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Avery Dennison Corp. Reports Operating Results (10-Q)

August 07, 2012 | About:
10qk

10qk

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Avery Dennison Corp. (AVY) filed Quarterly Report for the period ended 2012-06-30.

Avery Dennison Corporation has a market cap of $3.23 billion; its shares were traded at around $31.24 with a P/E ratio of 16.6 and P/S ratio of 0.5. The dividend yield of Avery Dennison Corporation stocks is 3.5%. Avery Dennison Corporation had an annual average earning growth of 2% over the past 10 years.

Highlight of Business Operations:

Net sales from the Companys continuing operations to the OCP business were $19.2 million and $41.2 million for the three and six months ended June 30, 2012, respectively, and $22 million and $44.5 million for the three and six months ended July 2, 2011, respectively. These sales have been included in Net sales in the unaudited Consolidated Statements of Income.

In December 2011, we signed a definitive agreement to sell our Office and Consumer Products (OCP) business to 3M Company (3M) for gross cash proceeds of $550 million, subject to adjustment in accordance with the terms of the agreement. The transaction is subject to customary closing conditions and regulatory approvals, and is expected to close in the second half of 2012. We intend to use the net proceeds from the sale for short-term borrowings repayment, pension contributions, and share repurchases. We have classified the operating results of this business, together with certain costs associated with the divestiture transaction, as discontinued operations in the unaudited Consolidated Statements of Income for the three and six months ended June 30, 2012 and July 2, 2011. Assets and liabilities of this business are classified as held for sale in the unaudited Condensed Consolidated Balance Sheets at June 30, 2012 and December 31, 2011. The discontinued operations, which comprised substantially all of our previously reported OCP segment, had sales of approximately $179 million and $336 million for the first three and six months ended June 30, 2012, respectively, and approximately $203 million and $358 million for the first three and six months ended July 2, 2011, respectively. The operating results of the retained portion of the previously reported OCP segment, which are not significant, are included in our other specialty converting businesses for all periods presented.

Sales in the second quarter of 2012 declined approximately 1% compared to the same period last year, as higher sales on an organic basis were more than offset by the unfavorable impact of foreign currency translation. On an organic basis, sales grew 4% driven primarily by increased demand in the Pressure-sensitive Materials segment and our other specialty converting businesses.

Sales in our other specialty converting businesses decreased 5% in the second quarter of 2012 compared to the same period last year, reflecting the impact of a product line divestiture in the fourth quarter of 2011 and the unfavorable impact of foreign currency translation, partially offset by higher sales on an organic basis. On an organic basis, sales grew 2% as a result of increased volume.

Sales in our other specialty converting businesses decreased 5% in the first six months of 2012 compared to the same period last year, reflecting the impact of a product line divestiture in the fourth quarter of 2011 and the unfavorable impact of foreign currency translation, partially offset by higher sales on an organic basis. On an organic basis, sales grew 1% primarily as a result of higher volume.

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