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Amcor lifts full-year profit, dividend

Nicholas Grove  |  25 Aug 2016Text size  Decrease  Increase  |  

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Amcor's (ASX: AMC) underlying profit before one-off items for fiscal 2016 rose 7.5 per cent in constant currency to US$671.1 million, on the back of solid growth in both developed and emerging markets.

Statutory net profit, which included a previously announced accounting charge related to Amcor's Venezuelan business, was down 64.1 per cent to US$244.1 million.

Earnings per share (EPS) rose 11.3 per cent to 57.7 US cents on a constant currency basis, the global packaging company said in a statement to the ASX on Thursday.

Amcor declared an unfranked final dividend for 2016 of 22 US cents a share, which brought the annual dividend to 41 US cents a share, 1 US cent higher than the 2015 annual dividend.

The final dividend, which will be received as 28.6 Australian cents, will be paid on 29 September 2016 to shareholders on record as of 7 September 2016.

Amcor CEO Ron Delia said the results were evidence of the defensiveness and resilience of Amcor's businesses, with balanced growth across the portfolio.

"Growth was solid in both developed and emerging markets, there was a mix of growth from organic sources and from acquisitions and both the flexibles and rigid plastics segments achieved higher results than the same period last year," he said.

"Cash generation remained solid, the balance sheet is strong and returns exceeded 21 per cent for the first time.

"This enabled Amcor to redeploy US$1.2 billion of cash to generate value for shareholders through acquisitions, a share buyback and by increasing the dividend."

Delia said the Flexible Packaging segment division had a "solid" year with constant currency earnings growth of 7.2 per cent, while the Rigid Plastics business had an "outstanding" year with earnings up 9.7 per cent.

While not providing any specific earnings guidance, he said the outlook for fiscal 2017 is for "higher earnings" than fiscal 2016, expressed in constant currency terms.

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Nicholas Grove is a Morningstar journalist.

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