Amcor reports second quarter and first half result. Reaffirms fiscal 2025 outlook

December 2024 Quarter Highlights:

• Further sequential improvement in year over year volume growth;
• Net sales of $3,241 million;
• GAAP Net income of $163 million; GAAP diluted earnings per share (EPS) of 11.3 cps;
• Adjusted EBIT of $363 million, up 5% on a comparable constant currency basis;
• Adjusted EPS of 16.1 cps, up 5% on a comparable constant currency basis; and
• Announced highly complementary and financially compelling combination with Berry Global

• Net sales of $6,594 million;
• GAAP Net income of $354 million; GAAP diluted EPS of 24.4 cps;
• Adjusted EBIT of $728 million, up 4% on a comparable constant currency basis; and
• Adjusted EPS of 32.2 cps, up 5% on a comparable constant currency basis.

• Adjusted EPS of 72-76 cents per share; Adjusted Free Cash Flow of $900-1,000 million.

Shareholder returns

Dividend

The Amcor Board of Directors today declared a quarterly cash dividend of 12.75 cents per share (compared with 12.5 cents per share in the same quarter last year). The dividend will be paid in US dollars to holders of Amcor's ordinary shares trading on the NYSE. Holders of CDIs trading on the ASX will receive an unfranked dividend of 20.40 Australian cents per share, which reflects the quarterly dividend of 12.75 cents per share converted at an AUD:USD average exchange rate of 0.6251 over the five trading days ended January 31, 2025.

The ex-dividend date will be February 25, 2025 for holders of CDIs trading on the ASX and February 26, 2025 for holders of shares trading on the NYSE. For all shareholders, the record date will be February 26, 2025 and the payment date will be March 18, 2025.

Financial results - Six Months Ended December 31, 2024

Segment information

Six months ended December 31, 2024:

Net sales of $6,594 million were 1% lower than last year on a reported basis, including an unfavorable impact of approximately 1% related to movements in foreign exchange rates. The pass through of lower raw material costs had no material impact on net sales.

Volumes were up 2% compared with the same six month period last year. Price/mix had an unfavorable impact of approximately 3%, primarily due to expected lower volumes in high value healthcare categories. On a comparable constant currency basis, net sales were down less than 1% compared with last year.

Adjusted EBIT of $728 million was 4% higher than last year on a comparable constant currency basis reflecting higher volumes and strong cost performance, partly offset by unfavorable impacts from price/mix. Adjusted EBIT margin improved to 11.0%, a 40 basis point increase over the prior year.

December 2024 quarter:

Net sales of $3,241 million were in line with last year on a reported basis, including an unfavorable impact of approximately 1% related to movements in foreign exchange rates and a favorable impact of 1% related to the pass through of higher raw material costs of approximately $20 million.

Volumes were up 2.3% compared with last year, improving on first quarter year over year volume growth of 1.6% and the fourth consecutive quarter of sequential volume improvement. As expected, destocking continued in healthcare and demand remained soft in the North America beverage business through the December quarter, unfavorably impacting overall volumes by more than 1%. Across the balance of the business, overall volume growth was consistent with the first quarter, up approximately 4%. Price/mix had an unfavorable impact of approximately 2% primarily due to lower volumes in high value healthcare categories. On a comparable constant currency basis, sales returned to growth in the December quarter and were marginally higher than last year.

Adjusted EBIT of $363 million was approximately 5% higher than last year on a comparable constant currency basis.

Higher volumes, continued strong cost performance and benefits from restructuring initiatives were partly offset by unfavorable impacts from price/mix. Adjusted EBIT margin improved to 11.2%, a 40 basis point increase over the prior year.

Volumes were up approximately 3% compared with the prior year with continued growth across all key regions. As expected, destocking continued in healthcare, unfavorably impacting overall segment volumes by approximately 1%. Across the balance of the Flexibles business, overall volumes were approximately 4% higher than the prior year. Price/mix had an unfavorable impact on net sales of approximately 2%, primarily due to lower volumes in high value healthcare categories. On a comparable constant currency basis net sales were approximately 1% higher than last year.

In North America, net sales grew at low single digit rates on a comparable constant currency basis driven by mid single digit volume growth, partly offset by unfavorable price/mix. Volumes were higher across a broad range of categories including meat, dairy, liquids and fresh & frozen foods and this was partly offset by lower volumes in categories including snacks & confectionary and pharmaceutical.

In Europe, net sales grew at low single digit rates on a comparable constant currency basis driven by mid single digit volume growth, partly offset by unfavorable price/mix. Volumes were higher in the dairy, single serve coffee, home & personal care and pet care end markets and this was partly offset by lower volumes in categories including snacks & confectionary and healthcare.

Across Asia, net sales grew at high single digit rates on a comparable constant currency basis driven by mid single digit volume growth and modest price/mix benefits. Volumes were higher in China and across the South East Asia region. In Latin America, net sales on a comparable constant currency basis grew at low single digit rates primarily driven by favorable price/mix benefits. Volumes were broadly in line with last year.

Adjusted EBIT of $322 million was 4% higher than last year on a comparable constant currency basis. The positive impact of higher volumes and strong cost performance was partly offset by unfavorable price/mix. Adjusted EBIT margin of 12.8% was 20 basis points higher than last year.

