Brambles Maintains Annual Guidance as 1Q Revenue Jumps on Price Rises

By Stuart Condie

SYDNEY--Pallet supplier Brambles maintained its annual sales and profit guidance after price rises and easing lumber costs helped offset flat volumes in its fiscal first quarter.

Brambles on Thursday said reported September quarter revenue of $1.64 billion on a continuing operations basis, up 15% on-year, or 13% once currency moves are stripped out.

The Australia-listed company, which reports in U.S. dollars, still expects full-year sales revenue to grow by 6%-8% and underlying profit to grow by 9%-12%, on a constant currency basis.

"While pricing on current-year contractual renewals continued to increase, this revenue performance predominantly reflected rollover contributions from prior-year pricing initiatives as volumes in our largest markets remained subdued," Chief Executive Graham Chipchase said.

First-quarter revenue from its CHEP Americas business jumped to $907.7 million from $747.9 million, or by 12% in constant-currency terms. Volume growth in Canada and Latin America offset lower volumes in the U.S., where Brambles saw softer underlying consumer demand partially offset by increased beverage and dairy sector volumes.

"While broader inflationary pressures, including labor, have increased our input costs in aggregate, we have continued to see a moderation in U.S. transport costs and group lumber prices," Chipchase said.

Americas prices were 12% higher than a year earlier following increases pushed through in fiscal 2023. Europe, Middle East and Africa prices were up 15%, while Asia-Pacific prices rose just 5%.

Europe, Middle East and Africa revenue rose 20%, to $599.0 million, or by 14% in constant currency. Revenue in Asia-Pacific, where Brambles first began operating a pallets business in 1958, rose 7%, to $134.1 million, or by 13% in constant currency.

Write to Stuart Condie at [e-mail]

(END) Dow Jones Newswires

October 25, 2023 18:38 ET (22:38 GMT)

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