Avery Dennison(AVY) - 2024 Q4 - Annual Results

Financial Performance - FY24 reported EPS was $8.73, with adjusted EPS of$ 9.43, reflecting a 19% increase year-over-year [5]. - FY24 net sales reached $8.8 billion, up 4.7%, with organic sales growth of 4.5% [5]. - 4Q24 reported EPS was$ 2.16, while adjusted EPS was $2.38, marking a 10% increase compared to the previous year [5]. - 4Q24 net sales totaled$ 2.2 billion, up 3.6%, with organic sales growth of 3.3% [5]. - Total net sales for 2024 reached $8,755.7 million, a 4.7% increase compared to$ 8,364.3 million in 2023 [26]. - Reported net income for 2024 was $704.9 million, a 40% increase from$ 503.0 million in 2023, resulting in net income per share of $8.73, up 41% [26][28]. - Adjusted net income for 2024 was$ 760.9 million, a 19% increase from $640.9 million in 2023, with adjusted net income per share of$ 9.43, up 19% [26][28]. Sales and Revenue Growth - The Materials Group reported sales of $1.5 billion in 4Q24, a 4% increase, with an adjusted operating margin of 14.8% [8]. - The Solutions Group reported sales of$ 714 million in 4Q24, a 3% increase, with an adjusted operating margin of 11.4% [8]. - The Materials Group generated net sales of $6,013.0 million, reflecting a 3.5% increase year-over-year, while the Solutions Group saw a 7.4% increase to$ 2,742.7 million [26]. - Net sales for the three months ended December 28, 2024, were $2,185.7 million, an increase from$ 2,110.5 million for the same period in 2023, representing a growth of 3.5% [60]. - Organic sales change for the total company was 4.5% for the full year 2024, with the Materials Group at 3.7% and the Solutions Group at 6.1% [69]. Guidance and Future Expectations - The company expects FY25 reported EPS guidance of $9.55 to$ 9.95, and adjusted EPS guidance of $9.80 to$ 10.20 [15]. Cash Flow and Shareholder Returns - The company returned $525 million to shareholders in 2024 through dividends and share repurchases, including$ 210 million in 4Q24 [11]. - The company reported adjusted free cash flow of $699.5 million for 2024, compared to$ 591.9 million in 2023 [26]. - Adjusted free cash flow for the three months ended December 28, 2024, was $279.5 million, compared to$ 218.3 million for the same period in 2023, marking an increase of 28.0% [57]. Operating Income and Margins - Adjusted operating income for 2024 was $1,122.1 million, up 16% from$ 963.8 million in 2023, with adjusted operating margins increasing to 12.8% from 11.5% [26]. - Adjusted operating income for the twelve months ended December 28, 2024, was $1,122.1 million, compared to$ 963.8 million for the twelve months ended December 30, 2023, reflecting a year-over-year increase of 16.5% [53]. - Reported operating income for the Materials Group increased to $217.0 million in Q4 2024, up from$ 170.1 million in Q4 2023, representing a growth of 27.5% [62]. - Adjusted operating income for the Solutions Group was $81.2 million in Q4 2024, slightly up from$ 80.5 million in Q4 2023, indicating a growth of 0.9% [62]. Debt and Financial Position - The net debt to adjusted EBITDA ratio was 2.0x at the end of 4Q24, indicating a strong balance sheet [12]. - The company's net debt stood at $2,823.1 million, with a net debt to adjusted EBITDA ratio of 2.0 as of Q4 2024 [65]. - The company reported a total debt of$ 3,152.2 million, with cash and cash equivalents of $329.1 million [65]. - Cash and cash equivalents increased to$ 329.1 million at the end of 2024, compared to $215.0 million at the end of 2023 [34]. - Total assets grew to$ 8,405.1 million in 2024, up from $8,209.8 million in 2023 [32]. - The company’s total current liabilities increased to$ 2,862.6 million in 2024, compared to $2,699.5 million in 2023 [32]. Efficiency and Profitability - Adjusted EBITDA for the year was$ 1,434.3 million, a 14% increase from $1,262.2 million in 2023, with adjusted EBITDA margins rising to 16.4% [26]. - Adjusted EBITDA for the twelve months ended December 28, 2024, reached$ 1,434.3 million, up from $1,262.2 million in the previous year, indicating a growth of 13.6% [53]. - The adjusted operating margin for the three months ended December 28, 2024, was 12.8%, compared to 12.4% for the same period in 2023, showing an improvement of 0.4 percentage points [53]. - The company reported an adjusted EBITDA margin of 16.4% for the three months ended December 28, 2024, compared to 16.0% for the same period in 2023, reflecting a 0.4 percentage point increase [53]. - The income before taxes as a percentage of net sales for the three months ended December 28, 2024, was 11.0%, up from 9.6% for the same period in 2023, indicating a significant improvement in profitability [53]. Currency Impact - The company experienced a foreign currency translation impact of (0.1%) on reported net sales change in Q4 2024 [68].