Company continues to de-risk its pension plans. The Company
recently settled approximately $200 million in pension obligations of the
Owens-Illinois Hourly Retirement Plan ("Plan").[1]This transaction occurred
via the purchase of a group annuity contract with The Prudential Insurance
Company of America, a subsidiary of Prudential Financial, Inc. (NYSE:PRU)
using Plan assets that will transfer payment responsibility for retirement
benefits owed to approximately 7,500 U.S. retirees and their beneficiaries.
This settlement will reduce the Plan's pension obligations by 10 to 15
percent.

The Company also continues to reduce its asbestos-related liabilities. The
Company reported a total asbestos-related liability of $817 million on its
balance sheet at year end 2015. During 2016, asbestos payments of
approximately $125 million will reduce this liability to less than $700
million. The Company has preliminarily concluded that there will be no
adjustment to the asbestos-related liability in 2016. Next year, expected
payments of approximately $115 million will further decrease the liability.

Separately, the Company's strategic initiatives, particularly those related to
manufacturing, remain a strong contributor to year-on-year operating profit
gains. The Company continues to pivot towards the benefits of the supply
chain and commercial initiatives that will drive incremental improvements in
the next phase of the transformational journey. Regarding the top line, the
Company launched its key account management effort to positively impact
relationships with customers by adopting service levels and integrating
Company resources aligned to the needs of key clients. These efforts are
paying off. O-I has renewed global agreements with several strategic
customers, which fortifies management's confidence in volume growth in 2017.
Collaborative innovation is also taking hold. In Latin America, O-I launched
commercial sales of red glass. In North America in the coming year, O-I is
expected to launch sales of the Helix screw cork bottle, created in
partnership with cork manufacturer Amorim.

Jan Bertsch, chief financial officer, said, "We are very pleased with the
progress we are making in achieving our short and long-term financial goals.
As we wrap up 2016, we expect to be solidly within our guidance range for
adjusted earnings.[2]And, excluding asbestos payments, which relate to a
legacy liability and not to the ongoing glass container operations, our
adjusted free cash flow2for full year 2016 would be approximately $425
million. This provides a better view of the cash generation potential of our
business segments. Looking into next year and even into 2018, we anticipate
the Company's financial performance will be entirely consistent with the key
investor day metrics: continued margin expansion, 10 percent CAGR in adjusted
earnings, and solid cash flow generation."

###

About O-I

Owens-Illinois, Inc. (NYSE: OI) is the world's largest glass container
manufacturer and preferred partner for many of the world's leading food and
beverage brands. The Company had revenues of $6.2 billion in 2015 and employs
27,000 people at 80 plants in 23 countries. With global headquarters in
Perrysburg, Ohio, O-I delivers safe, sustainable, pure, iconic,
brand-building glass packaging to a growing global marketplace. For more
information, visito-i.com.

Non-GAAP Financial Measures

Management believes that its presentation and use of certain non-GAAP
financial measures, including adjusted EPS and adjusted free cash flow,
provide relevant and useful information, which is widely used by analysts,
investors and competitors in the industry, as well as by management in
assessing both consolidated and business unit performance. The information
presented regarding adjusted EPS relates to net earnings from continuing
operations attributable to the Company, exclusive of items management
considers not representative of ongoing operations because such items are not
reflective of the normal earnings of the business, divided by weighted
average shares outstanding (diluted). Management has included adjusted EPS to
assist in understanding the comparability of results of ongoing operations.
Further, the information presented regarding adjusted free cash flow relates
to cash provided by continuing operating activities less capital spending
plus asbestos-related payments and management has included adjusted free cash
flow to assist in understanding the comparability of cash flows generated by
the Company's principal business activity, which is glass container
production. It should not be inferred that the entire adjusted free cash flow
amount is available for discretionary expenditures. Management uses non-GAAP
information principally for internal reporting, forecasting, budgeting and
calculating compensation payments. Management believes that the non-GAAP
presentation allows the board of directors, management, investors and
analysts to better understand the Company's financial performance in relation
to core operating results and the business outlook. These non-GAAP measures
should be considered supplemental in nature and should not be considered in
isolation or be construed as being more important than comparable GAAP
measures.

The Company routinely posts important information on its website
-www.o-i.com/investors.

Forward-looking Statements

This document contains "forward-looking" statements within the meaning of
Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange
Act") and Section 27A of the Securities Act of 1933. Forward-looking
statements reflect the Company's current expectations and projections about
future events at the time, and thus involve uncertainty and risk. The words
"believe," "expect," "anticipate," "will," "could," "would," "should," "may,"
"plan," "estimate," "intend," "predict," "potential," "continue," and the
negatives of these words and other similar expressions generally identify
forward-looking statements. It is possible the Company's future financial
performance may differ from expectations due to a variety of factors
including, but not limited to the following: (1) the Company's ability to
integrate the Vitro Business in a timely and cost effective manner, to
maintain on existing terms the permits, licenses and other approvals required
for the Vitro Business to operate as currently operated, and to realize the
expected synergies from the Vitro Acquisition, (2) risks related to the
impact of integration of the Vitro Acquisition on earnings and cash flow, (3)
risks associated with the significant transaction costs and additional
indebtedness that the Company incurred in financing the Vitro Acquisition,
(4) the Company's ability to realize expected growth opportunities and cost
savings from the Vitro Acquisition, (5) foreign currency fluctuations
relative to the U.S. dollar, specifically the Euro, Brazilian real, Mexican
peso, Colombian peso and Australian dollar, (6) changes in capital
availability or cost, including interest rate fluctuations and the ability of
the Company to refinance debt at favorable terms, (7) the general political,
economic and competitive conditions in markets and countries where the
Company has operations, including uncertainties related to economic and
social conditions, disruptions in capital markets, disruptions in the supply
chain, competitive pricing pressures, inflation or deflation, and changes in
tax rates and laws, (8) impacts from the United Kingdom's referendum of
withdrawal from the European Union on foreign currency exchange rates and the
Company's business, (9) consumer preferences for alternative forms of
packaging, (10) cost and availability of raw materials, labor, energy and
transportation, (11) the Company's ability to manage its cost structure,
including its success in implementing restructuring plans and achieving cost
savings, (12) consolidation among competitors and customers, (13) the
Company's ability to acquire businesses and expand plants, integrate
operations of acquired businesses and achieve expected synergies, (14)
unanticipated expenditures with respect to environmental, safety and health
laws, (15) the Company's ability to further develop its sales, marketing and
product development capabilities, (16) the timing and occurrence of events
which are beyond the control of the Company, including any expropriation of
the Company's operations, floods and other natural disasters, events related
to asbestos-related claims, (17) the Company's ability to accurately estimate
its total asbestos-related liability, and (18) the Company's ability to
successfully remediate the material weakness in its internal control over
financial reporting, and the other risk factors discussed in the Company's
Amendment No. 1 to the Annual Report on Form 10-K/A for the year ended
December 31, 2015 and any subsequently filed Quarterly Report on Form 10-Q.
It is not possible to foresee or identify all such factors. Any
forward-looking statements in this document are based on certain assumptions
and analyses made by the Company in light of its experience and perception of
historical trends, current conditions, expected future developments, and
other factors it believes are appropriate in the circumstances.
Forward-looking statements are not a guarantee of future performance and
actual results or developments may differ materially from expectations. While
the Company continually reviews trends and uncertainties affecting the
Company's results of operations and financial condition, the Company does not
assume any obligation to update or supplement any particular forward-looking
statements contained in this document.

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[1]The Company expects to recognize a non-cash ...

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