RUSSIA – American-Australian global packaging company, Amcor has announced plans to sell its three factories in Russia, with completion of sale expected to occur in H2 2023.
This announcement is in line with its statement in March regarding scaling down activities and exploring strategic options for its Russia operations.
Until completion of the sale, which is currently expected to occur in the second half of its 2023 fiscal year, Amcor remains committed to supporting its employees and customers, while preserving value for shareholders through an orderly sale process.
The guidance Amcor provided for FY23 in its recent year-end results takes into account a number of potential outcomes regarding the sale of Amcor’s factories in Russia.
Amcor is the latest company to join many Western companies to leave the country completely following Moscow’s invasion of Ukraine, which has complicated doing business there.
The company has been in the Russian market for 20 years and has been operating only three factories after it scaled down operations in March.
The continued conflict in Ukraine also saw the company closing its site in Kharkiv, Ukraine, to protect its local team as the armed conflict broke out. It has a dedicated crisis team that is continuing to monitor developments in real-time.
“We are deeply concerned about the humanitarian crisis in Ukraine and are actively contributing to the relief efforts,” said CEO Ron Delia in a message to Amcor’s global workforce.
“Amcor is committing at least US$1 million for direct support to our team in Kharkiv and their families and general humanitarian aid in partnership with the International Red Cross.”
The conflict has thrown the European packaging industry and the markets it serves into fresh uncertainty as businesses strive to bounce back from the COVID-19 pandemic.
Amcor share price slumps despite ‘outstanding year’ of earnings
Meanwhile, the company’s share price has dipped 1.9% to trade at US$18.41 despite the release of the company’s full-year earnings.
After opening 1.3% lower at US$18.52, stock in the S&P/ASX 200 Index (ASX: XJO) packaging company has continued to fall.
The packaging firm posted US$2.1 billion of adjusted EBITDA and seemingly optimistic guidance for the financial year 2023.
Over the last 12 months, the company reported US$14.5 billion of sales – a 13% increase on that of the prior corresponding period (pcp).
Earnings per share (EPS) reached 52.9 US cents – down 12% – while adjusted EPS came in 11% higher at 80.5 US cents
Adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) of US$2.1 billion – a 7% improvement.
The company also spent US$600 million to repurchase shares last financial year, reducing its issued shares by around 3%.
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