Orora delivers solid first half result

Orora Limited (ASX: ORA) has announced a solid set of financial results for the half year ended 31 December 2020.

Commenting on Orora’s Half year result, Managing Director and CEO, Brian Lowe, said “We are pleased to announce that all businesses reported an increase in underlying EBIT compared to the prior corresponding period as a result of disciplined execution against our revised strategy.

“In Australasia, Orora’s market leading Beverage business continued its track record of earnings growth. The earnings improvement was predominately driven by strong volumes across Cans and Closures.  Volume gains were partially offset by an unfavourable mix in Cans and Glass driven by an increase in at home consumption and ongoing higher energy and insurance costs.

“In North America, constant currency earnings were higher for both Orora Packaging Solutions (OPS) and Orora Visual (OV), following increased sales force effectiveness and a strong focus on cost control measures. OPS returned to revenue growth and is well positioned in a growing and diverse customer market. The impact of COVID-19 in North America was materially greater than that felt in Australasia, with many retailers remaining closed, negatively impacting OV revenue for the period.

“Orora’s strong cash flow capability, combined with the strength of its balance sheet, continues to provide the Company with operating and strategic flexibility to invest in innovation, as well as organic and new growth opportunities that deliver long term, sustainable value."

“As previously communicated, the focus is on leveraging the Australasian Beverage capabilities via exploring footprint expansion and complementary products and services. A preliminary assessment of international Beverage footprint expansion is underway, and we continue to  actively assess and invest in our future requirements to meet customer and consumer needs. To this end, we have completed the rebuild of the G2 glass furnace at Gawler, we are increasing recycled content in glass, and we have commenced expansion into slim cans at Revesby.

“In respect of North America, new leadership is steering both OPS and OV in a positive direction and is aligned to our revised strategy and strategic priorites. OPS is entering the second phase of our strategy as we position the business for sustainable growth.  We will review the strategic direction of OV by the end of calendar year 2021.” Mr Lowe said.

More information about our results for the half year ended 31 December 2020 available under ASX releases.