Profits at Pact Group rose strongly, on sales that were up a smidgeon, in its first half results, with the company attributing the rise to solid organic growth and higher margins.
Net profit after tax was up by 44 per cent to $50m from $35m in the prior period, while underlying net profit after tax was up by even more, hitting $52m compared to $33m in the same period last year, a rise of 59 per cent.
Underlying EBITDA increased by 13 per cent to $164.2m, with underlying EBIT up by 25 per cent to $98.6m.
Revenue for the half year rose by 1.1 per cent to $894.4m from $885.1m in the same period last year.
Sanjay Dayal, CEO and managing director of Pact Group, said, “Our results in this period demonstrate a solid improvement in all key metrics. We have delivered strong organic growth, improved our margins, and managed our balance sheet with discipline.
“In our packaging and sustainability segment we saw improved volumes in the agricultural, industrial, health and wellness sectors. We have seen strong earnings momentum in our materials handling and pooling segment. Our contract manufacturing segment continued to benefit from strong demand for hygiene products. Demand for nutraceutical products also improved.
“We have delivered these results against a backdrop of continued operational challenges and market disruption arising from COVID-19. I am very proud.”
The company said it expects its full year EBIT to be better than last year, and says the trends it saw in the first half will continue, although its hygiene category will be weaker.
Pact said the execution of its Leading the Circular Economy strategy was on track in the first half, with its recycling capability enhanced by the acquisition of Flight Plastics in New Zealand. Additionally further plastic recycling facilities are currently being evaluated in Victoria, Queensland and Western Australia. It is also currently building a new recycling plant in Albury, which is on track to open later this year.