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Apr 01, 2023
Avery Dennison Q1 2023 Earnings Report
Avery Dennison's financial performance was in line with expectations in Q1 2023, despite lower revenue due to higher-than-anticipated inventory destocking.
Key Takeaways
Avery Dennison reported a 12% decrease in net sales to $2.1 billion and EPS of $1.49. Adjusted EPS was $1.70, a 29% decrease. The company revised its full-year EPS guidance downwards, citing a softer outlook for the second quarter.
Q1 2023 Reported EPS was $1.49.
Adjusted EPS (non-GAAP) was $1.70, down 29%.
Net sales declined 12% to $2.1 billion.
The company revised FY 2023 EPS guidance.
Forward Guidance
The company has revised its guidance range for 2023 reported earnings per share from $8.85 to $9.25 to $8.35 to $8.70. Excluding an estimated $0.50 per share related to restructuring charges and other items, the company revised its guidance range for adjusted earnings per share from $9.15 to $9.55 to $8.85 to $9.20.
Positive Outlook
- Intelligent label programs are expected to accelerate.
- Apparel volume is expected to rebound in the second half of 2023.
- Solutions Group adjusted EBITDA margin is expected to sequentially improve.
- The company anticipates label destocking to be largely complete by mid-year.
- Materials Group adjusted EBITDA margin is expected to improve sequentially throughout 2023.
Challenges Ahead
- Underlying demand for products is impacted by global economic conditions.
- Cost and availability of raw materials.
- Competitors' actions, including pricing and expansion in key markets.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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