Third Quarter Performance: Improved year-over-year with notable emphasis on strong earnings leverage seen across the business.
Adjusted Earnings Per Share (EPS): Exceeded expectations for Q3, reaching $0.178, a growth of 1% year-over-year.
Net Sales: Reported a decrease of 6% on a comparable constant currency basis.
Volume Performance: Improved sequentially, with a 4% overall volume decrease primarily due to expected ongoing weakness, notably in health care categories and the North American beverage business.
EBIT: For the Flexibles segment, adjusted EBIT was $358 million, up by 5% from the previous year. Rigid Packaging also saw an increase in EBIT, emphasizing a strong focus on cost control.
Adjusted Free Cash Flow: Year-to-date performance was approximately $100 million ahead of the previous year, driven by improved working capital performance.
Future Guidance
Adjusted EPS Guidance: Increased for the full year to a range of $0.685 to $0.71 per share.
Q4 Expectations: Anticipated to exhibit mid-single-digit earnings growth on a comparable constant currency basis.
Volume Outlook: Expected to be down in the low single-digit range in Q4, primarily due to continued destocking in health care categories and weak demand in North American beverage.
Free Cash Flow: Reaffirmed guidance for adjusted free cash flow between $850 million to $950 million for the fiscal year.
Long-term Strategy: Continued commitment to returning cash to shareholders through dividends and share repurchases, totaling approximately $570 million through the first 9 months.
Trends, Market Conditions, Sentiment
Volume Trajectory: Showing signs of improvement as destocking abates across most end markets, with a particularly stronger customer demand in certain businesses.
Cost Controls: Continued focus on reducing costs and improving productivity, contributing to strong operating leverage and improved earnings.
Health Care & North American Beverage: These sectors showed continued destocking activities affecting volumes negatively, albeit with a slightly improved trajectory expected moving forward.
Market Leadership: Confidence in maintaining industry leadership and leveraging innovation capabilities for sustainable offerings.
Operational Focus: Priorities include ensuring safety and health in the workplace, staying close to key stakeholders, and sustaining operational momentum into fiscal 2025.
Notable Quotes
”Today, Amcor is the established industry leader in our key markets and geographies…” — Peter Konieczny, Interim CEO.
”Improved working capital performance through the year also resulted in a year-to-date increase in adjusted free cash flow.” — Michael Casamento, CFO.
”We believe we have turned the corner after a challenging calendar 2023…” — Peter Konieczny, Interim CEO.
”Our strategy has not changed, our agenda has not changed, and our priorities have not changed.” — Peter Konieczny, Interim CEO.
”Our Q3 volume trajectory and financial performance underscores our confidence in stronger earnings growth momentum as the challenges we faced in calendar ‘23 are put further behind us.” — Peter Konieczny, Interim CEO.
