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AP

Amcor plc (AMCR)·Q1 2026 Earnings Summary

Executive Summary

  • Q1 2026 delivered solid integration-driven results: net sales $5.745B, adjusted EBIT $687M, adjusted EPS $0.193; reaffirmed FY26 guidance for adjusted EPS $0.80–$0.83 and FCF $1.8–$1.9B .
  • EPS beat consensus (0.193 vs 0.184), while revenue was slightly below (actual $5.745B vs $5.761B); beat driven by $38M synergies, disciplined cost and productivity; revenue softness tied to ~2% lower combined volumes and unfavorable price/mix in certain categories .
  • Margins expanded: adjusted EBIT margin 12.0% (+110 bps YoY), with both Flexible and Rigid segments improving; Rigid margin +420 bps YoY reflecting quality of combined business .
  • Dividend raised to $0.13; management reiterated confidence in at least $260M FY26 synergies and $650M through FY28; portfolio optimization progressing (two small asset sale agreements, NA beverage designated non-core) .
  • Catalysts: guidance reaffirmation, visible synergy momentum, margin expansion across segments, and increased dividend support a positive narrative despite volume headwinds .

What Went Well and What Went Wrong

What Went Well

  • Synergies at upper end of range: ~$38M in Q1 (≈$33M to EBIT and ~$5M to interest), underpinning EPS beat and margin expansion .
  • Segment margin gains: Flexible adjusted EBIT margin 13.1% (+20 bps YoY) and Rigid 11.9% (+420 bps YoY), reflecting improved cost performance and acquisition benefits .
  • Confident outlook reaffirmed: FY26 adjusted EPS $0.80–$0.83 and FCF $1.8–$1.9B; capex $850–$900M, net interest $570–$600M, ETR 19–21% .
  • Management quote: “Adjusted EPS of 19.3 cents per share was above the mid-point of our guidance... supported by disciplined cost performance, improved productivity and delivery of synergies...” — CEO Peter Konieczny .

What Went Wrong

  • Volumes: combined Q1 volumes ~2% below prior year (ex. non-core NA beverage); Flexible volumes down ~2.8% and Rigid down ~1% (ex. NA beverage) .
  • Price/mix headwinds: Rigid experienced unfavorable price/mix and pass-through of lower raw materials (~-6%), weighing on net sales despite acquired growth .
  • NA beverage still a drag: volumes high-single-digit declines last quarter and operational issues persisted into Q4 FY25, with elevated costs expected in Q1; strategic alternatives remain under evaluation .

Financial Results

Quarter-over-Quarter

MetricQ4 2025Q1 2026
Net Sales ($USD Millions)$5,082 $5,745
Adjusted EBIT ($USD Millions)$611 $687
Adjusted EBIT Margin (%)12.0% 12.0%
Adjusted EPS (US cents)20.0 19.3
Free Cash Flow ($USD Millions)$943 $(343)

Year-over-Year (Q1)

MetricQ1 2025Q1 2026
Net Sales ($USD Millions)$3,353 $5,745
Adjusted EBIT ($USD Millions)$365 $687
Adjusted EBIT Margin (%)10.9% 12.0%
Adjusted EPS (US cents)16.2 19.3
Free Cash Flow ($USD Millions)$(395) $(343)

Versus Wall Street Estimates (Q1 2026)

MetricConsensusActualSurprise
Primary EPS ($USD)0.184*0.193*Bold beat (≈$0.009)*
Revenue ($USD Billions)$5.761*$5.745*Slight miss (≈$0.016B)*

Values with asterisk retrieved from S&P Global.

Segment Breakdown (Q1 2026)

SegmentNet Sales ($USD Millions)Adjusted EBIT ($USD Millions)Adjusted EBIT Margin (%)
Global Flexible Packaging Solutions$3,257 $426 13.1
Global Rigid Packaging Solutions$2,488 $295 11.9
Other (Corporate)— $(34) —

KPIs (Q1 2026)

KPIQ1 2026
GAAP Net Income ($USD Millions)$262
GAAP Diluted EPS (US cents)11.3
Adjusted EBITDA ($USD Millions)$909
Adjusted Net Interest Expense ($USD Millions)$140
Adjusted Tax Expense ($USD Millions)$99 (ETR 18.0%)
Capex ($USD Millions)$238
Free Cash Flow ($USD Millions)$(343)
Net Debt ($USD Millions)$13,999

Drivers: acquired sales ($2.4B net of divestments), synergies ($33M to EBIT), disciplined cost, improved productivity; headwinds included lower volumes and unfavorable price/mix in Rigid .

