Brambles Lifts Lower End of Fiscal Year Guidance Ranges on Strong 1Q -- Update
By Stuart Condie
SYDNEY--Brambles Ltd. raised the lower end of its fiscal 2021
revenue and earnings guidance ranges after unexpectedly strong
demand for consumer staples helped the pallet supplier to lift
first-quarter sales revenue by about 6%.
The Australia-listed firm on Tuesday reported sales revenue from
continuing operations for the three months through September of
US$1.19 billion, up by about 6% when adjusted for the prior
corresponding period's two additional days. Stripping out currency
changes, it said the increase was about 5%.
Brambles said it now anticipates fiscal 2021 sales revenue
growth of 2-4% at constant foreign exchange rates, compared with
the 0%-4% range provided at August's annual result and reiterated
at October's annual meeting of shareholders. It expects improved
underlying profit margins, including a one percentage-point
increase in U.S. margins.
It expects underlying profit growth of between 3% and 5%,
compared with a previous 0-5% range. It said free cash flow should
be sufficient to fund dividends and core business capital
expenditure despite increased investments to support new core
Brambles Chief Executive Graham Chipchase said first-quarter
demand in grocery supply chains had been strong despite variability
in categories such as beverages, cleaning products and home
He said demand had remained elevated in early October as
customers and retailers increased inventory levels across the U.S.
in preparation for the holiday season and potential lockdown
measures to contain a second wave of Covid-19 infections.
"We have noted some moderation in U.S. issue volumes during the
second half of October and we expect this variability to continue
across our businesses for the remainder of fiscal 2021," Mr.
Chipchase said in a filing to the Australian Securities
Mr. Chipchase said activity levels in its automotive and Kegstar
beverage unit improved on the fourth quarter of fiscal 2020, but
remained down on the year-earlier period. He said Brambles
anticipated a progressive recovery in the units over the next 12-18
Write to Stuart Condie at email@example.com
(END) Dow Jones Newswires
November 02, 2020 18:19 ET (23:19 GMT)
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