Slide 1: 2020 Half Year Results
2020 Half Year Results Ron Delia CEO Michael Casamento CFO February 11, 2020 US NYSE: AMCR | ASX: AMC February 12, 2020 Australia
Slide 2: Disclaimers
Disclaimers Cautionary Statement Regarding Forward-Looking Statements This presentation contains certain statements that are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act
Slide 3: Safety: Committed to our goal of 'no injuries'
Safety Committed to our goal of ‘no injuries’ Recordable-case frequency rate 6% fewer RC’s than 1H19 on a comparable basis 4.5 4.1 4.0 4 Acquisition • 65% of Amcor sites injury free in the 3.5 3.4 impacts 3.2 first half 3 2.6 2.6 2.5 2.4 • Focused on aligning safety practices 2 2.0 2.0 2.0 2.1 acros
Slide 4: Key messages for today
Key messages for today Good first half result; improved outlook for fiscal 2020 1. H1 earnings growth and strong cash flow 2. Full year 2020 outlook improved 3. Bemis integration progressing well 4. Leading the way on sustainability 5. Uniquely positioned for the long-term 4
Slide 5: Half year adjusted financial results
Half year adjusted financial results(1) Strong earnings growth Faster synergy delivery >$600 million cash returns to shareholders $699 m 11.3% $473 m 29.2 cps Quarterly 22 million dividend of shares 11.5 cps repurchased +4.4% +70 bps +10.3% +10.7% EBIT EBIT Net EPS margin income Growth vs prior year
Slide 6: Bemis acquisition: FY20 synergy outlook increased to $80m
Bemis acquisition: FY20 synergy outlook increased to $80m Cost synergies of ~$30(1) million in the first half; On track to deliver $180 million(2) by end of year three Expected from the following areas: Estimated realization ($m): 40% 100% 180 130 20% 80 40% 30 30 30 Procurement Operations G&A & oth
Slide 7: Flexibles segment
Flexibles segment Organic growth plus delivery of synergy benefits Adjusted EBIT(1) Adjusted EBIT • Volume growth in the larger Flexibles North America ($m) margin(1) and European businesses. 12.8% • 8% EBIT growth: 620 • 5% organic growth 11.6% • 3% synergy benefits ($20 million)(2) 582 • Strong co
Slide 8: Rigid Packaging segment
Rigid Packaging segment Cycled a strong first half comparative; growth expected in second half Adjusted EBIT(1) Adjusted ($m) RoAFE(1) (2) • North America 149 • Overall mix unfavourable leading to higher costs, compared 17.7% with favourable mix benefits last year 130 16.5% • Beverage volumes flat (
Slide 9: Strong cash flow and cash returns to shareholders
Strong cash flow and cash returns to shareholders Supported by earnings growth and working capital improvements Cash flow ($ million) 1H20 FY20 outlook Adjusted EBITDA 911 Interest and tax payments (181) Shares Dividends Capital expenditure (net of asset sale proceeds) (204) repurchased $391m Moveme
Slide 10: Strong balance sheet and debt profile
Strong balance sheet and debt profile Balance sheet Dec 19 Debt profile Dec 19 Net debt ($ million) 5,537 Fixed / floating-interest rate ratio 29% fixed Net interest expense ($ million) 99 Bank debt / total debt 13% bank EBITDA interest cover (x) 8.8 Undrawn committed facilities ($ million) 1,916 Ne
Slide 11: Improved outlook for fiscal 2020
Improved outlook for fiscal 2020 Fiscal 2020 guidance Previous FY20 Current FY20 FY19 combined guidance guidance Estimated adjusted EPS constant currency growth % 5-10% 7-10% Adjusted EPS (cps) in constant currency terms 58.2 cents 61.0-64.0 cents * 62.0-64.0 cents * Pre-tax synergy benefits $65 mil
Slide 12: Amcor Strategy
Amcor Strategy Our businesses FOCUSED PORTFOLIO: Flexible Packaging Rigid Packaging Specialty Cartons Closures Our differentiated capabilities THE AMCOR WAY: Our winning aspiration Significant THE leading growth opportunities global packaging company WINNING FOR CUSTOMERS, EMPLOYEES, INVESTORS AND T
Slide 13: Capital allocation framework
Capital allocation framework Amcor Shareholder Value Creation Model Dividend (~ $750m) Historical yield of ~ 4% Strong, Total shareholder defensive cash Reinvestment Organic EPS growth value of 10-15% per (~ $500m) of ~ 3-4% annum with low flow volatility Acquisitions and/or buy-backs EPS growth of
Slide 14: Fully committed and investing $50 million
Fully committed and investing 2025 Pledge announced Jan 2018 Targeted investment: Develop all our packaging to be Increase use of post-consumer Collaborate to increase $50 million recycling rates R&D infrastructure, recyclable or recycled content worldwide manufacturing equipment and reusable by 202
Slide 15: Our Sustainability Point of View
Our Sustainability “Point of View” There will always be a Requirements of packaging are Responsible packaging Amcor is uniquely role for packaging increasing: end of life solutions / is the answer positioned and taking waste reduction are critical action to lead the way Consumers want Achieving less
Slide 16: Responsible packaging is the answer
Responsible packaging is the answer Achieving less waste takes: Packaging Waste Consumer design management participation infrastructure Greenhouse gas Recycling emissions* rate (%) Flexible 5 0 packaging PET bottle 7 30 Composite carton 6 10 Aluminium can 27 66 Glass bottle 26 33 Source: PTIS Global
Slide 17: Uniquely positioned and taking action: Innovation
Uniquely positioned and taking action: Innovation Lighter Weight Recyclable 17
Slide 18: Uniquely positioned and taking action: Innovation
