Pact Group said it is facing softening demand in the current (fourth) quarter, citing Donald Trump’s tariffs, the ongoing domestic cost of living pressures, and supply chain disruption with shipping container supply tightening.
However, its figures for the first nine months are all up, with sales rising by 2.7 per cent over the same period last year, and underlying earnings before interest and tax up by 7.7 per cent.
Pact’s revenue in the nine months to 31 March was up by $36.2m to $1.34bn, with underlying EBIT up by $7.1m to $99.9m. The company said the improved results were the result of increased volumes in its Materials Handling and Pooling division, and the ongoing impact of its Transformation Plan cost savings programme.
For the fourth quarter though Pact said tariff tensions are causing order delays or changing customer buying decisions; and that the high cost of living is continuing to impact consumer demand and buying patterns. It also said it is facing supply chain disruption as container availability is less reliable.
The company’s debt rose by $24m, or 4.7 per cent, to take it to $533.9m, with the company currently refinancing its debt, a process it anticipates to be complete by July, six months ahead of its current debt expiry dates.
Pact has appointed an advisor to review its Asian packaging and closures business, which forms part of the Packaging & Sustainability segment, including the potential divestment of that business. It has not yet made any decision in relation to the Asian packaging and closures business, and said there is no certainty that it will proceed with a sale.
The court case over Pact’s disputed payments to TIC Retail Accessories, which was listed for trial in the Supreme Court of Victoria in April, has been put back, and is expected to be re-fixed later in 2025 or in 2026.
Former owners of coat hangers and retail security tags company TIC Group, David Harris and Mark Gandur, are in dispute with Geminder over a $30m earn out payment for their business, which they sold to him in 2018. Harris and Gandur took a six per cent strategic stakeholding in Pact during Geminder’s attempted buyout, in what proved to be a successful attempt to block his intentions.