Guidance Changes

MetricPeriodPrevious Guidance (Aug 14, 2025)Current Guidance (Nov 5, 2025)Change
Adjusted EPSFY 2026$0.80–$0.83 $0.80–$0.83 Maintained
Free Cash FlowFY 2026$1.8–$1.9B $1.8–$1.9B Maintained
CapexFY 2026$850–$900M $850–$900M Maintained
Net Interest ExpenseFY 2026$570–$600M $570–$600M Maintained
Effective Tax RateFY 202619–21% 19–21% Maintained
Dividend (Quarterly)Q1 2026$0.1275 $0.1300 Raised

Management also noted FY26 phasing: H2 weighted (≈55% of EPS in H2), with synergy run-rate building through the year .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2025)Previous Mentions (Q4 2025)Current Period (Q1 2026)Trend
SynergiesIdentified $650M; $260M in FY26; procurement/G&A first, ops later Early integration; $260M FY26, $650M total; H2 acceleration $38M in Q1; confidence in ≥$260M FY26, $650M by FY28 Building momentum
Supply Chain/OperationsInventory/working capital focus; macro/tariff uncertainty NA beverage operational issues; cost elevation; fix underway Issues “under control”; sequential profit improvement; exploring JV/partnership Improving execution
Tariffs/MacroMacro uncertainty and tariffs weighed on demand FY26 outlook prudently assumes subdued demand Guidance not dependent on macro improvements Neutral-to-cautious
Product PerformanceHealthcare improved; protein, liquids growth; snacks/confectionery weaker Healthcare/foodservice steady; beauty/wellness softer Petcare strong; dairy up; beauty/wellness down; unconverted film weakness in Europe Mixed; focus categories outperform
Regional TrendsNA weakness; Europe/APAC/LatAm modest growth NA beverage weaker; LatAm/EU stable NA excluding beverage in line; EU marginally lower; LatAm low-single-digit declines NA stabilizing ex beverage
Portfolio OptimizationAnnounced review; core vs non-core identification ~$2.5B non-core (incl. ~$1.5B NA beverage) Two small asset sales (~$100M proceeds); NA beverage non-core, exploring options Executing

Management Commentary

  • “We have clear line of sight to delivering at least $260 million of synergy benefits in fiscal 26, and... $650 million... by fiscal 28; synergies alone to drive more than 30% EPS growth” — CEO Peter Konieczny .
  • “Adjusted EPS of $0.193 per share was above the midpoint... supported by disciplined cost performance, improved productivity and delivery of synergies...” — CEO Peter Konieczny .
  • “Leverage exiting the quarter was 3.6x... on track to reach 3.1–3.2x by fiscal year-end” — CFO Michael Casamento .
  • “We increased our quarterly dividend... $0.13 per share... reaffirmed FY26 EPS and FCF guidance” — CEO Peter Konieczny .

Q&A Highlights

  • Flexibles demand softness centered in Europe’s unconverted film; overall Q1 volumes down ~2% ex non-core NA beverage, as expected .
  • NA beverage: operational issues addressed and “under control”; sequential profitability improved; strategic alternatives (JV/partnerships) progressing .
  • Synergies detail: $38M in Q1, ~$33M EBIT and ~$5M interest; ~2/3 G&A and ~1/3 procurement; run-rate to build through Q2/Q3 .
  • Focus categories outperformed (petcare, dairy); beauty & wellness down low-single digits; healthcare flat overall with strength in NA medical .
  • Private label: underrepresented; targeted growth to participate in value-seeking consumer trend .

Estimates Context

  • Q1 2026 EPS beat: actual 0.193 vs consensus 0.184; revenue slight miss: actual $5.745B vs consensus $5.761B; 11 estimates for each metric*.
  • Implications: modest upward bias to FY26 EPS models given synergy momentum and margin expansion; revenue trajectories likely tempered by continued volume headwinds and price/mix pressure in Rigid*.

Values retrieved from S&P Global.

Key Takeaways for Investors

  • Integration synergy cadence is tracking ahead, driving EPS beats and multi-segment margin expansion; maintain overweight on synergy realization into H2 .
  • Reaffirmed FY26 EPS and FCF guidance, with results not reliant on macro improvement; risk-adjusted confidence rooted in controllable self-help .
  • NA beverage is ring-fenced as non-core and operational issues are stabilizing; potential strategic action could unlock value and aid deleveraging .
  • Flexible/rigid portfolio shows resilience in focus categories (petcare, dairy, healthcare) amid consumer value-seeking; position for mix benefits .
  • Dividend increase signals cash flow confidence; leverage path toward ~3.1–3.2x by FY-end supports capital return optionality .
  • Near-term trading: expect narrative support from synergy updates and segment margin prints; monitor EU flexibles film and rigid price/mix headwinds .
  • Medium-term thesis: $650M synergies by FY28, portfolio optimization, and cross-selling across expanded formats/materials underpin >30% EPS growth from synergies alone .