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Amcor's (AMCR) Q1 Earnings Match Estimates, Revenues Beat

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Amcor Plc (AMCR - Free Report) reported first-quarter fiscal 2022 (ended Sep 30, 2021) adjusted earnings per share of 18 cents, which came in line with the Zacks Consensus Estimate. The bottom line improved 13% year over year from 16 cents reported in the prior-year quarter.

Including special items, the company reported net earnings per share of 13 cents, up 4% from the prior-year quarter.

Total revenues improved 10% year over year to $3,420 million in the reported quarter and beat the Zacks Consensus Estimate of $3,276 million. Price increase contributed 9% to the improvement, while volumes were in line with the prior-year quarter.

Amcor PLC Price, Consensus and EPS Surprise Amcor PLC Price, Consensus and EPS Surprise

Amcor PLC price-consensus-eps-surprise-chart | Amcor PLC Quote

Cost and Margins

Cost of sales increased 13% year over year to $2,770 million. Gross profit dipped 1% year over year to $650 million. Gross margin was 19%, reflecting a contraction of 210 basis points from the prior-year quarter.

SG&A expenses decreased 5% to $313 million year over year. Adjusted operating income was $381 million in the quarter, up 7% from the $358 million in the prior-year quarter. Adjusted operating margin was 11.1% compared with 11.6% in the prior-year quarter. Adjusted EBITDA in the quarter was $486 million compared with $460 million in the prior-year quarter.

Segment Performance

Flexibles: Net sales increased 10% year over year to $2,634 million. Adjusted operating income climbed 9% year over year to $339 million.

Rigid Packaging: The segment reported net sales of $786 million in the reported quarter, up 13% from the prior-year quarter. Adjusted operating income was down 14% year over year to $62 million.

Financial Updates

As of Sep 30, 2021, Amcor had $633 million of cash and cash equivalents compared with $757 million as of Sep 30, 2020. The company utilized $112 million of cash in operating activities in first-quarter fiscal 2022 compared with an outflow of $110 million in the prior-year quarter. Adjusted free cash flow was an outflow of $242 million in the reported quarter compared with usage of $190 million in the prior-year quarter. As of Sep 30, 2021, Amcor’s net debt totaled $5.95 billion, up from $5.4 billion as of Jun 30, 2021.

The company hiked quarterly dividend by 2% to 12 cents per share. Amcor repurchased 5.2 million shares for $64 million in the quarter. It plans to spend $400 million for share repurchases in fiscal 2022.

Fiscal 2022 Guidance Affirmed

Amcor expects adjusted constant currency earnings per share growth of approximately 7-11% in fiscal 2022 or approximately in the range of 79 cents to 81 cents. The company projects adjusted free cash flow between $1.1 billion and $1.2 billion in fiscal 2022.

Share Price Performance

Zacks Investment ResearchImage Source: Zacks Investment Research

Over the past year, Amcor’s shares have gained 8.9%, compared with the industry’s growth of 22.2%.

Zacks Rank & Stocks to Consider

Amcor currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the Industrial Products sector include The Manitowoc Company, Inc. (MTW - Free Report) , Encore Wire Corporation (WIRE - Free Report) and Heritage-Crystal Clean, Inc. (HCCI - Free Report) . All of these stocks sport a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Manitowoc has an anticipated earnings growth rate of 340% for fiscal 2021. The company’s shares have soared around 169% in a year.

Encore Wire has an estimated earnings growth rate of 491% for the ongoing fiscal year. The company’s shares have appreciated 194% in the past year.

Heritage-Crystal Clean has a projected earnings growth rate of 553% for the current year. The stock has appreciated around 104% in a year’s time.