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AP

Amcor plc (AMCR)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 revenue was $3.241B, roughly flat year over year; adjusted EBIT rose 5% and adjusted EPS increased 5% on a comparable constant currency basis, with margins expanding 40 bps to 11.2% .
  • Flexibles grew volumes ~3% and delivered adjusted EBIT up 4%; Rigid Packaging volumes rose ~1% with adjusted EBIT up 10% and margin up 70 bps to 7.3% .
  • FY25 guidance reaffirmed: adjusted EPS $0.72–$0.76, adjusted free cash flow $900–$1,000M; interest guidance trimmed to $290–$300M; ETR 19–20%; leverage expected at or below 3.0x by year-end .
  • Catalysts: merger with Berry progressing (shareholder meetings Feb 25; $650M identified synergies; $3B+ annual cash flow potential), dividend raised to $0.1275 per share, and health care destocking largely behind; all support a constructive near-term setup .

What Went Well and What Went Wrong

What Went Well

  • Volume momentum: 2.3% total volume growth with fourth consecutive sequential improvement; “return to sales growth… margins continue to improve… 5% increase in adjusted EBIT and EPS” (CEO) .
  • Margin expansion: company adjusted EBIT margin +40 bps YoY to 11.2%; Flexibles margin +20 bps to 12.8%; Rigid margin +70 bps to 7.3% on cost actions and productivity .
  • Cash generation and deleveraging: Q2 adjusted FCF of $358M; net debt down ~$375M vs Q1; leverage 3.3x with path to ≤3.0x by year-end (CFO) .

What Went Wrong

  • Price/mix headwinds: approximately -2% impact at the company level, primarily from lower volumes in high-value health care categories .
  • North America beverage remains soft: mid-single-digit declines in beverage volumes; management characterizes consumer demand as “soft and variable,” though sequentially improved vs Q1 .
  • Adjusted free cash flow was an outflow of $38M in 1H (seasonal and working capital-related), versus a $52M inflow last year; working capital movement was -$433M year to date .

Financial Results

Consolidated performance vs prior periods and estimates

MetricQ2 2024Q1 2025Q2 2025Consensus (Q2 2025)
Revenue ($USD Millions)$3,251 $3,353 (derived from H1 $6,594 and Q2 $3,241) $3,241 N/A (S&P Global consensus unavailable)
GAAP Diluted EPS (US cents)9.2 13.1 (derived from H1 24.4 and Q2 11.3) 11.3 N/A (S&P Global consensus unavailable)
Adjusted EPS (US cents)15.7 16.2 16.1 N/A (S&P Global consensus unavailable)
Adjusted EBIT ($USD Millions)352 365 (derived from H1 728 and Q2 363) 363 N/A (S&P Global consensus unavailable)
Adjusted EBIT Margin (%)10.8% 10.9% 11.2% N/A (S&P Global consensus unavailable)

Note: Consensus estimates from S&P Global were unavailable at time of writing due to data access limits.

Segment breakdown (Q2 2025 vs Q2 2024)

SegmentQ2 2024 Net Sales ($M)Q2 2025 Net Sales ($M)Q2 2024 Adjusted EBIT ($M)Q2 2025 Adjusted EBIT ($M)Q2 2024 Adjusted EBIT MarginQ2 2025 Adjusted EBIT Margin
Flexibles$2,481 $2,511 $312 $322 12.6% 12.8%
Rigid Packaging$770 $730 $51 $53 6.6% 7.3%

KPIs and drivers (Q2 2025)

KPICompanyFlexiblesRigid Packaging
Volume Growth YoY (%)+2.3% ~+3% ~+1%
Price/Mix Impact YoY (%)~-2% ~-2% ~-2%
FX Impact YoY (%)~-1% ~-1% ~-2%
Raw Material Pass-Through Impact+1% total ($20M); Rigid -2% ($15M)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted EPSFY25$0.72–$0.76 $0.72–$0.76 Maintained
Adjusted Free Cash FlowFY25$900–$1,000M $900–$1,000M Maintained
Net Interest ExpenseFY25$290–$305M $290–$300M Lowered
Effective Tax RateFY2519%–20% 19%–20% Maintained
Leverage Target (Net Debt/EBITDA)FY25 Exit≤3.0x ≤3.0x Maintained
Dividend per Share (Quarterly)Current$0.1275 (Board increased) $0.1275 declared; $0.1275 vs $0.1250 prior-year quarter Increased vs PY

