Orora Group (ORA) H2 2024 earnings summary

Executive summary

• Utilization rates across the Saverglass network remain around 60%, with inventory levels being actively reduced to avoid unnecessary production.

• Revenue rose 9.5% to $4,697.6m, driven by the Saverglass acquisition, which contributed seven months of results.

• Underlying EBIT increased 26.0% to $404.0m; underlying NPAT up 10.2% to $223.7m.

• EBITDA is expected to increase on a run-rate basis, driven by improved mix, cost improvements, and normalization of customer inventories.

• Synergy realization from the Saverglass acquisition is on track, with AUD 15 million targeted by 2026.

Financial highlights

• Saverglass sales volumes were down 11% year-over-year, with utilization rates varying by site.

• Underlying EPS declined 19.4% to 17.9 cps due to equity raising dilution.

• Statutory results include $38.5m post-tax transaction costs for Saverglass acquisition.

• Free cash flow available to shareholders increased to $56.3m, up from $13.3m.

• Capex of $256m, supporting growth and sustainability initiatives.

Outlook and guidance

• First half of FY 2025 is expected to be consistent with the second half of FY 2024, with potential uplift in the second half as destocking ends.

• Saverglass to deliver higher full-year EBIT with volume recovery expected from early CY25.

• FY25 capex guidance of $240m–$260m; net finance costs $130m–$135m; dividend payout target 60–80% of NPAT.

• Net debt is expected to hold steady in FY 2025, with deleveraging anticipated from FY 2026 as earnings recover post-G3 CapEx.

• Amortization and depreciation guidance now includes PPA adjustments, and future guidance will reflect these changes.