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Highlights:

• FY24 Reported EPS of $8.73

  • FY24 Adjusted EPS of $9.43, up 19%

• FY24 Net sales of $8.8 billion, up 4.7%

  • Sales change ex. currency up 5.1%

  • Organic sales change up 4.5%

• 4Q24 Reported EPS of $2.16

  • 4Q24 Adjusted EPS (non-GAAP) of $2.38, up 10%

• 4Q24 Net sales of $2.2 billion, up 3.6%

  • Sales change ex. currency (non-GAAP) up 3.5%

  • Organic sales change (non-GAAP) up 3.3%

• FY25 Reported EPS guidance of $9.55 to $9.95

  • Adjusted EPS guidance of $9.80 to $10.20

MENTOR, Ohio, January 30, 2025 ¨C ɳ°Í×ãÇò Corporation (NYSE:AVY) today announced preliminary, unaudited results for its fourth quarter and full year ended December 28, 2024. Non-GAAP financial measures referenced in this release are reconciled from GAAP in the attached financial schedules. Unless otherwise indicated, comparisons are to the same period in the prior year.

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¡°We delivered strong results in 2024, achieving nineteen percent earnings growth,¡± said Deon Stander, president and CEO. ¡°Both our Materials and Solutions Groups delivered strong top-and bottom-line results, with our industries recovering from downstream inventory destocking last year, once again demonstrating the strength of our overall franchise.?

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¡°We remain well-positioned to continue our long track record of strong earnings growth in 2025, including accelerating growth in our high-value categories, which now account for almost half of our portfolio,¡± added Stander. ¡°We are confident that the consistent execution of our strategies will enable us to meet our long-term goals for superior value creation in a range of geopolitical and macro scenarios.?

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¡°Once again, I want to thank our entire team for their continued resilience, focus on excellence and commitment to addressing the challenges at hand.¡±

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Fourth Quarter 2024 Results by Segment

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Materials Group

• Reported sales increased 4% to $1.5 billion. Sales were up 4% ex. currency and on an organic basis.

  • High-value categories up high single digits; base up low single digits organically

  • Label Materials up low single digits organically

  • Graphics and Reflectives up low single digits; Performance Tapes and Medical sales comparable to the prior year

• Reported operating margin was 14.7%.

  • Adjusted Operating margin (non-GAAP) of 14.8%, up 80 basis points

  • Adjusted EBITDA margin (non-GAAP) was 17.0%, up 80 basis points, driven by benefits from higher volume/mix and productivity, partially offset by the net impact of pricing and raw material input costs.

Solutions Group

• Reported sales increased 3% to $714 million. Sales were up 3% ex. currency and on an organic basis.

  • Sales in high-value categories were down mid-single digits ex. currency, as strong growth in IL apparel and general retail was more than offset by IL logistics and other high-value solutions.?

    • In Vestcom, signed a new agreement with a leading U.S. health solutions company for pricing productivity solutions.

  • Sales were up mid teens ex. currency in base solutions.

• Reported operating margin was 9.1%.?

  • Adjusted Operating margin of 11.4%, down 20 basis points

  • Adjusted EBITDA margin was 17.8%, down 40 basis points compared to prior year as benefits from productivity and higher volume were more than offset by higher employee-related costs and growth investments.

Other

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Balance Sheet and Capital Deployment

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In November, the company issued €500 million of 3.75% senior notes due 2034. The company intends to use the net proceeds from the issuance to repay in full its €500 million 1.250% senior notes due on March 3, 2025 and for general corporate purposes.

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During the fourth quarter, the company returned $210 million in cash to shareholders through a combination of dividends and share repurchases. The company repurchased 0.7 million shares at an aggregate cost of $140 million.

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During 2024, the company returned $525 million in cash to shareholders through a combination of dividends and share repurchases. The company repurchased 1.2 million shares at an aggregate cost of $248 million.? Net of dilution from long-term incentive awards, the company¡¯s share count was down 0.9 million compared to the same time last year.

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The company continues to deploy capital in a disciplined manner, executing its long-term capital allocation strategy. The company¡¯s balance sheet remains strong and its net debt to adjusted EBITDA ratio (non-GAAP) was 2.0x at the end of the fourth quarter.

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Income Taxes

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The company¡¯s reported effective tax rate was 27.9% in the fourth quarter and 26.1% for the full year. The adjusted tax rate (non-GAAP) was 25.7% in the fourth quarter and 25.9% for the full year.

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Cost Reduction Actions

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During 2024, the company realized approximately $63 million in pre-tax savings from restructuring, net of transition costs, and incurred approximately $42 million in pre-tax restructuring charges.

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Guidance

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In its supplemental presentation materials, ¡°Fourth Quarter and Full Year 2024 Financial Review and Analysis,¡± the company provides a list of factors that it believes will contribute to its 2025 financial results. Based on the factors listed and other assumptions, the company expects 2025 reported earnings per share of $9.55 to $9.95.

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Excluding an estimated $0.25 per share impact of restructuring charges and other items, the company expects 2025 adjusted earnings per share of $9.80 to $10.20.

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For more details on the company¡¯s results, see the summary tables accompanying this news release, as well as the supplemental presentation materials, ¡°Fourth Quarter and Full Year 2024 Financial Review and Analysis,¡± posted on the company¡¯s website at www.investors.averydennison.com, and furnished to the SEC on Form 8-K.

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Throughout this release and the supplemental presentation materials, amounts on a per share basis reflect fully diluted shares outstanding.

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