May 3, 2022 US May 4, 2022 Australia Ron Delia CEO Michael Casamento CFO Fiscal 2022 year to date results (nine months ended March 31, 2022) NYSE: AMCR | ASX: AMC
Disclaimers 2 Cautionary Statement Regarding Forward-Looking Statements This document contains certain statements that are “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally identified with words like “believe,” “expect,” “target,” “project,” “may,” “could,” “would,” “approximately,” “possible,” “will,” “should,” “intend,” “plan,” “anticipate,” “estimate,” “commit,” “potential,” “outlook,” or “continue,” the negative of these words, other terms of similar meaning or the use of future dates. Such statements are based on the current expectations of the management of Amcor and are qualified by the inherent risks and uncertainties surrounding future expectations generally. Actual results could differ materially from those currently anticipated due to a number of risks and uncertainties. None of Amcor or any of its respective directors, executive officers or advisors provide any representation, assurance or guarantee that the occurrence of the events expressed or implied in any forward-looking statements will actually occur. Risks and uncertainties that could cause actual results to differ from expectations include, but are not limited to: changes in consumer demand patterns and customer requirements; the loss of key customers, a reduction in production requirements of key customers; significant competition in the industries and regions in which Amcor operates; failure by Amcor to expand its business; failure to successfully integrate acquisitions; challenges to or the loss of Amcor’s intellectual property rights; adverse impacts from the ongoing COVID-19 pandemic; challenging future global economic conditions; impact of operating internationally, including negative impacts from the Russian invasion of Ukraine; price fluctuations or shortages in the availability of raw materials and other inputs; disruptions to production, supply and commercial risks; a failure in our information technology systems; an inability to attract and retain key personnel; costs and liabilities related to current and future environmental and health and safety laws and regulations; labor disputes; the possibility that the phase out of the London Interbank Offered Rate (“LIBOR”) causes the interest expense to increase; foreign exchange rate risk; an increase in interest rates; a significant increase in indebtedness; failure to hedge effectively against adverse fluctuations in interest rates and foreign exchange rates; significant write-down of goodwill and/or other intangible assets; need to maintain an effective system of internal control over financial reporting; inability of the Company’s insurance policies to provide adequate protections; litigation, including product liability claims; increasing scrutiny and changing expectations with respect to Amcor Environmental, Social and Governance policies resulting in increased costs; changing government regulations in environmental, health and safety matters; changes in tax laws or changes in our geographic mix of earnings; the Company’s ability to develop and successfully introduce new products; and other risks and uncertainties identified from time to time in Amcor’s filings with the U.S. Securities and Exchange Commission (the “SEC”), including without limitation, those described under Item 1A. “Risk Factors” of Amcor’s annual report on Form 10-K for the fiscal year ended June 30, 2021 and any subsequent quarterly reports on Form 10-Q. You can obtain copies of Amcor’s filings with the SEC for free at the SEC’s website (www.sec.gov). Forward-looking statements included herein are made only as of the date hereof and Amcor does not undertake any obligation to update any forward-looking statements, or any other information in this communication, as a result of new information, future developments or otherwise, or to correct any inaccuracies or omissions in them which become apparent, except as expressly required by law. All forward-looking statements in this communication are qualified in their entirety by this cautionary statement. Presentation of non-GAAP information Included in this release are measures of financial performance that are not calculated in accordance with U.S. GAAP. These measures include adjusted EBIT (calculated as earnings before interest and tax), adjusted net income, adjusted earnings per share, adjusted free cash flow and net debt. In arriving