Earnings Call Themes & Trends

TopicQ1 2025 (Oct)Q2 2025 (Feb)Trend
Health care destockingPharma down low double digits; medical modest growth; expected to abate by end of calendar 2024 Destocking “largely behind”; mix to improve; health care expected to return to growth Improving
North America beverageHigh single-digit declines; consumer muted; temporary plant closures due to hurricane Soft/variable; mid-single-digit declines; improved ~4ppt vs Q1 Gradual improvement
Merger synergies & integrationStrategic focus on organic growth, portfolio, innovation; JV Bericap sale announced $650M synergies; 40% year-1 realization; $3B+ annual cash flow; shareholder meetings Feb 25; initial approvals received Accelerating
Sustainability & innovationElevated CSO role; AmFiber/AmPrima; innovation centers; fiber recyclability New AmFiber Performance Paper launch (80% recycled content); combined R&D $180M Advancing
Supply chain/tariffs/macroBuilt raw material inventories; supply chain tremors; leverage impact Raw materials benign; tariffs limited due to regional nature; pass-through mechanisms Stable/benign
Cash flow/leverageFCF guidance $900–$1,000M; leverage higher in Q1 but path to 3x Q2 adjusted FCF $358M; net debt down ~$375M; leverage 3.3x; exit ≤3.0x reaffirmed Improving

Management Commentary

  • “Q2 results were in line with expectations… fourth consecutive quarter of sequential volume improvement… 5% increase in both adjusted EBIT and EPS on a comparable basis” (CEO) .
  • “We remain on track to deliver for the full year… interest guidance lowered… expect leverage at 3x or lower by year-end” (CFO) .
  • “Bringing [Amcor and Berry] together… $650 million of identified synergies… $3+ billion annual cash flow… middle of calendar 2025 closing on track” (CEO) .
  • “Health care destocking is now largely behind us… expect health care will overall return back to growth” (CEO) .

Q&A Highlights

  • Portfolio pruning under combined Amcor-Berry to orient toward higher growth and margin quality; synergy confidence reiterated, especially ~$325M procurement within ~$13B combined spend (~3% capture) .
  • Inputs/tariffs: raw materials broadly flat in 1H; Q3 outlook benign; tariffs limited impact given regional operations and pass-through mechanisms .
  • Health care trajectory: medical strengthened; pharma destocking abating; overall health care to return to growth in back half, improving mix .
  • Rigid Packaging outlook: profitability improving via cost actions; beverage demand still discretionary; combined entity brings scaled containers/closures exposure outside NA beverage, including dispensing systems .

Estimates Context

  • S&P Global consensus for Q2 2025 (EPS, revenue, EBITDA, target price) was unavailable at time of writing due to data access limits. Values retrieved from S&P Global would normally be presented here; absence limits beat/miss quantification.
  • Directionally, adjusted EPS and EBIT grew 5% YoY with margin expansion, and interest guidance was lowered, suggesting modest upward bias to FY EPS trajectories, while revenue was flat and beverage softness persists .

Key Takeaways for Investors

  • Margin expansion with volume recovery continues; Flexibles is leading while Rigid shows improving profitability despite soft beverage demand—supportive for near-term EPS delivery and FY guidance reaffirmation .
  • Health care destocking largely behind; as mix normalizes, expect improved price/mix and margin quality in 2H—potential positive revision driver .
  • Cash generation inflecting: Q2 adjusted FCF $358M; deleveraging underway toward ≤3.0x—creates optionality and reduces risk into merger close .
  • Berry combination is a central catalyst: $650M synergies, scaled containers/closures, $3B+ annual cash flow potential; process milestones achieved, keeping mid-2025 close on track .
  • Dividend growth maintained ($0.1275 quarterly) and guidance stable—income support with operational progress .
  • Watch Q3/Q4: health care mix improvement, beverage demand trends, and interest expense tailwind from Bericap proceeds; monitor regulatory approvals and integration readiness .
  • Near-term trading: reaffirmed guidance, margin expansion, and merger momentum are constructive; any updates on synergy realization pace or health care growth resumption likely stock-moving .

Sources

  • Q2 2025 8-K and EX-99.1/99.2 (press release and investor presentation) .
  • Q2 2025 earnings call transcript .
  • Q1 2025 earnings call transcript (prior quarter trend) .
  • Press release on transaction milestones (Jan 23, 2025) .