Volumes were up approximately 3% compared with the prior year with growth delivered across all key regions. Destocking in healthcare categories unfavorably impacted overall segment volumes by approximately 1%. Price/mix had an unfavorable impact on net sales of approximately 3%, primarily due to lower volumes in high value healthcare categories. On a comparable constant currency basis net sales were in line with last year.

In North America, net sales were up low single digits on a comparable constant currency basis, driven by low to mid single digit volume growth partly offset by unfavorable price/mix.

In Europe, net sales were in line with last year on a comparable constant currency basis, driven by mid single digit volume growth offset by unfavorable price/mix.

Across Asia, net sales on a comparable constant currency basis and volumes increased at mid single digit rates with growth in India and China partly offset by lower volumes in South East Asia. In Latin America, net sales on a comparable constant currency basis and volumes increased at low to mid single digit rates, largely driven by growth in Brazil and Peru.

Adjusted EBIT of $651 million was approximately 4% higher than last year on a comparable constant currency basis. The positive impact of higher volumes, favorable cost performance and benefits from restructuring initiatives was partly offset by unfavorable price/mix. Adjusted EBIT margin of 12.9% was 30 basis points higher than last year.

On a comparable constant currency basis, net sales were approximately 1% lower than last year reflecting an unfavorable price/mix impact of approximately 2% partly offset by approximately 1% higher volumes.

As expected, consumer and customer demand remained soft and variable in the North America beverage business and volumes and comparable net sales declined at mid single digit rates. In Latin America, net sales were up mid single digits on a comparable constant currency basis reflecting favorable price/mix. Across the balance of the Rigid Packaging business volumes were higher than last year.

Adjusted EBIT of $53 million was 10% higher than last year on a comparable constant currency basis, reflecting benefits from continued cost actions and higher volumes, partly offset by unfavorable price/mix. Adjusted EBIT margin of 7.3% was 70 basis points higher than last year.

On a comparable constant currency basis, net sales were approximately 3% lower than last year reflecting approximately 2% lower volumes and an unfavorable price/mix impact of approximately 1%.

North America beverage comparable net sales and volumes declined at mid single digit rate. In Latin America, comparable net sales were up mid single digits, primarily reflecting favorable price/mix benefits. Across the balance of the Rigid Packaging business volumes were higher than last year.

Adjusted EBIT of $115 million was approximately 6% higher than last year on a comparable constant currency basis, with the impact of lower volumes and unfavorable price/mix more than offset by benefits from cost actions. Adjusted EBIT margin of 7.5% was 60 basis points higher than last year.

Net interest and income tax expense

For the six months ended December 31, 2024, net interest expense of $147 million compares with $153 million last year. GAAP income tax expense was $101 million compared with $67 million last year. Adjusted tax expense for the six months ended December 31, 2024 of $108 million compared with $99 million last year. Adjusted tax expense for the six months ended December 31, 2024 represents an effective tax rate of 18.6%, compared with 18.0% in the prior year.

Adjusted Free Cash Flow

For the six months ended December 31, 2024, adjusted free cash outflow was $38 million, in line with the company's expectations and compares with an inflow of $52 million last year.

Net debt was $6,496 million at December 31, 2024 and leverage, measured as net debt divided by adjusted trailing twelve month EBITDA, was 3.3 times and in line with expectations. Leverage is expected to be at or below 3.0x at June 30, 2025.

Fiscal 2025 Guidance reaffirmed

For the twelve month period ending June 30, 2025, the Company continues to expect:

• Adjusted EPS of approximately 72 to 76 cents per share, which represents comparable constant currency growth of 3% to 8% (includes approximately 4% headwind related to normalization of incentive compensation payments) compared with 70.2 cents per share in fiscal 2024.
  • Assuming current exchange rates prevail through fiscal 2025, movements in exchange rates are not expected to have a material impact on reported EPS.
• Adjusted Free Cash Flow of approximately $900 million to $1,000 million.

Conference Call

Amcor is hosting a conference call with investors and analysts to discuss these results on Tuesday February 4, 2025 at 8:00am US Eastern Standard Time / Wednesday February 5, 2025 at 12:00am Australian Eastern Daylight Time. Investors are invited to listen to a live webcast of the conference call at our website, www.amcor.com, in the "Investors" section.

Those wishing to access the call should use the following toll-free numbers, with the Conference ID: 2990465

• USA: 800 715 9871 (toll free)
• USA: 646 307 1963 (local)
• Australia: 1800 519 630 (toll free), 02 9133 7103 (local)
• United Kingdom: 0800 358 0970 (toll free), 020 3433 3846 (local)
• Singapore: +65 3159 5133 (local)
• Hong Kong: +852 3002 3410 (local)

A replay of the webcast will also be available in the 'Investors" section at www.amcor.com following the call.

About Amcor

Amcor is a global leader in developing and producing responsible packaging solutions across a variety of materials for food, beverage, pharmaceutical, medical, home and personal-care, and other products. Amcor works with leading companies around the world to protect products, differentiate brands, and improve supply chains. The Company offers a range of innovative, differentiating flexible and rigid packaging, specialty cartons, closures and services. The company is focused on making packaging that is increasingly recyclable, reusable, lighter weight and made using an increasing amount of recycled content. In fiscal year 2024, 41,000 Amcor people generated $13.6 billion in annual sales from operations that span 212 locations in 40 countries. NYSE: AMCR; ASX: AMC

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