Amcor rallied strongly in the US, up as much as 8.9%, after delivering a third-quarter result that was broadly in line for earnings, but the top line (revenue) was better, while importantly, its downgraded full-year guidance was not as bad as the market had feared.
3Q Highlights
- Adjusted EPS came in at US96c, slightly ahead of consensus expectations for US95c.
- Net sales were US$5.91bn, up 77% YoY and ahead of expectations for US$5.71bn
- Full-year adjusted EPS guidance was trimmed to US$3.98–US$4.03, down from US$4.00–US$4.15 previously, but ahead of consensus at $US3.97
The packaging sector has been under pressure through the Middle East conflict, with higher energy, freight and raw material costs weighing on margins and sentiment, however Amcor’s message was more measured. Management acknowledged input cost inflation is running well above normal levels, but also highlighted the company’s ability to recover costs through contractual pass-through mechanisms.
- A reassuring update from AMC overnight, and shares should do well on the ASX today.
MM is long & bullish AMC ~$53
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