23 January 2007 — Pasadena (CA): Avery Dennison has reported that Q4 office and consumer products sales declined 2.7 percent to $285 million.
A company spokesman said: "The previously announced divestiture of low-margin filing product lines and the decision to exit certain private label business reduced sales by approximately 6 percent."
Segment operating margin (GAAP) was 18.7 percent, compared to 16.5 percent for the same period last year. Before restructuring and asset impairment charges and other items, operating margin declined 440 basis points to 18 percent, due to changes in the year-end adjustment of LIFO inventory reserves compared to the prior year, as well as higher spending related to promotions and brand-building initiatives.
Avery’s Q4 total net income recovered to $101.5 million or EPS of $1.01, from a loss of $6.9 million or a loss per share of $0.07 last year.
The company said that group Q4 net sales increased 3.5 percent to $1.41 billion from $1.36 billion last year, organic sales grew by 2 percent during the period and that restructuring efforts achieved annualised savings of approximately $95 million.
Avery’s net income for the year was $367.2 million or EPS of $3.66 compared with $226.4 million or EPS of $2.25 in the prior year. Net sales were $5.58 billion in 2006, compared to $5.47 billion in the previous year.
Dean Scarborough, president and CEO, said: "During both the fourth quarter and the full year, we increased sales and produced solid improvement in earnings, despite sluggish demand in North America. We are well positioned for 2007."
He continued: "In addition, we are expanding capacity in emerging markets, including both China and India, where we see strong demand for our products and high potential for sustained, rapid growth."