Uniquely positioned and taking action: Innovation Existing product Conversion from Brand relaunch now 100% glass to in PET recycled PET 100% recycled PET Continued innovation: >200k tonnes less virgin resin used p.a. by 2025 Effective markets: >1 million tonnes recycled resin demand created through
Slide 19: Uniquely positioned and taking action: Collaborating and informing
Uniquely positioned and taking action: Collaborating and informing Bilateral top-to-top customer summits 19
Slide 20: Summary
Summary Good first half result; improved outlook for fiscal 2020 1. H1 earnings growth and strong cash flow 2. Full year 2020 outlook improved 3. Bemis integration progressing well 4. Leading the way on sustainability 5. Uniquely positioned for the long-term 20
Slide 21: 2020 Half Year Results supplementary information
2020 Half Year Results supplementary information 11 February 2020 US NYSE: AMCR | ASX: AMC 12 February 2020 Australia
Slide 22: Amcor: Global leader in consumer packaging
Amcor Amcor: Global leader in consumer packaging profile 27% Rigid Packaging #1 ~ $3bn North America Flexibles Flexibles #1 FY19 46% EMEA North America #1 sales mix ~ $6bn 3% ~ $0.5bn Flexibles #1 Asia Pacific 24% ~ $3bn Rigid Packaging Latin America #1 Flexibles North America Western Europe Latin A
Slide 23: Focused global portfolio
Amcor Focused global portfolio profile $13bn combined sales by product type, end market and geography Closures Other Australia Specialty 3% 14% & NZ Emerging cartons 3% markets 9% Western HPC Europe 27% 6% 24% Flexible Food Rigid packaging packaging product 67% Healthcare end market 44% geography 21
Slide 24: Amcor Flexibles overview
Amcor Amcor Flexibles overview profile Combined sales by Combined sales by region end market 11% 17% 38% 6% 36% 8% 54% 15% 15% Europe, Middle East and Africa Food Healthcare Asia Pacific Beverage North America Home & Personal care Latin America Other 2019 combined 2019 combined Plants Countries Empl
Slide 25: Bemis acquisition: strategic rationale
Bemis acquisition: strategic rationale Stronger value proposition for customers, employees Global and the environment Best-in-class footprint capabilities Flexibles Europe Flexibles North America $3.3bn sales Commitment to Greater scale environmental $3.3bn sales sustainability Flexibles Asia $1.3bn
Slide 26: Amcor Rigid Packaging overview
Amcor Amcor Rigid Packaging overview profile Sales by geography Sales by product category 19% 6% 14% 29% 28% North 13% America Latin America USD 2.3bn USD 0.6bn sales sales 73% 81% 37% North America Latin America Cold fill beverage Hot fill beverage Specialty containers Closures 2019 Sales 2019 Adju
Slide 27: North America beverage
Amcor North America beverage profile North America Amcor Rigid Packaging – FY19 beverage market volume mix – FY19 100% 8% 2% 90% 80% 70% 60% 45% 50% 40% 55% 30% 20% 10% 0% ARP volumes ARP margin Source: IRI Still water All other All Other NA Still water 27
Slide 28: Sustainability: There will always be a role for packaging
Sustainability There will always be a role for packaging Extending shelf life Reducing food waste Protecting the environment Food waste accounts for Refrigerated Shelf Life in days Lettuce 2-4 14 30% of food is wasted globally 8% of global GHG emissions Fresh 2-3 Alternative Plastic Grams of red mea
Slide 29: Requirements are increasing: end of life solutions are critical
Sustainability Requirements are increasing: end of life solutions are critical Consumers buying more Small price to pay environmentally friendly products Today vs 5 years ago 72% <1cent US cents per bottle Next 5 years 81% or 0.45% retail price 66% of global consumers (76% of millennials) ~1cent US
Slide 30: Amcor is uniquely positioned to lead the way
Sustainability Amcor is uniquely positioned to lead the way Innovating and developing new products Recycled content Lighter Weight Recyclable 100% PCR 21gr 18gr 200,000 tons reduction in virgin plastic by 2025 30
Slide 31: 2020 Half Year Results appendix
2020 Half Year Results appendix 11 February 2020 US NYSE: AMCR | ASX: AMC 12 February 2020 Australia
Slide 32: FX translation impact
FX translation impact 1H20 currency impact Combined net income currency exposures(1) Total currency impact $ million Adjusted EBIT (9) EUR, 20-30% Adjusted net income (7) EUR:USD Euro weakened vs USD. Average USD million impact on USD to EUR rate 1H20 0.9013 vs adjusted net income for 1H19 0.8682 1H
Slide 33: Reconciliations of non-GAAP financial measures
Reconciliations of non-GAAP financial measures (1) Includes costs associated with the Bemis acquisition. The half year ended December 31, 2019 includes $58 million of acquisition related inventory fair value step-up recognized in the September 2019 quarter. 33 (2) The half year ended December 31, 20
Slide 34: Reconciliations of non-GAAP financial measures
Reconciliations of non-GAAP financial measures (1) Other includes equity in income (loss) of affiliated companies, net of tax and general corporate expenses. (2) Includes costs associated with the Bemis acquisition. The half year ended December 31, 2019 includes $58 million of acquisition related in
Slide 35: Reconciliations of non-GAAP financial measures
Reconciliations of non-GAAP financial measures (1) Includes cash integration costs of $45 million. (2) Adjusted free cash flow excludes material transaction related costs because these cash flows are not considered to be directly related to the underlying business.. 35