The merger between packaging giants Amcor and Berry is now complete, earlier than anticipated, with the all-scrip deal creating a company with some 400 packaging plants, and 75,000 staff, located in 140 countries.
The deal comes six years after the $9bn merger between Amcor and Beamis, and is intended to create a “global leader” in consumer and healthcare packaging solutions.
Amcor CEO Peter Konieczny said: "Today is a defining day for Amcor as we closed our transformational merger with Berry Global. Through this combination, Amcor has enhanced positions in attractive categories, a broader, more complete customer offering and expanded material science and innovation capabilities. As a result, we believe we are now uniquely positioned to deliver more consistent and sustainable organic growth and further improve margins, in line with our strategy."
As a result of the merger, Amcor is forecasting a cash flow in excess of US$3bn by 2028, which it says will fund further organic reinvestment and more acquisitions to drive its growth.
The merger completed just as Amcor released its third quarter results, which were weaker than expected, causing the company to downgrade its full year guidance. Amcor said US demand had slowed, with sales for the nine months down by two per cent, to US$9.93bn, and sales for the third quarter also down by two per cent, to US$3.3bn. However, income rose by three per cent in the nine months to US$728m. Amcor’s share price fell by 2.5 per cent on the results.
Volumes were up one per cent compared with the same nine month period last year. Amcor's price/mix had an unfavourable impact of approximately one per cent, primarily due to expected lower volumes in high value healthcare categories in the first half of the year. On a comparable constant currency basis, net sales were in line with last year.
Adjusted EBIT of US$1.1bn was three per cent higher than last year on a comparable constant currency basis. Amcor said it reflected higher volumes and strong cost performance, partly offset by unfavourable impacts from price/mix.
Volume growth in the Flexibles and Rigid Packaging segments remained in the low to mid single digit range. Flexibles saw net sales of $2.6bn in the three months to March, up modestly compared with last year. For Rigids, net sales of $728m for the quarter were 10 per cent lower than last year, due to an unfavourable impact of two per cent related to movements in foreign exchange rates, and an unfavourable impact of approximately six per cent related to the divestment of Amcor's 50 per cent interest in the Bericap JV in December.
