Packaging giant Amcor has boosted profit 7.5 per cent with continued focus on acquisitions and record sales growth in Asia.

The packaging multinational posted a $946.8m profit with a sales growth of 2 per cent to $13.38bn and PBITDA up 3.4 per cent to $1.98bn, all in constant currency terms.

However, the increases are far lower than the 24.6 per cent profit and 14.4 per cent sales jumps of FY14, reflecting slowing growth in China and some other markets.

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Ron Delia, in his first results announcement as chief executive, says Amcor needs to become more self-sufficient in keeping its growth going instead of relying on the growth of its customers.

“Those days are over,” he says, saying engaging more with customers, investing in innovation and yet more acquisitions are the way forward.

The strong greenback, particularly against the Australian dollar, means in cash terms profit only increased 0.4 per cent and sales fell 3.5 per cent, but this is not reflective of overall trends.

Delia says Australian earnings were significantly higher mostly due to ‘synergy benefits’ from the Aperio and Detmold acquisitions, with earnings from Detmold exceeding targets. Australia only represents five per cent of global sales, but with solid profit.

However, he says Australian sales growth is ‘flat’ at 1-2 per cent, as with most developed economies and that emerging markets are where most of Amcor’s growth is.

These markets now make up 34 per cent of sales, up from 32 per cent six months ago, and grew 6 per cent this year, making the total growth 17 per cent since 2000. Asian flexibles business grew 9.1 per cent to a record $1.45bn.

Delia says emerging markets are a ‘long term game’ with some growing slower than they could be and more volatile than developed regions, with China a good example.

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Amcor’s development of new packaging technology is seen as a key driver of long term success and becoming a technology developer as well as a manufacturer will be an important point of difference going forward.

Reflecting that Australia is an increasingly small part of its business, Amcor in May moved its corporate headquarters to Zurich along with 30 of the 50 jobs at its Melbourne office, along with Delia himself.

However, Delia says this does not signal a full pullout from the country as it is an important market where it is the flexibles leader, and a very important part of the crucial Asia Pacific region.

“It is also where we have our stock market listing and we see no reason to change that as the ASX has been a great source of liquid capital,” he says.

The company’s improved cashflow gave it a surplus of cash which it in February decided to use some of for a $640m share buyback to return some value to shareholders, along with an increased dividend.

Delia says the buyback will boost earnings per share by three per cent next year.

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