Avery Dennison Q2 2020 Earnings Report
Key Takeaways
Avery Dennison reported a decrease in net sales by 14.9% to $1.53 billion due to the impact of the COVID-19 pandemic, with sequential improvement in sales in May and June. Despite the sales decline, the company's adjusted EPS of $1.27 was above expectations, and the company is focused on protecting profitability and investing in high-value categories.
Second quarter revenue came in better than expected with sales improving sequentially in May and June after a sharp decline in April.
Adjusted EBITDA margin was above prior year.
The company is protecting investments to expand in high value categories, particularly RFID.
The company is targeting to deliver free cash flow of approximately $500 million in 2020.
Avery Dennison
Avery Dennison
Forward Guidance
The company expects sales and earnings to decline in 2020 with the second quarter representing the trough. In the third quarter, the company anticipates a decline in sales before the impact of currency translation in the range of 5 percent to 7 percent, or 7 percent to 9 percent on an organic basis.