at these non-GAAP measures, we exclude items that either have a non-recurring impact on the income statement or which, in the judgment of our management, are items that, either as a result of their nature or size, could, were they not singled out, potentially cause investors to extrapolate future performance from an improper base. While not all inclusive, examples of these items include: • material restructuring programs, including associated costs such as employee severance, pension and related benefits, impairment of property and equipment and other assets, accelerated depreciation, termination payments for contracts and leases, contractual obligations, and any other qualifying costs related to the restructuring plan; • material sales and earnings from disposed or ceased operations and any associated profit or loss on sale of businesses or subsidiaries; • consummated and identifiable divestitures agreed to with certain regulatory agencies as a condition of approval for Amcor’s acquisition of Bemis; • impairments in goodwill and equity method investments; • material acquisition compensation and transaction costs such as due diligence expenses, professional and legal fees, and integration costs; • material purchase accounting adjustments for inventory; • amortization of acquired intangible assets from business combinations; • significant property impairments, net of insurance recovery; • payments or settlements related to legal claims; and • impacts from hyperinflation accounting. Amcor also evaluates performance on a comparable constant currency basis, which measures financial results assuming constant foreign currency exchange rates used for translation based on the average rates in effect for the comparable prior-year period. In order to compute comparable constant currency results, we multiply or divide, as appropriate, current-year U.S. dollar results by the current-year average foreign exchange rates and then multiply or divide, as appropriate, those amounts by the prior-year average foreign exchange rates. We then adjust for other items affecting comparability. While not all inclusive, examples of items affecting comparability include the difference between sales or earnings in the current period and the prior period related to acquired, disposed or ceased operations. Comparable constant currency net sales performance also excludes the impact from passing through movements in raw material costs. Management has used and uses these measures internally for planning, forecasting and evaluating the performance of the Company’s reporting segments and certain of the measures are used as a component of Amcor’s board of directors’ measurement of Amcor’s performance for incentive compensation purposes. Amcor believes that these non-GAAP measures are useful to enable investors to perform comparisons of current and historical performance of the Company. For each of these non-GAAP financial measures, a reconciliation to the most directly comparable U.S. GAAP financial measure has been provided herein. These non-GAAP financial measures should not be construed as an alternative to results determined in accordance with U.S. GAAP. The Company provides guidance on a non-GAAP basis as we are unable to predict with reasonable certainty the ultimate outcome and timing of certain significant forward-looking items without unreasonable effort. These items include but are not limited to the impact of foreign exchange translation, restructuring program costs, asset impairments, possible gains and losses on the sale of assets and certain tax related events. These items are uncertain, depend on various factors, and could have a material impact on U.S. GAAP earnings and cash flow measures for the guidance period.
Safety 3 Guided by our values. Committed to our goal of ‘no injuries’ 11.2 4.1 2.0 2.8 2.2 2.1 0.4 Recordable-case frequency rate (per million hours worked) 3Q22 OSHA Includes impact of acquired businesses 2021201520102005 2020 Notes: Recordable cases per 1,000,000 hours worked. All data shown for a 12 month period ended June 30 unless otherwise indicated. Acquired businesses (including Bemis) are included in 2020 and account for the increase in frequency rate compared with 2015 Amcor equivalent under OSHA (Occupational Safety & Health Administration) standard of incidents per 200,000 hours Amcor Values 3Q22
Key messages 4 1. Delivered strong March quarter across the business 2. Exceptional management of sales mix and inflation 3. Raised fiscal 2022 EPS guidance 4. Increasing investments for growth
