The government and ASIC are demanding banks and financial service providers strengthen their scam and fraud defences. With this nefarious activity costing Australians $318 million in the past 15 months alone, the industry’s positive response has not come quickly enough.
With industry funds feeling the heat from APRA, it’s likely more members will look for a better option, especially if they are nearing or in retirement. Those choosing to do so need to tread warily.
Planned merger to cement Amcor’s global packaging footprint
The multinational flexibles and packaging group, Amcor (ASX:AMC), is on the cusp of sealing a transformational $13 billion deal by merging with the Indiana-based packaging group, Berry Global.
If shareholders from both groups approve the deal on February 25, the all-scrip transaction, which will give Amcor shareholders about 63 per cent of the combined group, will create a company with 400 packaging plants and 75,000 staff worldwide.
Amcor, which listed on the New York Stock Exchange in 2019, has emerged from its Australian-focussed papermaking activities – it began in the 1860s when Samuel Ramsden established Victoria’s first paper mill on the banks of the Yarra River – to become a dominant player in the global packaging industry.
The key to the merger succeeding will be Amcor’s ability to manage the integration of the two businesses, as well as stripping out costs. While never easy, Amcor, which saw its share price rise 10 per cent in the past year to close at $15.82 on Tuesday, has a proven track record in this regard after successfully integrating Bemis Company, a Wisconsin-based packaging group it acquired for about $9 billion in 2019.
While the Berry acquisition is the headline news for Amcor, the day-to-day operations continue to perform with its first quarter results for the 2025 financial year painting a picture of steady improvement and strategic focus on shareholder returns, despite challenging market conditions.
It’s projecting adjusted earnings per share of between 72 and 76 cents, representing a three to eight per cent increase on a comparable constant currency basis. This outlook, while conservative, reflects the company’s realistic approach to managing expectations in a complex global market environment.
The company’s volume growth trajectory is particularly encouraging, with the first quarter of 2025 marking the third consecutive quarter of sequential improvement. Overall volumes were up about two per cent compared with the previous year, demonstrating resilience in most markets despite ongoing softness in healthcare categories and the North American beverage business.
The company remains focussed on maintaining margin quality as evidenced in its first quarter results, with the adjusted EBIT margin improving to 10.9 per cent, a 50-basis point increase over the previous year. This improvement, achieved despite lower sales, showcases the company’s effective cost management and operational efficiency initiatives.
Amcor maintains a disciplined approach to capital allocation, balancing organic growth investments, strategic M&A opportunities, share repurchases and dividend growth.
Notably, Amcor has increased its quarterly dividend to 12.75 US cents a share (20.1 AU cents), up from 12.5 US cents (19.8 AU cents) in the same quarter last year, reinforcing its commitment to delivering to shareholders. In the 2024 financial year, they received an annual payout of 50 US cents (79 AU cents) – the fifth consecutive year shareholders received an increase – with the likelihood being it will happen again in 2025.
Geographic diversity remains a key strength for Amcor, with the first quarter showing increased sales and volumes in India, China and Latin America. European market optimisation continues to show promise, with volumes growing at mid-single digit rates in key categories. North America presents recovery opportunities, particularly in the beverage segment.
The flexibles segment shows promising signs with three per cent volume growth in the first quarter and margin improvement to 12.9 per cent. Strong performance in meat, liquids, and fresh and frozen foods categories underscores the segment’s resilience.
The investment case for Amcor is supported by several compelling factors. The increased quarterly dividend demonstrates management’s confidence in the company’s cash generation capabilities and commitment to shareholder returns. Continued focus on cost management and restructuring initiatives should support margin protection in a challenging cost environment.
