Brambles 9-month Sales Revenue Rises; Upgrades FY22 Guidance

Brambles Ltd. (BXB.AX,BMBLF.PK), a pooling solutions company, reported sales revenue from continuing operations of US$4.07 billion for the first nine months of the financial year ending 30 June 2022, representing an increase of 7% at actual FX rates on the prior corresponding period.

At constant FX rates, growth of 8% reflected ongoing strong price realisation to recover cost-to-serve increases in all regions, including sustained high levels of input cost inflation and increased capital cost of pallets.

Group sales volumes were broadly in line with the prior corresponding period. It represents net new business wins in European pallets and Australian RPCs offsetting lower like-for-like volumes with existing customers in North American and European pallets as these businesses cycled strong demand in the prior year.

In constant-currency terms, the company upgraded its fiscal year 2022 guidance for sales, earnings and Free Cash Flow after dividends.

For the year ended 30 June 2022, Brambles now expects sales revenue growth to be 8%-9% compared to the previous guidance of 6%-8%.

The company now projects annual underlying profit growth of 6%-7%, including approximately US$50 million of shortterm transformation costs compared to the previous guidance of 3%-5%.

Excluding short-term transformation costs, annual underlying profit growth is now expected to be between 11%-12% compared to the prior guidance of 8%-10%.

Free Cash Flow after dividends is expected to be a net outflow of US$300-US$350 million compared to previous guidance of net outflow of about US$350 million.

The company expects fiscal year 2022 dividends to be in line with its policy to pay out between 45%-60% of underlying profit after finance costs and tax in US dollar terms.

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