56.2 cents YTD 20.4 cents 3Q $10,635M YTD • $973 million cash returns • $423 million share repurchases • Quarterly dividend increased to 12 cents per share • RoAFE increased to 16% Strong March quarter and year to date financial result 5 Notes: EBIT and EPS presented on an adjusted basis and growth rates exclude the impact of currency and items impacting comparability. Adjusted non-GAAP measures exclude items which are not considered representative of ongoing operations. RoAFE reflects Adjusted EBIT / Average funds employed (four quarter average). Further details related to non-GAAP measures and reconciliations to U.S. GAAP measures can be found in the appendix section. $3,708M 3Q Increasing year to date shareholder returns Strong result across all key metrics and EPS guidance raised +16% +13% Net sales $1,196M YTD $427M 3Q +9% +6% EBIT +11% EPS +15%
6 Growth in priority segments drives mix and margin benefits Notes: MSD is ‘Mid-Single Digit’. Large addressable markets (>$1bn each) Above average growth rates Common segment features: Protein Hot-Fill BeverageHealthcare Premium Coffee Pet Food Hot-Fill Beverage Total Amcor sales >$4 billion across priority segments MSD growth Mix improvement Margin expansion ealt care Premium Coffee Pet Food ot-Fill Beverage Higher margins Significant investment opportunities
Year to date highlights • Sales of $8.2bn includes price increases of ~$810 million (11% growth) related to higher raw material costs • Sales growth of 3% driven by proactive mix management. Net sales growth up 5% in 3Q • Favorable mix with MSD growth in healthcare, pet food and coffee. • Volumes constrained by raw material availability • Adjusted EBIT growth of 8%. 10% growth in 3Q • Growth in high value priority segments, strong cost performance and management of inflation Flexibles segment 7 Notes: Non-GAAP measures exclude items which are not considered representative of ongoing operations. Further details related to non-GAAP measures including Adjusted EBIT and reconciliations to U.S. GAAP measures can be found in the appendix. Comparable constant currency YTD Δ% for Net sales excludes an 11% impact from the pass through of raw material costs, a 1% unfavorable impact from items affecting comparability (disposed and ceased operations) and an unfavorable currency impact of 1%. MSD is ‘Mid-Single Digit’. Net sales growth of 5% in 3Q. Continued focus on managing mix and inflation YTD 3Q21 YTD 3Q22 Comparable constant currency Net sales ($m) 7,350 8,184 +3% Adjusted EBIT ($m) 1,005 1,069 +8% Adjusted EBIT margin 13.7% 13.1% March quarter net sales growth (comparable constant currency basis)
Rigid Packaging segment 8 Notes: Non-GAAP measures exclude items which are not considered representative of ongoing operations. Further details related to non-GAAP measures including Adjusted EBIT and reconciliations to U.S. GAAP measures can be found in the appendix. Comparable constant currency Δ% for Net sales excludes a 14% impact from the pass through of raw material costs. DD is ‘Double Digit’. Return to earnings growth in 3Q as expected Year to date highlights • Sales of $2.5bn includes price increases of ~$300 million (14% growth) related to higher raw material costs • Sales growth reflects continued elevated demand • North America beverage volumes up 2% • Hot fill volumes up 2% and 6% in 3Q reflecting continued growth in key categories • Latin America volumes up DD • 4% EBIT growth in 3Q in line with expectations • Improved performance expected to continue through the balance of the fiscal year YTD 3Q21 YTD 3Q22 Comparable constant currency Net sales ($m) 2,059 2,451 +5% Adjusted EBIT ($m) 209 194 (7)% Adjusted EBIT margin 10.1% 7.9% 8% -13% 4% FY21 1H22 3Q22 Return to EBIT growth as expected after NA industry wide supply chain challenges in 1H22
