Beverage can maker Ardagh posts higher profits despite rising energy costs

Beverage can giant Ardagh Metal Packaging (AMP) has reported buoyant sales and profit growth despite soaring energy costs affecting its European business.

he New York-listed company is owned by Irish billionaire Paul Coulson’s Ardagh Group, which supplies metal and glass packaging to clients such as Diageo, Heineken, Pernod Ricard, Nestlé and Coca-Cola.

AMP Group revenue increased 31 percent (38 percent on a constant currency basis) to $1.3 billion in the three months ended June compared to 2021 due to higher costs to customers were passed on.

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) increased 5 percent (10 percent on a constant currency basis) to $181 million (€179 million).

The boost came from the Americas (mainly Brazil), where second-quarter revenue rose 46 percent to $770 million and Adjusted EBITDA rose 36 percent to $120 million.

The European business reported second-quarter revenue of $533 million, up 15 percent from 2021, and Adjusted EBITDA of $61 million, down 28 percent from the same period last year.

AMP said in a statement that the decline in Europe was due to rising input costs, particularly energy.

The group has contracted its remaining energy needs for 2022 and maintained its estimate of a $25 million net impact this year from European energy inflation.

AMP’s margin fell to 13.9 percent in the second quarter, compared to 17.5 percent a year earlier. At the end of June, it had total liquidity of $761 million.

Chief Executive Oliver Graham said Ardagh met its second-quarter guidance amid “unprecedented” inflation and supply chain challenges, as well as exchange rate fluctuations.

“Ramping up our investments and outperformance in Brazil contributed to strong shipment growth over the period.

“We are actively seeking a recovery from our exceptional inflationary costs of energy and are focused on a disciplined build-out of additional capacity, which will be appropriately re-tiered to match demand.”

Last year, Ardagh announced it would build a $200 million beverage can manufacturing facility near Belfast to serve its Irish, UK and European customers.

Earlier this month, the Ardagh Group was awarded $84 million by the International Court of Arbitration in a patent dispute over its US glass business, which it bought from French company Saint-Gobain in 2014.

The German arm of AMP was recently denied EU trademark protection for the noise made when one of its aluminum beverage cans is opened.

https://www.independent.ie/business/irish/drinks-can-maker-ardagh-sees-earnings-uptick-despite-energy-cost-spike-41874646.html Beverage can maker Ardagh posts higher profits despite rising energy costs

Fry Electronics Team

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