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Amcor H1 profit down as it eyes emerging markets

February 20, 2012 Comments Off

Amcor has reported that first-half profit fell 9.4% to $204.9m year-on-year and said it continues to pursue growth opportunities in emerging markets

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Net profit dropped to $204.9m in the six months to 31 December, down from $226.1m, the packaging giant said in a statement this morning (20 February).

However, Amcor said that profit before significant items increased 14% to $304.7m.

The high Australian dollar had a $16m negative impact on net profits, the company said.

The company said that the business continued to pursue and invest in growth opportunities in emerging markets. It said it was experiencing high growth for its Asian Flexibles operations.

It added: “This region is particularly attractive due to rising per capita income, increasing populations and introduction by our customers of new product categories”.

Elsewhere, it said that in its tobacco packaging operations agreement was reached to purchase a business in Argentina.

It said: “Amcor has a long history of successful operation in Latin America with a presence in 11 different countries.

“This is an exciting opportunity for the tobacco packaging business to leverage its technology expertise and manufacturing leadership into this market.”

‘Record underlying profit’

In announcing the result this morning, Amcor managing director and chief executive Ken MacKenzie said: “The first half result represented a record underlying profit, record returns and a record interim dividend for the company.

“These results are particularly pleasing given the backdrop of subdued economic conditions globally.”

‘Transformational acquisitions’

Amcor said that the transformational acquisitions it made in 2009 and 2010 had contributed to its record underlying profit.

It said: “The benefits from the Alcan Packaging acquisition have considerably exceeded expectations in terms of both quantum and timing.”

Group performance

Amcor said that its flexibles business had a strong half with earnings up 24%. It said that in Europe, underlying volumes were stable.

It also said that the rigid plastics business also had a strong half with earnings up 15%. It said that “this was achieved against a backdrop of a much cooler summer period which negatively impacted beverage sales during the summer months”.

In its outlook, Amcor explained: “The company is well positioned to continue to deliver improvements in underlying growth and overall earnings are expected to be well ahead of the same period last year.”

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