Avery Dennison provides update on long-term Biz plans

05 Mar '08

3 min read

Avery Dennison Corporation provided an update on its long-term business priorities at a meeting of securities analysts and institutional investors in New York. Management detailed its strategy for achieving targets for improved earnings, return on total capital and cash flow.

"We have unique and strong competitive advantages in our markets," said Dean A. Scarborough, president and chief executive officer. "Innovative products and services, a global footprint, and proprietary capabilities to manage customer data create exciting opportunities to add value for customers. This value differentiates our products in the marketplace and cements our relationships with our customers."

"With the acquisition of Paxar, our Retail Information Services group became the second largest business in our portfolio," he added. "We expect this business, which consists of products and services serving retail apparel markets, to grow more than five percent over the medium-to-long term. This growth will be driven by share gain in a highly fragmented global market, driven by our industry-leading product innovation and service capabilities."

Scarborough also discussed the impact of economic conditions on the Company's businesses. "The weak business conditions we saw in the fourth quarter have generally continued," he said.

"While volume for the North American roll materials business has improved, margins will remain lower until we realize the benefit of our late first quarter price increases. We have also seen weakening in some of our more economically sensitive businesses. We now expect the first quarter to represent less than 20 percent of our earnings for the year, as the benefit of price increases and many of our cost reduction actions are weighted toward the back half of the year."

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