Avery Dennison has announced its second quarter results, emphasising a US$100m restructure and an intent to achieve its financial aims including double digit earnings growth and higher returns.
Dean Scarborough, chairman, president and chief executive at Avery Dennison, says, “Second-quarter results were in line with our expectations, and we are on track for full-year earnings growth and free cash flow within the ranges of our guidance. We continued to deliver on our commitment to return more cash to shareholders, repurchasing more than two million shares during the quarter.”
Avery Dennison says its label and packaging materials sales increased in mid-single digits compared to the previous year, while graphics and reflective solutions sales declined in low single digits. Consistent with recent trends, sales were flat, reflecting caution from retailers and brands in the U.S. and Europe. For its other specialty converting, sales increased modestly due to increased volume.
The company repurchased 2.4 million shares during the second quarter at an aggregate cost of $70 million. It expects the sale of it office and consumer products business to be completed in the second half of the year.
Scarborough says, “We are aggressively implementing the next phase of our restructuring initiative to help us deliver on our financial targets for double-digit earnings growth and higher returns. Our near-term target is to achieve more than $100 million in annualised savings by mid-2013. The leaner cost structure that will result will enhance our overall competitive position and strengthen our ability to increase returns even in an uncertain economic environment.”