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Sep 30, 2023
Avery Dennison Q3 2023 Earnings Report
Avery Dennison's Q3 2023 performance reflected a decrease in net sales, but adjusted EPS increased sequentially.
Key Takeaways
Avery Dennison reported Q3 2023 results with net sales of $2.1 billion and a reported EPS of $1.71. Adjusted EPS was $2.10, up 9% sequentially. The company is managing inventory destocking and seeing growth in its Intelligent Labels platform.
Net sales reached $2.1 billion, but organic sales decreased by 11%.
Reported EPS was $1.71, while adjusted EPS was $2.10, showing a sequential increase of 9%.
Materials Group sales decreased by 14% to $1.5 billion, with Label Materials sales down high-teens organically.
Solutions Group sales increased by 3% to $642 million, with organic sales up 1%.
Avery Dennison
Avery Dennison
Forward Guidance
The company expects Q4 2023 reported EPS to be between $2.05 and $2.20, and adjusted EPS to be between $2.10 and $2.25.
Positive Outlook
- Further sequential improvement is expected in the fourth quarter.
- The pace of inventory destocking continues to moderate.
- Non-apparel intelligent label programs are expected to accelerate.
- Intelligent Labels platform is expected to deliver more than twenty percent growth annually.
- Adoption accelerates in logistics, food, and general retail.
Challenges Ahead
- Guidance includes an estimated $0.05 per share impact of restructuring charges and other items.
- Global economic conditions may impact underlying demand.
- Cost and availability of raw materials is a risk factor.
- Foreign currency fluctuations could affect financial performance.
- Competitors' actions, including pricing, expansion in key markets, and product offerings, pose a risk.