Global packaging manufacturer Amcor says it is starting to see a turnaround in recent tough conditions after reporting a 21 per cent jump in full-year net profit.
Amcor CEO Ron Delia said there are “early indications” in the new financial year that short-term challenges in the packaging industry had started to stabilise.
“Volumes in the North American beverage segment have modestly improved, earnings headwinds in some regions have started to slow as higher raw material costs are passed through and emerging markets organic growth improved in the second half to four per cent,” Mr Delia said in a statement.
Amcor’s net profit rose to $US724 million for the year ended June 30, with sales revenue up 2.4 per cent to $US9.32 billion.
In its rigid plastics division, which makes bottles for drinks and other plastic containers, Amcor’s sales revenue slipped to $US2.78 billion, down from $US2.88 billion in 2016/17.
The flexibles business, which makes plastic films and other flexible packaging for food and beverages, pharmaceuticals and consumer goods, recorded an increase in revenue to $US6.5 billion, up from $US6.2 billion in 2016/17.
Amcor commissioned new plants in India and Mexico during the year and in August signed a deal to acquire major US competitor Bemis to increase its presence in the US flexibles market.
Amcor will pay a final dividend of 24 US cents, up fractionally from 23.5 US cents a year earlier.
Looking ahead, Amcor said it expects solid growth in pre-tax profit for its flexibles segment in the current financial year, excluding any impact of the Bemis acquisition.
Amcor’s rigid plastics business is also expected to deliver solid underlying pre-tax profit growth, thanks to modest market organic growth and the impact of previous acquisitions.
Shares in the group were down 60.5 cents, or 4.2 per cent, to $13.675 at 1358 AEST.