“In 2014, we delivered 16 per cent growth in adjusted earnings per share, significantly increased return on capital, and distributed over $480 million of cash to shareholders, CEO of Avery Dennison said.
CEO Dean Scarborough said, “Pressure-sensitive Materials delivered its third consecutive year of strong volume growth, while maintaining its profitability and high return on capital.”
While releasing preliminary results for fourth quarter and fiscal 2015, he added, “We are taking further actions to improve PSM's long-term competitive position as we continue to invest in growth.”
According to Scarborough, Retail Branding and Information Solutions faced top-line growth challenges, reflecting share loss in the value and contemporary segments, offset by solid growth in RFID and performance segment.
“We are focusing our sales efforts to recapture share, while reducing fixed costs and aligning resources to better serve all segments of the market,” he noted.
For the fourth quarter of fiscal 2015, Pressure-sensitive Materials (PSM) segment sales rose around 2 per cent and Label and Packaging Materials segment sales hiked in low single digits.
While combined sales of Graphics and Performance Tapes division increased in mid-single digits.
Operating margin improved 60 basis points to 10.1 per cent as the benefit from productivity initiatives and higher volume was partially offset by net impact of raw material input costs and pricing.
Retail Branding and Information Solutions (RBIS) segment sales were down around 5 per cent year on year in the fourth quarter of fiscal 2015 from lower volume in Europe and North America.
According to Avery Dennison, operating margin dipped to 5.5 per cent as the impact of lower volume, a prior year gain on sale of assets more than offset the benefit from productivity initiatives and lower employee costs.
The company repurchased 7.4 million shares in 2014 at an aggregate cost of $356 million and the full year tax rate was 31.1 per cent, below previous expectations of 33 per cent.
In 2014, the company realized around $35 million in savings from restructuring, net of transition costs, and incurred restructuring costs of around $66 million, $55 million of which represents cash charges.
“We expect to increase earnings per share in 2015, despite a significant headwind from currency translation,” said Scarborough.
"We remain committed to achieving our long-term financial targets, growing through innovation and differentiated quality and service, with a continued focus on cost and capital discipline," he observed.
