Ramoun Lazar

Ramoun Lazar inquired about how Amcor's customers are performing in the overall market context, specifically if customers who previously experienced market share losses have now stabilized their share.

Answer

CEO Peter Konieczny stated that Amcor's broad customer exposure generally aligns its performance with the market. He observed that customer conversations are shifting towards balancing price and volumes, with increased promotional activities. Amcor is well-positioned to support customers in these efforts but is planning the second half consistently with the first half's market conditions.

Ramoun Lazar from Jefferies asked for comments on how Amcor's customers are performing in the overall market context, specifically if customers who previously experienced market share losses have now stabilized their positions.

Answer

CEO Peter Konieczny stated that Amcor's broad exposure to diverse customer groups means its performance generally reflects the market. He observed that large CPG customers, who previously prioritized price over volume in an inflationary environment, are now seeking a better balance between price and volume, leading to increased promotional activities. Amcor is well-positioned to support these shifts, though its planning for the second half remains consistent with the first half's performance.

Ramoun Lazar requested an update on the North American beverage business, noting a high single-digit volume decline for the quarter, and asked about progress on turning the business around and any potential investments or divestments.

Answer

CEO Peter Konieczny (PK) reported good progress on the operational side, with previously identified issues now under control and sequential profitability improvement despite softer volumes. He confirmed that Amcor is actively exploring strategic alternatives for this non-core business, including joint ventures or partnerships.

Ramoun Lazar inquired about the North American beverage business, including the high single-digit volume decline, progress on operational turnaround, and updates on potential investments or divestments of the business.

Answer

Peter Konieczny, CEO of Amcor, reported significant operational progress, with prior challenges now under control. He noted that despite sequential volume softening, profitability increased. He also confirmed active exploration of strategic alternatives, including joint ventures or partnerships, for this non-core business.

Ramoun Lazar asked for more detail on the operational issues within the North American Rigid Beverages business and requested a quantification of the financial impact.

Answer

CEO Peter Konieczny explained that the business cut costs too aggressively ahead of its seasonal peak, leading to service issues, higher freight, and increased labor costs. CFO Michael Casamento quantified the impact, noting the North American Beverage business EBIT was down approximately $20 million year-over-year, primarily due to these operational challenges.