- Full-year 2015 adjusted diluted EPS from continuing operations increased to $2.55 per share, up 10.9 percent compared to the prior year, and in line with management’s guidance. These results were achieved despite the currency translation headwinds of approximately $0.16 per share in 2015, as compared to the prior year.
- Gross profit margins improved 170 basis points to 21.5 percent of net sales for the full year 2015, compared to 19.8 percent in the prior year.
- US Packaging segment operating profit return on sales increased to 14.3 percent for the full year 2015, compared to 13.1 percent in the prior year.
- Global Packaging segment adjusted operating profit return on sales increased to 8.8 percent for the full year 2015, compared to 7.6 percent in the prior year.
- On December 1, 2015, Bemis announced its acquisition of the rigid plastic packaging operations of Emplal Participações S.A.
US Packaging net sales of $2,747.5 million for 2015 represent a decrease of 4.0 percent, compared to 2014. The first quarter 2014 divestiture of the Paper Packaging Division reduced sales by 1.3 percent. Excluding the impact of divestitures, net sales decreased by 2.7 percent. Unit volumes declined by approximately 2 percent for the full year, primarily from the impact of Bemis’ strategic pricing decisions. The remaining change in net sales was driven by the contractual pass through of lower raw material costs throughout the year, partially offset by favorable sales mix.
US Packaging operating profit increased to $391.8 million in 2015, or 14.3 percent of net sales, compared to $375.8 million, or 13.1 percent of net sales, in 2014. This margin improvement reflects sales mix benefits, driven by the Bemis’ focus on innovation, as well as continued operational improvements, primarily attributable to the asset recapitalization program.
Global Packaging net sales of $1,323.9 million for 2015 represent a decrease of 10.7 percent, compared to 2014. Currency translation reduced net sales by 18.2 percent, primarily due to currencies in Latin America. The December 2015 acquisition of Emplal increased full year net sales by 0.3 percent. Excluding the impact of currency translation and the acquisition, net sales increased by 7.2 percent, fully driven by positive sales price and mix.
Global Packaging operating profit was $107.1 million in 2015, compared to $113.3 million in 2014. Excluding restructuring and acquisition-related costs, segment adjusted operating profit for 2015 would have been $116.5 million, or 8.8 percent of net sales, an increase from 7.6 percent of net sales in 2014. The net impact of currency translation reduced operating profit during 2015 by $24.0 million as compared to 2014, or approximately $0.16 of total company earnings per share, primarily due to currencies in Latin America.
Margin improvement in the Global Packaging segment reflects strong operating performance and the overall favorable impact of increased sales of sophisticated, value-added packaging.
Commenting on the year ahead, President/CEO William F. Austen stated, “In 2016, we expect our growth initiatives and asset recapitalization projects to deliver continued margin improvement. Our EPS guidance is in line with our long-term target to deliver earnings per share improvement in excess of 10 percent per year, on a currency-neutral basis. During 2016, we will continue to focus on growing our business, improving margins, increasing return on invested capital, and generating cash.”
Management expects full year cash from operations to be in the range of $450 to $500 million. This includes continued reductions in working capital that are expected to meet Bemis’ objective of working capital as a percent of net sales in the range of 14 to 16 percent by the end of 2016.
Management expects capital expenditures for 2016 of approximately $200 million to support productivity and efficiency projects as well as growth projects driven by increased customer demand for value-added products.