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Amcor plc 8-K Report, Financial Results (Aug 15, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed August 15, 2024
Period End
August 15, 2024
Securities
AMCRAMCCF
In the record · 2019–202610-K810-Q228-K86

AMCR filed 8 annual reports (10-K), 22 quarterly reports (10-Q) and 86 current reports (8-K) between 2019 and 2026.

  1. Deal closed8-K · Jun ’19Jun ’19
  2. Leadership change8-K · Aug ’20Aug ’20
  3. Material agreement8-K · Apr ’22Apr ’22
  4. Auditor change8-K · Aug ’26Aug ’26

01—Abstract

Summary

Summary of the 8-K filed August 15, 2024. Cited figures are marked; the original filing is the authoritative source.

Amcor plc (NYSE: AMCR; ASX: AMC) reported fiscal 2024 results (twelve months ended June 30, 2024) and provided fiscal 2025 guidance on August 15, 2024.

Net sales fell 7% reported to $13,640 milliona (down 6% on a comparable constant currency basis) as volumes declined roughly 5%, driven by destocking and soft demand in healthcare and North American beverage. Adjusted EBIT was $1,560 million, down 1% on a comparable constant currency basis, while adjusted EPS of 70.2 cents declined 2% on the same basis. GAAP net income was $730 million, or 50.5 cents per diluted share.

Adjusted free cash flow of $952 millionb came in at the top end of guidance and rose 12% year over year, supported by working capital improvement. Net debt was $6,111 million, with leverage at 3.1 times. The June 2024 quarter was the key positive.

Volumes returned to year-over-year growth (up 1%, a 5-point sequential improvement), adjusted EBIT rose 4% on a comparable constant currency basis, and adjusted EPS rose 9%, ahead of management's April expectations. Cost and restructuring benefits exceeded $110 millionc in the quarter. Management said the underlying business is improving, though the healthcare and North American beverage categories remained weak.

For fiscal 2025, management guided to adjusted EPS of 72 to 76 cents, implying comparable constant currency growth of 3% to 8% after a roughly 4% headwind from normalizing incentive compensation. Adjusted free cash flow is guided to $900 to $1,000 milliond. Management reiterated its capital allocation priorities of investing for organic growth, pursuing acquisitions or share repurchases, and maintaining a growing dividend.

The annual dividend was raised to 50.0 cents per share, and only about $30 million of shares were repurchased in fiscal 2024. Peter Konieczny is serving as Interim CEO.

02—Key points

Key Highlights

  1. Fiscal 2024 net sales of $13,640 million declined 7% reported and 6% on a comparable constant currency basis, with volumes down roughly 5%.
  2. June quarter returned to volume growth (+1%) and adjusted EPS grew 9% to 21.1 cents, ahead of management's April expectations.
  3. Adjusted EBIT of $1,560 million was down 1% on a comparable constant currency basis; GAAP net income of $730 million equals 50.5 cents diluted EPS.
  4. Adjusted free cash flow of $952 million was at the top of the $850-950 million guidance range and up 12% year over year, driven by working capital improvement.
  5. FY25 guidance calls for adjusted EPS of 72-76 cents (3-8% comparable constant currency growth) and adjusted free cash flow of $900-1,000 million.
  6. Shareholder returns of roughly $750 million in FY24 included dividends (annual dividend raised to 50.0 cents) and only about $30 million of buybacks; leverage was 3.1x net debt to EBITDA.
  7. Segment divergence: Flexibles adjusted EBIT was flat at $1,395 million with a 13.5% margin, while Rigid Packaging adjusted EBIT fell 4% (CCC) to $259 million, weighed down by North American beverage volumes that fell 12%.

03—Questions

Frequently Asked Questions

  1. Did Amcor's underlying business improve in the fourth quarter of fiscal 2024?

    Yes. Volumes grew about 1% year over year in the June 2024 quarter after declining in prior periods, a sequential improvement of 5 percentage points. Adjusted EBIT rose 4% on a comparable constant currency basis and adjusted EPS rose 9%, with cost and restructuring benefits exceeding $110 million. Weakness persisted in healthcare categories and North American beverage.

  2. Why did reported net sales fall 7% in fiscal 2024?

    The decline was mainly driven by lower volumes (about 5%), unfavorable price/mix (about 1%), and a roughly $220 million pass-through of lower raw material costs, which reduced reported sales by about 1%. Items affecting comparability and a favorable currency effect of about 1% were partial offsets.

  3. What does the FY25 guidance imply for investors?

    Management guided adjusted EPS of 72-76 cents, which is 3-8% comparable constant currency growth from 70.2 cents, and adjusted free cash flow of $900-1,000 million. Guidance includes an approximately 4% headwind from normalizing incentive compensation payments. Net interest expense is expected at $290-305 million and the effective tax rate at 19-20%.

  4. How is Amcor returning cash to shareholders and managing its balance sheet?

    Amcor returned about $750 million in fiscal 2024, mostly through dividends, and raised the annual dividend to 50.0 cents per share. Share repurchases were limited to about $30 million. Net debt was $6,111 million at June 30, 2024, with leverage of 3.1 times, which management described as in line with expectations and consistent with its investment-grade commitment.

04—Continue

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