Packaging and recycling group Pact Group has reported a slight fall in profit on rising revenues as it continues to invest in new packaging recycling operations and ready for further investment in its Australian packaging operations.
The company reported revenue growth for FY23 of six percent to $1.95 billion in tightening economic conditions, softer demand in Asia and weather events in Austraia and New Zealand.
Underlying EBIT was seven percent below FY22 at $145 million and was hit by increases in labour and supply chain costs.
Pact Managing Director and Group Chief Executive Officer Sanjay Dayal said: “The impact of increasing inflation is reflected in softening demand for consumer products which has impacted particularly on volumes in our packaging and sustainability segment where we produce high-quality packaging containing recycled content.
“We have experienced a change in customer buying patterns with a move towards bulk and private label buying.”
Reported net profit after tax was a loss of $7 million as a result of a non cash impairment of $37 million for property plant and equipment. The impairment is related to the expected replacement of equipment across multiple platforms in Australia.
Pact reported ‘significant progress’ in its strategy of leading in the circular economy:
Dayal said the company’s gearing remained elevated reflecting its capital programme with $125 million invested in the year, net of federal government funding through the Modern Manufacturing Initiative.
Picture: Circular Plastics Australia