07.澳大利亚纸制品与包装行业报告-2019年2月.pdf

pggPaper & PackagingPaper & PackagingResultsAustralasiaAustraliaIndustryPaper & PackagingDate1 February 2019Deutsche BankResearchFebruary 2019 reporting seasonpreviewPackaging results to be mixed (in-line to slightly disappointing), however,expectations are quite low and raw material costs are easingWe expect the results of the Packaging companies in the upcoming reportingperiod to be mixed with Amcor and Pact Group broadly meeting marketexpectations, however, Orora could marginally disappoint given challengingconditions in North America. We expect Amcor to reiterate its full year earningsguidance for constant currency earnings growth, however, we remain of the viewthat the proposed Bemis acquisition (delayed to the June quarter) will be the keydriver of the share price. We expect Pact could upgrade its full year earningsguidance to reflect easing raw material costs in both USD and AUD. While thiswon’t benefit first half earnings, it should certainly benefit the second half. Wehave Buy ratings on Amcor and Pact, and a Hold rating on Orora.Amcor to report Monday, February 11We expect Amcor to report an underlying net profit of US$336.8m in the 6 monthsto December, up 2% on pcp. The consensus estimate is US$330m. We expectEBIT of US$515.2m, flat on pcp, and the consensus estimate is $US517m. Weexpect the Amcor result to broadly meet market expectations for the half andwe expect the company to reiterate its full year guidance for constant currencyearnings growth and solid EBIT growth in both the Flexibles and Rigid Plasticssegments. Raw material costs are easing, we expect North American Beveragevolumes to be up modestly, and we expect the emerging markets to remainmixed. Earnings could be impacted by hyperinflation accounting in Argentina. Webelieve the proposed Bemis acquisition remains the key driver of the share price.Orora to report Wednesday, February 13We expect Orora to report an underlying net profit of $109.7m in the 6months to December, up 4% on pcp. The consensus estimate is $113m. Thecompany has guided to higher constant currency earnings for the full year,subject to global economic conditions. We expect EBITDA of $235.9m, up4% on pcp, and EBIT of A$171.1m, up 3% on pcp. The consensus estimatesare $242m and $184m respectively. We expect Orora’s full year result couldmarginally disappoint given lower than anticipated North American earnings.North American demand remains flat and the company is experiencing higherlabour, freight, and paper costs. OPS remains impacted by the delayed roll-out ofthe ERP while foregone revenue in OV has been replaced at a lower margin. Weexpect cash conversion to decline given increased capex and revised aluminiumsupply arrangements. However, we still expect the company to reiterate its fullMark Wilson, CFAResearch Analyst+61-2-8258-1564Top picksAmcor Ltd (AMC.AX),AUD13.68BuyPact Group (PGH.AX),AUD3.85BuySource: Deutsche BankCompanies featuredAmcor Ltd (AMC.AX),AUD13.68Buy2018A 2019E 2020EP/E (x)18.514.413.2Div yield (%)3.95.05.5Price/book (x)12.78.97.2Orora (ORA.AX),AUD3.20Hold2018A 2019E 2020EP/E (x)19.017.816.6Div yield (%)3.94.24.5Price/book (x)2.62.52.4Pact Group (PGH.AX),AUD3.85Buy2018A 2019E 2020EP/E (x)18.713.511.0Div yield (%)4.25.77.0Price/book (x)3.02.52.4Source: Deutsche BankDeutsche Bank AG/SydneyDeutsche Bank does and seeks to do business with companies covered in its research reports. Thus, investors should beaware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should considerthis report as only a single factor in making their investment decision. DISCLOSURES AND ANALYST CERTIFICATIONSARE LOCATED IN APPENDIX 1. MCI (P) 091/04/2018.Distributed on: 01/02/2019 08:54:08 GMT7T2se3r0Ot6kwoPa1 February 2019Paper & PackagingPaper & Packagingyear guidance for underlying earnings growth in constant currency terms, subjectto global economic conditions.Pact to report Wednesday, February 20We expect Pact to report an underlying net profit of $38.4m in the 6 monthsto December, down 24% on pcp. The consensus estimate is $42m. We expectEBITDA of $116.1m, down 4% on pcp and slightly below the consensus estimateof $118m. We expect EBIT of $73.6m, down 15% on pcp. While we expect theresult to be broadly in-line with market expectations, we believe the companywill likely upgrade its full year earnings guidance to reflect easing raw materialcosts in USD and AUD. We expect the company to provide an update on recentacquisitions, the transformation program, and the search for a new CEO.Valuation and RisksOur primary valuation methodology in the sector is DCF, using company specificWACC based on target debt/equity ratios, TG rates in line with GDP andpretax cost of debt based on company corporate lending rates. Key upside/downside risks include integration of recent acquisitions, packaged food andbeverage demand, currency movements, loss of major customers, changes to thecompetitive landscape and legislative changes.Page ...