Half Year 2024 Orora Ltd Earnings Call Transcript
Key Points
- Orora Ltd (ASX:ORA) reported an 11% increase in underlying EBIT to $184.1 million, demonstrating strong financial performance.
- The acquisition of Saverglass is expected to enhance Orora's market position and align with its strategic growth priorities.
- Cash generation remains robust with underlying operating cash flow of $240.5 million and a cash conversion rate of 92.7%, excluding Saverglass and the G3 rebuild.
- The North American business achieved EBIT and margin growth despite challenging market conditions, reflecting effective cost management and operational efficiency.
- The Australasian beverage business showed resilience with earnings growth driven by strong demand for cans and successful commissioning of a new cans line in Dandenong.
- Revenue in North America declined by 15.9% on a constant currency basis, impacted by lower volumes and price deflation.
- The Australasian beverage glass segment faced ongoing softness in demand for Australian commercial wine and beer bottles, leading to lower glass volumes.
- Net financing costs increased by $11.4 million due to higher debt levels and base interest rates, impacting overall profitability.
- The acquisition of Saverglass incurred significant transaction costs of $40 million, with total transaction costs amounting to $75 million in the half.
- Global market conditions remain challenging with persistent inflationary pressures and uncertain consumer demand, potentially affecting future performance.
Thank you for standing by, and welcome to the Orora Limited FY24 half year results investor call. (Operator Instructions)
I would now like to hand the conference over to Mr. Brian Lowe, Managing Director and Chief Executive Officer. Please go ahead.
Good morning, and thank you for joining us today for the Orora Group first half FY24 results presentation. I'm joined by Shaun Hughes, our Chief Financial Officer.
Today, I am pleased to provide you with an overview of our results for the first half of FY24 and an update on our safety performance. And in light of the Saverglass acquisition, I'll also revisit Orora's compelling investment proposition as a design-led leading sustainable packaging solutions provider and set out how Saverglass is aligned to that investment proposition and the continued progress we've made against our strategic priorities.
I'll then hand you over to Shaun, who will take you through the group and business unit financials in more detail
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