Berry Global Group, Inc. recently reported its second fiscal quarter 2021 results, including a 13% increase in net sales, to $3.4 billion, compared to the 2020 second fiscal quarter. The net sales growth is primarily attributed to increased selling prices of $192 million due to the pass through of higher resin costs, organic volume growth of 5%, and a $92 million favorable impact from foreign currency changes.
These increases were partially offset by prior quarter divestiture sales of $53 million. The organic volume growth was primarily due to organic growth investments, modest recovery of certain markets that had previously been facing COVID-19 headwinds, and higher demand in the company's advantaged health and hygiene products as the result of COVID-19.
"The Company's performance in our second fiscal quarter was solid as adjusted earnings per share and revenue grew by 34 percent and 13 percent, respectively, from prior year results," said Tom Salmon, chairman and CEO. "Consumer demand for our products remains robust and certain markets, which previously experienced COVID-19 headwinds, are rebounding nicely. All segments delivered volume growth, collectively finishing the quarter with 5 percent organic volume growth, while operating EBITDA increased 9 percent in the quarter.
"The organically driven outperformance in this second fiscal quarter gives us confidence to raise our fiscal year 2021 outlook for operating EBITDA by $50 million from the mid-point of our previous range. Our businesses, across the globe, are clearly capitalizing on our strategy to drive profitable and sustainable organic volume growth. The continued positive momentum from our investments in areas such as health and wellness, e-commerce, and food safety along with the focus on growing our emerging market exposure and driving more sustainable packaging, provide us the path to realize long-term consistent volume growth.
"We have a clear line-of-site to being within our leverage range by the end of fiscal 2021. As we stated last quarter, once within our targeted leverage range of 3.0 to 3.9 times, we believe our consistent and growing cash flow will provide substantial capacity to create shareholder value with a capital allocation approach that includes: reinvesting in the business to support continued organic growth, further debt reductions, pursuing bolt-on acquisitions, and returning capital to shareholders while staying within our committed range."
Given its continued strength through the first half of the year and stable demand outlook across its business, Berry has increasing its organic volume growth assumption for fiscal 2021 to 5%. This includes low-single-digit growth in the back half of this fiscal year, building on last year's strong performance, and all supported by a robust and growing pipeline, increased level of capital expenditures, and the positive trends and momentum the company is seeing in each of its businesses.
Learn more about Berry Global Group and its financial results at www.berryglobal.com.
Report Abusive Comment