Solid Amcor Ups Dividend
Get More Commentary, Discussion & Market Information On -
Global packaging company Amcor has played down the strength of its second half outlook after lifting first half-year net profit 15% to $US329.7 million ($A461.6 million).
The company attributed the improvement, expanded margins, strong returns and progress on some of its key investments.
Revenue for the six months to December 31 was up 0.8% to $US4.5 billion, from $US4.47 million in the prior corresponding period.
The company declared an unfranked interim dividend of 21 US cents per share, up from 19.5 cents a year ago.
CEO Ron Delia the result was in lines with expectations as the company had to deal with rising raw material costs (thanks to rising oil prices) and variable trading conditions in some emerging markets.
Those higher raw material costs will see Amcor take a hit of around $US25 million to its Flexibles segment’s full-year pre-tax profits.
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 tax cuts to be “broadly neutral,” with the effective tax rate range likely to remain between 21% and 23%
Shares in Amcor rose 0.5% to $14.38.
Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.
At the AFR he was a finance writer, Finance Editor, News Editor and Chief of Staff. At the Nine Network he was supervising producer of Business Sunday for more than 16 years. He has also written for other online and analogue print publications here and overseas.