Avery Dennison Corporation said net sales for its third quarter ended October 1, 2022 increased by 11.8% to $2.3 billion - “despite ongoing inflationary pressures, currency headwinds and increasing economic uncertainty” - with earnings per share (EPS) up 38%. Label and Graphic Materials sales increased 12% to $1.5 billion.
Avery Dennison opened its new distribution centre in Moorabbin, Victoria in Sept 2022
“We once again delivered strong financial results amidst a dynamic environment,” said Mitch Butier, Avery Dennison chairman and CEO.
“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. 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."
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.
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.
Balance Sheet and Capital Deployment
During the first three quarters of the year, the company deployed $37 million for acquisitions and returned $497 million in cash to shareholders, up $207 million compared to last year, through a combination of share repurchases and dividends.
Guidance
The company has narrowed its guidance range for 2022 reported earnings per share from $9.60 to $9.90 to $9.65 to $9.80.
Highlights:
3Q22 Reported EPS of $2.70, up 38%
Adjusted EPS (non-GAAP) of $2.46, up 15%
3Q22 Net sales increased 11.8% to $2.3 billion
Sales growth ex. currency (non-GAAP) of 19.0%
Organic sales growth (non-GAAP) of 15.5%
Narrowed FY 2022 EPS guidance
Reported EPS of $9.65 to $9.80 (previously $9.60 to $9.90)
Adjusted EPS of $9.70 to $9.85 (previously $9.70 to $10.00)
