Amcor has been hit by raw materials shortages, causing it to cut back supply to some of its lower margin customers, and holding back production in the September quarter.
The company has been having to deal with tightening supply of resin, aluminium and PET plastics, with CEO Ron Delia describing the quarter as “an environment of broad supply chain disruptions.”
Net sales in the three months to September were up by 10 per cent on the prior corresponding period to US$3.42bn. The rise in sales was almost entirely due to Amcor increasing prices. Sales were up by one per cent on a constant currency basis.
Net income rose by two per cent to US$202m, with EBITDA up by six per cent to US$486m.
Delia said he anticipated the raw materials shortages easing the second half of this financial year, and said that the size of Amcor meant it was better positioned than smaller rivals to handle shortages.
Delia said, “While sales were tempered in some parts of the business by raw material shortages, we prioritised as much as possible security of supply for our customers, recovery of higher input costs and sales mix management.
“We held margins flat in our Flexibles segment, and navigated through a particularly dynamic and complex environment in the Rigid Packaging business to deliver another quarter of double-digit EPS growth. As a result, we are confident in our ability to meet our earnings growth and cash flow expectations and reaffirm guidance for the full 2022 fiscal year.”
Sales for the Flexibles business rose by 10 per cent to $US2.63bn, with Rigid Packaging up by 13 per cent to US$786m. EBIT for Flexibles was up by 13 per cent, while EBIT for Rigids fell by 12 per cent.
Looking to the future Delia said, “Regardless of short-term dynamics, we remain laser-focused on executing our strategy for long-term value creation. Over the past several years, we have established a stronger foundation for growth by strengthening our industry-leading capabilities, driving further scale advantages and leadership in every region and increasing our exposure to high value end markets. Today, Amcor is better positioned strategically than ever before, and we are confident this will enable stronger growth and sustainable value creation for all stakeholders into the future.”
Amcor is the world's biggest consumer goods packaging business, operating out of 225 plants around the world. Until two years ago it was headquarted and listed in Australia, but its US$9bn acqusiiton of Bemis saw it move to the New York Stock Exchange, which requires quarterly reporting.
