Intertape Polymer Group Inc. announced an agreement to acquire a majority stake in Capstone Polyweave Private Limited (d/b/a “Capstone”), a newly-formed enterprise in India, which is expected to lead to a greenfield investment by Capstone. The principal purpose of the Capstone partnership will be to provide IPG with a globally-competitive supply of certain woven products in order to better service and grow IPG’s woven products business. IPG will be partnering with the current shareholders of Capstone, who are also the shareholders and operators of Airtrax Polymers Private Limited (d/b/a “Airtrax”). Airtrax manufactures and sells woven products that are used in various applications, including in the building and construction industry. All amounts in this press release are denominated in US dollars unless otherwise indicated. Click Read More below for additional detail.
Highlights – underlying earnings unless otherwise indicated (1)(2) •Profit after tax (PAT) of USD 329.7 million up 3.7% on a constant currency basis;
•Earnings per share (EPS) of 28.5 US cents up 3.7% on a constant currency basis;
•Profit before interest and tax (PBIT) margin up 30 basis points to 11.4%;
•Strong returns, measured as profit before interest and tax to average funds employed of 19.7%;
•Operating cash flow, after net capital expenditure and cash significant items of USD 90.8 million(3); and
•Interim dividend per share increased 7.7% to 21.0 US cents.
Amcor’s CEO Mr Ron Delia said: “During the half year we have grown earnings, expanded margins and maintained strong returns, with good progress on key investments. Cash flow and the balance sheet remain strong which, along with our confidence in the earnings growth capacity of the business, enabled the Board to increase the interim dividend by 8% to 21.0 US cents per share.
“The first half result was in line with the expectations we outlined at our AGM, and demonstrated the resilience and agility of Amcor in the context of short-term industry challenges related to raw material cost increases, weak volumes in one Rigid Plastics segment and mixed conditions in emerging markets.
“The business has responded exceptionally well, focusing on the growth levers that are within our control, implementing pricing actions to recover higher input costs and adapting the cost base and production capacity where volumes have been weaker. Those actions helped underpin the first half result and will continue to provide further support for earnings and margins as these short-term challenges continue into the second half.
“Looking ahead, we expect another year of earnings growth in constant currency terms. We have continued to make progress against our strategic priorities with investments in the Alusa and Sonoco acquisitions and restructuring initiatives in the Flexibles segment, contributing more than USD 30 million to PBIT in the current half. Together these investments will deliver more than USD 100 million of PBIT growth across the three-year period ending FY2020, in addition to organic growth and further M&A.
“The long-term growth potential of Amcor remains substantial. We have a truly global business with a presence in more than 40 countries, unique market leading positions in attractive segments and a strong, differentiated value proposition for customers. This will enable continued strong cash generation, allowing us to take advantage of the significant growth opportunities, both organic and through acquisitions, across all Amcor’s businesses.”