Amcor Plc (AMCR Quick QuoteAMCR - Free Report) reported fourth-quarter fiscal 2024 (ended Jun 30, 2024) adjusted earnings per share (EPS) of 21 cents, in line with the Zacks Consensus Estimate. The bottom line improved 9.3% from the prior-year quarter’s EPS of 19 cents, owing to year-year-year volume growth and lower costs.

Including special items, the company reported an EPS of 18 cents, up from the prior-year quarter’s EPS of 12 cents.

Total revenues for the quarter were $3.54 billion, which missed the Zacks Consensus Estimate of $3.66 billion.  Revenues were down 3.8% from the year-ago quarter, impacted by pass-through of lower raw material costs and unfavorable foreign currency translation. Price/mix was down 3% year over year, while volumes returned to growth at 1%.

Costs & Margins

The cost of sales decreased 5.8% year over year to $2.78 billion. Gross profit increased 4.4% year over year to $754 million. The gross margin was 21.3% for the quarter under review compared with 19.7% in the prior-year quarter.

SG&A expenses remained flat year over year at $329 million. Adjusted operating income in the quarter under review was $454 million, up 4.1% from $436 million in the prior-year quarter. The adjusted operating margin was 12.8% compared with 11.9% in the prior-year quarter.

Adjusted EBITDA in the quarter was $550 million in the fourth quarter of fiscal 2024 compared with $540 million in the fourth quarter of fiscal 2023. The adjusted EBITDA margin was 15.6% in the quarter under review compared with the prior-year quarter’s 14.7%.

Segment Performances

Flexibles: Net sales decreased 3.3% year over year to $2.69 billion. Volume grew 3% year over year, while the price/mix was an unfavorable 4%. Our model projected net sales of $2.83 billion based on an expectation of a year-over-year volume decline of 1.1% and a favorable price/mix of 9.8%.

The segment’s adjusted operating income moved up 4.1% year over year to $403 million, reflecting gains from a strong cost performance and restructuring actions. 

Rigid Packaging: The segment reported net sales of $849 million in the quarter, down 5.4% from the year-ago quarter. Volume was down 5% year over year, reflecting lower beverage volumes amid weak demand in key categories. This was somewhat offset by favorable price/mix impacts of 3%. We had projected net sales at $905 million, which had factored in a year-over-year volume decline of 2% and a price/mix benefit of 9.3%.

Adjusted operating income was $75 million, up 2.7% year over year, as favorable cost performance helped offset the impacts of lower volumes.

Cash Flow & Balance Sheet Updates

As of the end of fiscal 2024, Amcor had $588 million of cash and cash equivalents compared with $689 million at fiscal 2023 end. The company generated $1.32 billion in cash from operating activities in fiscal 2024 compared with $1.26 billion in the prior fiscal year.

AMCR reported an adjusted free cash outflow of $952 million in fiscal 2024 compared with $848 million in the last fiscal year.  As of Jun 30, 2023, the company’s net debt totaled $6.11 billion.

Amcor returned $750 million to shareholders through fiscal 2024 as dividends and share repurchases. The company repurchased 3 million shares for $30 million in fiscal 2024.

FY24 Performance

Amcor reported an adjusted EPS of 70 cents in fiscal 2024, in line with the Zacks Consensus Estimate. Earnings came within the company’s guidance of 68.5-71 cents. The bottom line declined 4.2% year over year.

Including special items, AMCR reported an EPS of 51 cents compared with an EPS of 71 cents in fiscal 2023.

Total revenues fell 7.2% year over year to $13.64 billion and missed the consensus estimate of $13.86 billion. On a comparable constant-currency basis, net sales were down 6%.

FY25 Guidance

Adjusted EPS for fiscal 2025 is expected to be 72-76 cents. The company projects an adjusted free cash flow of $900-1,000 million for fiscal 2025.

Price Performance

In the past year, AMCR shares have gained 19.6% compared with the industry’s 18.3% growth.

Image Source: Zacks Investment Research

Zacks Rank

Amcor currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performances of Other Packaging Stocks

Packaging Corporation of America (PKG Quick QuotePKG - Free Report) reported an adjusted EPS of $2.20 in the second quarter of 2024, beating the Zacks Consensus Estimate of $2.12. The reported figure was higher than the company’s guidance of $2.07 in the quarter under review. However, the bottom line decreased 5% year over year.

Sales in the second quarter grew 6.3% year over year to $2.08 billion. The top line beat the Zacks Consensus Estimate of $2.03 billion.

AptarGroup, Inc. (ATR Quick QuoteATR - Free Report) reported second-quarter 2024 adjusted earnings per share of $1.37, beating the Zacks Consensus Estimate of $1.36. The bottom line increased 12% year over year from $1.22 (including comparable exchange rates).

Total revenues increased 1.6% year over year to $910 million in the reported quarter. The reported figure missed the Zacks Consensus Estimate of $923 million. Core sales, excluding currency and acquisition effects, improved 3% year over year. The upside was driven by the solid performance in the Pharma segment. We expected core sales to be up 2.6% in the quarter.

Greif, Inc. (GEF Quick QuoteGEF - Free Report) reported adjusted earnings per share of 82 cents in second-quarter fiscal 2024 (ended Apr 30, 2024), which surpassed the Zacks Consensus Estimate of 77 cents. The bottom line fell 54% year over year. Results were impacted by elevated raw material, transportation and manufacturing costs, and higher SG&A expenses, reflecting increased compensation expenses and costs incurred for strategic investments.

Sales rose 4.1% year over year to $1.37 billion. The top line surpassed the Zacks Consensus Estimate of $1.31 billion.