Cash flow, balance sheet & cash returns to shareholders 9 Notes: Non-GAAP measures exclude items which are not considered representative of ongoing operations. Further details related to non-GAAP measures including Adjusted EBITDA and Adjusted Free Cash Flow and reconciliations to U.S. GAAP measures can be found in the appendix section. (1) Adjusted Free Cash Flow excludes material transaction and integration related costs because these cash flows are not considered to be directly related to ongoing operations. (2) Leverage calculated as net debt divided by adjusted trailing twelve month EBITDA. Year to date cash flow ($ million) YTD 3Q21 YTD 3Q22 Adjusted EBITDA 1,455 1,507 Interest and tax payments (297) (235) Capital expenditure (329) (366) Movement in working capital (451) (647) Other (18) 4 Adjusted Free Cash Flow(1) 360 263 Balance sheet(2) March 2022 Net debt ($ million) 6,172 Leverage: Net debt / LTM EBITDA (x) 3.0x • Growing EBITDA • Working capital impacted by timing of raw material costs • Average working capital to sales remains below 8% • Increasing capital investment in strategic organic growth • Increasing cash returns to shareholders • $423 million of share repurchases to date. Total of $600 million expected in fiscal 2022 • Quarterly dividend increased to 12 cps Continued capacity to increase capex and cash returns to shareholders Year to date highlights
10 Note: Reconciliations of the fiscal 2022 projected non-GAAP measures are not included herein because the individual components are not known with certainty as individual financial statements for fiscal 2022 have not been completed. Fiscal 2022 guidance Amcor’s guidance contemplates a range of factors which create a higher degree of uncertainty and additional complexity when estimating future financial results. Refer to slide 2 for further information. Adjusted EPS growth of approximately 9.5 to 11% (previously 7 to 11%) on a comparable constant currency basis, or approximately 79.5 to 81.0 cents per share on a reported basis assuming current exchange rates prevail through fiscal 2022 Adjusted Free Cash Flow of approximately $1.1 billion Approximately $600 million of cash to be allocated towards share repurchases For the year ending 30 June 2022 the Company expects:
Investment case: Strong foundation for growth and value creation Global leader in primary consumer and healthcare packaging with a strong track record Consistent growth from priority segments, emerging markets and innovation Growing cash flow and strong balance sheet provides ongoing capacity to invest Increasing investment for growth and building momentum Compelling and growing dividend with current yield ~4% EPS growth + Dividend yield = 10-15% per year 11 Notes: A range of factors are contemplated when estimating future financial results. Refer to slide 2 for further information.
Multiple drivers of organic growth Priority Segments Emerging Markets >$3 bn Emerging Markets sales across 27 countries: Driving value through differentiated packaging: Innovation ProteinHealthcare Hot-fill beverage 12 MSD volume growth across Emerging Markets portfolio >$4 bn sales in higher growth, higher value segments: Notes: MSD is ‘Mid-Single Digit’. Premium Coffee Pet food More sustainable packaging To preserve food and healthcare products, protect consumers and promote brands
Growing demand for differentiated, sustainable product platforms Leveraging our global footprint to expand and localise capacity as demand grows up to 58% reduction in carbon footprint Future investment opportunity Wisconsin Investment underway pre-qualified in the U.S. up to 30% PCR content included 13
Increasing investments for organic growth 14 Capitalizing on high quality growth opportunities Brazil - Healthcare & Protein UK - Protein Ireland - Healthcare China – Food & Personal care Italy – AmLite Heatflex Increasing capex to 4-5% of sales
15 Sustainability: Partnering and investing for the future 15 Exxtend™ Net zero GHG emissions by 2050 Pathway aligned with Science Based Targets Increasing our ambitions Providing insights and expertise Creating demand for recycled material Collaborating with others for long-term impact
Key messages 16 1. Delivered strong March quarter across the business 2. Exceptional management of sales mix and inflation 3. Raised fiscal 2022 EPS guidance 4. Increasing investments for growth
Appendix slides Supplementary schedules and reconciliations
FX translation impact 18 EUR, 20-30% Other currencies(2), 20-30% USD, 45-55% EUR:USD Euro weakened vs USD, Average USD to EUR rate 3Q22 0.8713 vs 3Q21 0.8414 USD million impact on 3Q22 adjusted net income (4%) (7) Other currencies(2):USD Other currencies weighted average vs USD weakened for 3Q22 vs 3Q21 average rates USD million impact on 3Q22 adjusted net income (2%) (3) (1) Approximate range based on adjusted net income by currency. (2) Includes all currencies other than USD and EUR. Total currency impact $ million Adjusted EBIT (13) Adjusted net income (10) Combined net income currency exposures(1) Nine months ended March 31, 2022 currency impact
Reconciliations of non-GAAP financial measures 19
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