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Amcor delivers 15pc boost to HY profit

Christian Edwards  |  12 Feb 2018Text size  Decrease  Increase  |  
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SYDNEY - [AAP] Global packaging company Amcor (ASX: AMC) has lifted its half-year net profit 15 per cent to $US329.7 million ($A461.6 million) thanks to expanded margins, strong returns and progress on key investments.

Revenue for the six months to December 31 has risen marginally, up 0.8 per cent to $US4.5 billion, from $US4.47 million in the prior corresponding period.

After-tax profit from ordinary activities before significant items was up 6.8 per cent, or 3.7 per cent in constant currency terms.

Chief executive Ron Delia says that despite industry headwinds, such as rising raw material costs and mixed conditions out of some emerging markets, the result is broadly in line with expectations.

Amcor now expects to take a hit of around $US25 million to its Flexibles segment's full-year pre-tax profits due to the rising cost of raw materials.

The company says it has already raised prices across the businesses in response, and more increases will come in the second half of the financial year.

Mr Delia says the company has reacted quickly to changing industry conditions, recovering higher input costs and adapting its cost base and production capacity where volumes have been weaker.

"Those actions helped underpin the first-half result and will continue to provide further support for earnings and margins as these short-term challenges continue into the second half," Mr Delia said.

Amcor said it expects the impact of the recently implemented US corporate tax cuts to be "broadly neutral," with the effective tax rate range likely to remain between 21 per cent and 23 per cent.

The company declared an unfranked interim dividend of US21 cents per share, up from 19.5 cents a year ago.

Shares in Amcor at 1150 AEDT, were 16 cents, or 1.1 per cent higher at $14.46.

AMCOR ON TRACK:

* Net profit up 15pc to $US329.7m

* Revenue up 0.8pc to $US4.5bn

* Interim dividend US21 cents, fully franked, up US1.5 cents

 

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