Avery Dennison Announces Third Quarter 2022 Results

Avery Dennison Corporation (NYSE:AVY) today announced preliminary, unaudited results for its third quarter ended October 1, 2022. Non-GAAP financial measures referenced in this document are reconciled from GAAP in the attached financial schedules. Unless otherwise indicated, comparisons are to the same period in the prior year.

“We once again delivered strong financial results amidst a dynamic environment,” said Mitch Butier, Avery Dennison chairman and CEO. “LGM and RBIS both delivered impressive top- and bottom-line growth in the quarter, while making great progress in driving further adoption of Intelligent Label solutions.

“The strategic foundations we have laid again position us to deliver double-digit EPS growth for the year, despite ongoing inflationary pressures, currency headwinds and increasing economic uncertainty,” said Butier. “We remain confident that the consistent execution of our strategies will enable us to meet our long-term goals for superior value creation through a balance of profitable growth and capital discipline.

“Once again, I want to thank our entire team for continuing to raise their game to address the unique challenges at hand and deliver value for all our stakeholders.”

Third Quarter 2022 Results by Segment

Label and Graphic Materials
*Reported sales increased 12% to $1.5 billion. Sales were up 20% ex. currency and 20% on an organic basis.
-Label and Packaging Materials sales were up more than 20% on an organic basis, with strong growth in both high value and base product categories.
-Sales increased by mid-to-high single digits organically in the combined Graphics and Reflective Solutions businesses.
-On an organic basis, sales were up mid-teens in North America, approximately 40% in Western Europe, and high-teens in emerging markets.
*Reported operating margin increased 60 basis points to 14.3%. Adjusted EBITDA (non-GAAP) increased 10% to $235 million; adjusted EBITDA margin (non-GAAP) remained strong at 15.6%.
*Inflation continues to be significant in the company’s materials businesses, with it now anticipating more than 20% inflation in 2022 compared to prior year.

Retail Branding and Information Solutions
*Reported sales increased 17% to $623 million. Sales were up 22% ex. currency and 7% on an organic basis.
-High value categories sales were up high-teens on an organic basis.
-Sales decreased by low-single digits organically in base apparel, as customers adjust inventory levels.
-Enterprise-wide Intelligent Labels sales were up approximately 20% year-to-date on an organic basis.
*Reported operating margin increased 120 basis points to 12.2%. Adjusted EBITDA increased 19% to $118 million; adjusted EBITDA margin remained strong at 18.9%.

Industrial and Healthcare Materials
*Reported sales decreased 2% to $192 million, up 5% on an organic basis.
*Reported operating margin increased 100 basis points to 10.6%. Adjusted EBITDA margin of 14.3% was up sequentially and year-over-year.
details at: https://www.investors.averydennison.com/news-releases/news-release-details/avery-dennison-announces-third-quarter-2022-results

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