Packaging company Orora has seen out the end of its financial year with growth in net profit after tax (NPAT) up 14.4 per cent to $186.2m and sales revenue up 4.9 per cent to $4bn for its full year results.

However, its net debt increased from $630m to $674m from last year’s results. Its earning per share (EPS) was also up at 14.6 per cent to 15.6 cents and EBIT up 11.1 per cent to $302.3m.

Its final ordinary dividend of 6.0 cents per share, 30.0 per cent franked. Total dividend is 11.0 cents, up 15.8 per cent. Orora’s operating cash flow was $331.5m, up from $313.8m, its statutory net profit after tax (NPAT) was $171.1 million.

Orora says it has delivered double-digit underlying NPAT, EBIT and EPS growth for the third consecutive year.

Nigel Garrard, managing director and CEO, Orora says, “Operationally the business has delivered another strong performance, driven by the strength and resilience of the Group’s core businesses and augmented by investments Orora has made to drive growth, particularly with establishing a national footprint for Orora Visual in the North American point of purchase (POP) and visual communication sector.”

“Orora Australasia delivered solid earnings and sales growth which more than offset input cost headwinds. In North America, the business delivered constant currency earnings growth of 23.1 per cent and now, with a second stream of earnings beginning to flow from Orora Visual, has contributed more than 50 per cent of Orora’s sales for the first time.”

[Related: Orora grows despite economic climate]

Orora Australasia delivered a 6.6 per cent increase in EBIT to $213.6m, with sales revenue 2.3 per cent higher to $2bn. Both Australasian business groups – Fibre Packaging and Beverage – delivered earnings growth despite flat economic conditions and higher input costs.

Excluding significant item expense of $15.1m in FY17 and significant item gain of $5.9m in FY16. An after tax significant item expense of $15.1m relating to additional expected decommissioning costs at the Petrie Mill site has been recognised in FY17.

Garrard says, “Since listing on the ASX in late 2013, Orora has been executing The Orora Way operating model, which encompasses the company’s strategic pillars of enhancing the core, innovating to lead and investing to grow. The Group’s disciplined focus and successful delivery against this operating model has guided Orora to more than double earnings over that period.

“Importantly, Orora’s strong cash conversion combined with the strength of its balance sheet, provides the Company with capacity and flexibility to continue to invest with discipline in innovation as well as organic and new growth opportunities, to deliver sustainable value creation for shareholders.”

Fibre Packaging earnings were higher driven by further cost reduction and innovation benefits and the achievement of sales growth in targeted market segments. The beverage business earnings growth was driven by higher glass volumes and improved operating efficiencies across both the glass and cans businesses, which more than offset input cost headwinds in the glass division and marginally lower volumes in cans.

[Related: Orora acquisitions complete]

During the year, Orora continued to invest in a range of focused initiatives projects, innovation and acquisitions to drive sustainable future growth, including $141m to acquire three further North American POP and visual communication businesses to establish a national footprint – Register (New Jersey), Garvey Group (Chicago and Los Angeles) and Graphic Tech (Los Angeles).

Successful completion of the $42m investment to increase manufacturing output of the Gawler glass furnaces by 60 million bottles with the project expected to exit FY18 contributing EBIT in line with Orora’s return criteria. Also a $25m to upgrade the plant and machinery at the Revesby Fibre Packaging plant which will be progressively commissioned in FY18.

A further $15m, as part of the $45m Orora Global Innovation Initiative, to a range of projects that enhance innovation, modernisation and productivity, taking the cumulative approvals under this initiative to approximately $29 million.

Orora says it expects to continue to drive organic growth and invest in innovation and growth in the year ahead, with constant currency earnings expected to be higher than reported in FY17, subject to global economic conditions.

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