Packaging firm Amcor has posted a 4% increase in reported net sales, to $11 billion (€9.96 billion), in the first nine months of its financial year ended 31 March 2023.
This performance includes, among others, an unfavourable impact of 4% related to movements in foreign exchange rates, and price increases of approximately $750 million (€679.7 million) related to the pass through of higher raw material costs.
On a comparable constant currency basis, net sales were 2% higher than last year, reflecting price/mix benefits of approximately 4%.
Volumes were approximately 2% lower than last year, the company noted.
Net income (GAAP) for this period was $868 million (€786.7 million), including a $215 million (€194.9 million) gain on the sale of its business in Russia.
Adjusted EBIT amounted to $1.2 billion (€1.1 billion), up 4% year-on-year on a comparable constant currency basis.
Adjusted EBIT margin stood at 10.6%, including an adverse impact of approximately 80 basis points related to the increased sales dollars associated with passing through higher raw material costs.
Third-Quarter Results
Net sales in the third quarter declined by 1% year-on-year to $3.7 billion (€3.4 billion) on a reported basis, including a 2% unfavourable impact related to movements in foreign currency exchange rates, among others.
On a comparable constant currency basis, net sales were 1% higher than the same quarter last year, reflecting price/mix benefits of approximately 4%.
Volumes were approximately 3% lower than in the third quarter last year, Amcor added.
Net income (GAAP) amounted to $177 million (€160.4 million), while the adjusted EBIT of $382 million (€346.2 million) was 2.5% lower than last year on a comparable constant currency basis.
Amcor CEO Ron Delia said, "We were cautious on market dynamics entering the third quarter and continued to take decisive price and cost actions. These efforts helped offset continued softness and increased volatility in the demand environment [...].
Outlook
Amcor has adjusted its 2023 outlook for the financial year to reflect the challenging operating environment and actions undertaken to ensure growth in earnings as it progresses through to fiscal 2024.
It now expects adjusted EPS of 72 to 74 cents per share (on a reported basis), down from its previous guidance of 77 to 81 cents per share.
The updated adjusted EPS expectations include, among others, a comparable constant currency earnings decline of 1-4%.
The company added that it was confident in the strength of its business, customer value proposition and execution capabilities.
Delia added, "Our expectation that current market conditions will persist in the near-term means we are also laser focused on continued initiatives to recover inflation, drive cost productivity and advance previously announced structural cost reductions.[...]"
"We remain focused on executing our strategy for long term value creation, which includes reinvesting in the business for organic growth, pursuing acquisitions and/or regular share repurchases and returning cash to shareholders through a compelling and growing dividend."
© 2023 European Supermarket Magazine – your source for the latest packaging news. Article by Dayeeta Das. Click subscribe to sign up to ESM: European Supermarket Magazine.
