First-half earnings dipped at Melbourne-based packaging solutions firm Orora as the company yesterday warned of challenging market conditions.
The company reported an interim net profit after tax of $76.6 million, down 13.3% on the first half of 2018-19.
That was despite a 13.3% jump in revenues to $1.8352 billion for the six months to December.
Earnings Before Interest and Tax (EBIT) declined 4.1% to $133.1million.
Despite the weaker result, the company left its interim dividend unchanged at 6.5 cents a share.
That wasn’t good enough for investors and the shares fell 4% to $3.01.
Not helping was the weak outlook for the rest of the year.
“Orora expects challenging market conditions to persist for the remainder of FY20… [and] are expected to result in reported operating EBIT for the continuing operations being lower in FY20.”
The company also announced that Rob Sindel, former managing director and CEO of CSR, would replace Chris Roberts as its chairman.
Directors also confirmed that the company still plans to return $1.2 billion to shareholders from the $1.7 billion sale of its Fibre packaging operations.
They said the company is still talking to the Australian Tax Office, but “options include a cash return, comprising part capital return and a partially franked special dividend, and an on-market share buyback.”
No timing was given and directors said shareholders would be advised in “due course” on the course of action.