Revenue Performance: Amcor reported Q3 revenue of $3.41 billion, a decrease of 6% YoY largely influenced by a 4% decline in volumes amidst ongoing destocking effects in healthcare and North American beverage businesses. However, this marked an improvement from previous quarters, reflecting a recovery as destocking abated.
Profitability: Gross profit margins were recorded at 20.2%, slightly improved from the previous quarter, with net income for Q3 hitting $187 million, denoting a year-over-year increase of 5.7%. The adjusted EPS was reported at $0.130, growing by 8.3% YoY and 40.7% QoQ, highlighting effective cost management amidst lower sales volumes.
Operational Efficiency: Amcor achieved $130 million in cost savings, including $15 million from structural initiatives. Operational improvements contributed to a remarkable increase in earnings leverage, signaling effective inventory and cost management strategies.
Balance Sheet Strength: Amcor’s total assets stood at $16.66 billion, with total liabilities of $12.65 billion resulting in a healthy equity position of $3.94 billion. The current ratio is 1.285, indicating sufficient liquidity to manage short-term obligations. Net debt remains manageable at $6.73 billion with a debt-to-equity ratio of 1.822, suggesting leverage is reasonably controlled given the margin pressures in the business.
Cash Flow Metrics: Amcor delivered a free cash flow of $37 million and reaffirmed its full-year guidance of $850 million to $950 million in free cash flow, reflecting strong working capital management and ongoing efforts to control expenditures.