Avery Dennison Reports Strong Q3 and Nine-Month Fiscal 2024 Results with Net Sales and Net Income Growth

Avery Dennison Corporation reported strong financial performance for the third quarter and the first nine months of fiscal 2024, with notable increases in net sales, gross profit, and net income compared to the same periods in the previous year.

For the three months ended September 28, 2024, net sales reached $2,183.4 million, a 4% increase from $2,098.3 million in the same quarter of 2023. For the nine months, net sales totaled $6,570.0 million, up 5% from $6,253.8 million. The growth was driven by higher volumes and productivity initiatives, particularly in the Materials Group, which reported net sales of $1,497.7 million for the third quarter, compared to $1,456.0 million in the prior year.

Gross profit for the third quarter was $626.6 million, up from $585.8 million, resulting in a gross profit margin of 28.7%, an increase from 27.9% year-over-year. For the nine months, gross profit rose to $1,921.5 million from $1,681.5 million, with a margin of 29.2%, up from 26.9%.

Net income for the third quarter was $181.7 million, compared to $138.3 million in the same period last year, while net income for the nine months increased to $530.9 million from $359.9 million. This resulted in net income per common share of $2.26 for the third quarter and $6.60 for the nine months, compared to $1.72 and $4.46, respectively, in the prior year.

The company’s operational cash flow also improved, with net cash provided by operating activities increasing to $587.6 million for the nine months ended September 28, 2024, from $514.1 million in the same period of 2023. Adjusted free cash flow for the same period was $420.0 million, up from $373.6 million.

Avery Dennison undertook restructuring efforts, incurring charges of $25.6 million related to the reduction of approximately 1,100 positions, primarily aimed at optimizing operations in Europe. The restructuring plan is expected to be substantially completed by mid-2025.

In terms of strategic developments, the company repaid $300 million of senior notes in August 2024 and entered into a new credit agreement for a revolving credit facility of up to $1.20 billion, maturing in June 2029. As of September 28, 2024, total current assets were $3,084.7 million, up from $2,796.0 million at the end of 2023, while total current liabilities increased to $3,349.0 million from $2,699.5 million.

Overall, Avery Dennison's financial results reflect a robust performance driven by strategic initiatives and operational efficiencies, despite challenges such as increased employee-related costs and a higher provision for income taxes.