Amcor(AMCR) - 2025 Q3 - Quarterly Results

Financial Performance - Amcor reported net sales of $9,927 million for the nine months ended March 31, 2025, a decrease of 2$900-1,000 million[1]. - Adjusted EBIT for the nine months ended March 31, 2025, was $1,112 million, reflecting a 3$7,667 million, up 1% compared to the previous year, with an adjusted EBIT margin of 13.1%[21]. - The Rigid Packaging segment experienced a 10% decline in net sales to $728 million, primarily due to the divestment of the Bericap Joint Venture[28]. - Net sales for the nine months ended March 31, 2025, were$9,927 million, an 8% decrease compared to $10,105 million in the prior year, with a 2$171 million, approximately 1% lower than last year, with an adjusted EBIT margin of 7.6%, which is 10 basis points higher than the previous year[35]. - Adjusted free cash outflow for the nine months ended March 31, 2025, was $17 million, a significant decline from an inflow of$115 million in the prior year, primarily due to higher inventories[39]. - The company reported a net income of $557 million for the nine months ended March 31, 2025, compared to$479 million in the prior year[52]. - For the three months ended March 31, 2025, adjusted EBITDA was $477 million, a decrease of 4$550 million, up from $473 million in the same period last year, representing a growth of 16.3$20 million for the three months ended March 31, 2025, down from $63 million in the same period last year[56]. - Adjusted EBIT for the three months ended March 31, 2025, was$384 million, a decrease of 3% from $397 million in the same period last year[61]. - The adjusted EBIT margin for the three months ended March 31, 2025, was 11.5$650 million in identified synergies over three years, with $260 million of pre-tax synergies anticipated in fiscal 2026[2]. - The company is positioned for faster integration with Berry Global following the merger closure, enhancing its customer offerings and innovation capabilities[2]. - Amcor completed the merger with Berry Global Group, Inc. on April 30, 2025, which is expected to enhance operational synergies[67]. - Risks associated with the merger include integration challenges, unexpected costs, and potential litigation, which could adversely affect business operations[67]. Cash Flow and Debt - Cash and cash equivalents increased to$2,045 million as of March 31, 2025, up from $457 million at the beginning of the year[53]. - Net debt as of March 31, 2025, was$6,752 million, with leverage at 3.5 times adjusted trailing twelve-month EBITDA, expected to decrease to approximately 3.4 times by June 30, 2025[40]. - Net debt increased from $6,111 million as of June 30, 2024, to$6,752 million as of March 31, 2025[66]. Market and Economic Conditions - North America beverage comparable constant currency net sales and volumes declined in the high single-digit range, while Latin America saw mid-single-digit growth due to favorable price/mix benefits[34]. - Management has indicated that rising interest rates could increase borrowing costs and negatively impact financial condition[68]. - The company faces significant competition and changing consumer demand patterns, which may affect its ability to expand effectively[67]. - The company is exposed to various risks including cybersecurity threats, climate change impacts, and regulatory changes that could affect operations[68]. Tax and Regulatory - For the nine months ended March 31, 2025, GAAP income tax expense was $141 million, compared to$107 million in the prior year, with an effective tax rate of 17.8%[38]. - The company emphasizes the importance of non-GAAP measures such as adjusted EBITDA and adjusted net income for evaluating performance, excluding non-recurring items[69]. - Amcor's guidance is provided on a non-GAAP basis due to uncertainties in predicting certain significant forward-looking items[71]. - The company has received a waiver from ASX's settlement operating rules, allowing deferral of processing conversions between its ordinary share and CDI registers from May 21, 2025, to May 22, 2025[72]. Inflation and Restructuring - The impact of highly inflationary accounting for the nine months ended March 31, 2025, was $8 million, compared to$55 million in the same period last year[58]. - The company incurred restructuring and related expenses of $35 million for the nine months ended March 31, 2025, down from$82 million in the same period last year[58].