Avery Dennison Corp (NYSE:AVY) reported a Q2 FY23 sales decline of 10.9% Y/Y to $2.09 billion, missing the analyst consensus of $2.16 billion.
Reported sales for the Materials group decreased by 12.6% Y/Y to $1.48 billion, and Solutions Group declined by 6.5% Y/Y to $614.5 million.
Gross profit fell to $553.4 million from $643.5 million a year ago
It reported adjusted operating margin of 11.2%, a contraction vs. 13.2% the prior year, with adjusted operating income declining to $233.8 million from $310.8 million the prior year.
The company held $217.1 million in cash and equivalents as of July 1, 2023. Operating cash flow for the six months was $191.5 million.
Adjusted EPS of $1.92 missed the consensus of $1.99.
The company repurchased 0.5 million shares for $90 million in H1 2023.
In H1, the company recognized around $24 million in pre-tax savings from restructuring (net of transition costs) initiatives and incurred pre-tax restructuring charges of around $28 million.
Outlook: AVY expects Q3 2023 adjusted EPS of $2.00-$2.20 vs consensus of $2.47.
In May, AVY appointed Deon Stander as the new president and chief executive officer, effective September 1, 2023, replacing Mitch Butier, who will retire from the position and remain the company’s executive chairman.
Price Action: AVY shares are trading lower by 3.01% at $172.26 on the last check Tuesday.
