New partnerships help Amcor move toward 30% recycled content across its portfolio by 2030

New partnerships help Amcor move toward 30% recycled content across its portfolio by 2030

- Amcor invest approximately $100 million in research and development to help drive long-term growth.
The Pulp and Paper Times

Amcor is a global leader in developing and producing responsible packaging solutions across a variety of materials for food, beverage, pharmaceutical, medical, home and personal-care, and other products.

Amcor works with leading companies around the world to protect products and the people who rely on them, differentiate brands and improve supply chains. The company offers a range of innovative, differentiating flexible and rigid packaging, specialty cartons, closures and services. The company is focused on making packaging that is increasingly recyclable, reusable, lighter weight and made using an increasing amount of recycled content. In fiscal year 2024, 41,000 Amcor people generated $13.6 billion in annual sales from operations that span 212 locations in 40 countries.

“By integrating sustainable practices into every aspect of our operations, we are ensuring our products contribute to a more sustainable future and we are focused on developing solutions that have a lower carbon footprint and support a circular economy for packaging. Currently, almost all of our Rigid Packaging and cartons portfolios are recyclable, compostable or reusable, and in Flexible Packaging, approximately 90% of our portfolio is recyclable or has a recycle-ready alternative. We also continue to increase the use of recycled material in our packaging solutions and we are confident in achieving our goal of 30% recycled content usage across our product portfolio by 2030,” Mr. Graeme Liebelt, Chairman of Amcore said in the annual report for FY 2024.

Peter Konieczny, Chief Executive Officer at Amcor said in the report, “Amcor demonstrated significant resilience through a challenging 2023 calendar year and made substantial Progress through fiscal 2024, delivering a year of strong margin expansion with earnings momentum building through the year. Our disciplined focus on managing costs resulted in annualized cost savings of more than $440 million, helping mitigate the impact of inflation and variable customer and consumer demand. We are encouraged by a return to volume growth in the fourth quarter of fiscal 2024 after a period of soft customer demand,”

Twelve months ended June 30, 2024 : Net sales of $13,640 million were 7% lower than last year on a reported basis, including a favorable impact of approximately 1% related to movements in foreign exchange rates, an unfavorable impact of approximately 1% related to items affecting comparability, and an unfavorable impact of 1% related to the pass through of lower raw material costs of approximately $220 million.

Strategic investment:
Annually, Amcor invest approximately $100 million in research and development to help drive long-term growth. We support the next generation of innovators through Amcor Lift-Off program, whose fiscal 2024 winners include technologies leveraging artificial intelligence for advancements in waste management. 

Amcor also invest in partnerships to build capacity and drive demand for recycled materials, which is a crucial step in closing the loop to create a circular economy for packaging. In fiscal 2024, Amcor achieved its goal of using 10% postconsumer recycled resins in product portfolio, one year ahead of 2025 target. 

“We continue developing new partnerships with recyclers and suppliers of recycled materials to ensure strong supply pipelines across our global markets. One such partnership will enhance our ability to purchase mechanically recycled polyethylene resin for use in flexible packaging films across North America, while another will enable us to source additional advanced recycled material beginning in 2025 that will enable packaging solutions using recycled content for food and healthcare customers in key markets in Asia Pacific. Combined, these partnerships will help Amcor take another important step toward achieving our target of using at least 30% recycled content across our portfolio by 2030,” Mr Peter Konieczny added.

Product innovation:

Amcor annual report stated that bringing new solutions to market requires close partnership with our customers. Some notable collaborations in fiscal 2024 include a number of customer launches of our AmFiber™ solutions across regions, the introduction of our curbside-recyclable AmFiber™ Performance Paper packaging in North America, as well as our partnership with an iconic chocolate brand to transition to 50% food-grade recycled packaging in Australia.

“Additionally, we marked several firsts, including launching our first-ever one-liter carbonated soft drink stock bottle made from 100% post-consumer recycled (PCR) material. We partnered with a cosmetics, skin care and personal care pioneer in China to launch AmPrima™ Plus refill pouches for its line of shower gels, marking the first refill pouch with recycle-ready material. And, we announced the introduction of more than 90% recycled tin into our premium tin capsules and sparkling foils range.” The report added.

Q1 results ended 30th September 24:

The report said, “Our fiscal 2025 year is off to a very good start with broad-based improving customer demand across many end markets. Our teams continue to position Amcor to win with our customers, which resulted in our third consecutive quarter of sequential improvement in volumes. Overall volumes for the fiscal first quarter were up approximately 2% compared with 1% in Q4. As expected and called out in August, volumes remained weak in healthcare in North American beverage, which unfavorably impacted overall company volumes by approximately 2%.”

So across the balance of the business, overall volumes increased by 4% over the September quarter. Price/mix had an unfavorable impact on sales of approximately 3% primarily driven by continued destocking in higher-margin healthcare categories as expected, and as noted on our August earnings call.

Economic and Market Conditions

After experiencing more challenging market conditions in calendar year 2023 which impacted both fiscal year 2023 and fiscal year 2024 with softer consumer and customer demand and increased destocking, customer volume trajectory sequentially improved in the second half of fiscal year 2024 with a return to volume growth in the fourth quarter of fiscal year 2024. The improvement in the second half of fiscal year 2024 is attributed primarily to the abatement of destocking across many end markets and higher customer demand in parts of our business. While we continue to be impacted by softer consumer demand and customer order volatility in certain markets, and higher inflation in certain areas, such as labor costs, we have flexed our cost base to adjust to market conditions. Higher inflation, especially in Europe and the United States over the last two fiscal years, has led central banks to rapidly raise interest rates to dampen inflation which has resulted in higher interest expense on our variable rate debt, particularly on U.S. dollar and Euro denominated debt.
 

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