Amcor plc

Completion of Berry Global Group, Inc. Merger on April 30, 2025

On November 19, 2024, the Company, Aurora Spirit, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”), and Berry Global Group, Inc., a Delaware corporation (“Berry”), entered into an Agreement and Plan of Merger (the “Merger Agreement”). The Merger Agreement provides for the merger of Merger Sub with and into Berry (the “Merger”), with Berry surviving the Merger as a wholly-owned subsidiary of Amcor. On April 30, 2025, we completed the transactions called for by the Merger Agreement to obtain all of the ownership interest in Berry. In connection with the closing of the Merger, we issued approximately 846 million ordinary shares to Berry shareholders, excluding shares for Berry vested share based payment awards at closing, and paid $2.2 billion in connection with the required extinguishment of certain Berry indebtedness using the proceeds from the cumulative issuance of $2.2 billion in long-term debt in March 2025. Refer to Part 1, Item 1 - Financial Statements, Note 3, "Merger with Berry Global Group, Inc.", Note 12, "Debt", and Note 18, "Subsequent Events" for further information.

Economic and Market Conditions

Market dynamics remain challenging with softer consumer demand and customer order volatility in certain markets, and higher costs in certain areas, including labor costs, during fiscal year 2025. Despite these hurdles, we have benefited from overall sales volume growth of 1% through the first nine months of fiscal year 2025, with sales volumes in North America generally softening sequentially in the third quarter of fiscal year 2025. The underlying causes for the market volatility being experienced can be attributed to a variety of factors, such as geopolitical tension and conflicts, changes in U.S. domestic and global tariff frameworks, inflation in many economies impacting consumption and consumer demand, and customer destocking following a period of supply chain constraints. While we generally manufacture our products in the local markets where they are sold, the volatility in tariffs may negatively impact customer and consumer demand, disrupt our supply chains, and increase inflation, raising our costs. In this context, we have remained focused on taking price and cost actions to offset inflation and aligning our cost base with market dynamics and expect to continue to do so. There is no assurance that we will meet our performance expectations or that ongoing geopolitical tensions, including disruptions related to tariffs and other factors, will not negatively impact our financial results.

Russia-Ukraine Conflict / 2023 Restructuring Plan

On February 7, 2023, we announced that we expect to invest $110 million to $130 million of the sale proceeds from our Russian business sold in December 2022 for net cash proceeds of $365 million in various cost savings initiatives to partly offset divested earnings from the Russian business (the "2023 Restructuring Plan" or the "Plan").

As of March 31, 2025, we have initiated restructuring and related projects with an expected net cost of approximately $220 million, of which approximately $130 million is expected to result in net cash expenditures. From the initiation of the Plan until March 31, 2025, we have incurred $99 million in employee-related expenses, $34 million in fixed asset related expenses, $54 million in other restructuring, and $26 million in restructuring related expenses. The Plan has resulted in $106 million of cumulative net cash outflows to date. The Plan has been largely completed as of December 31, 2024. Management expects to realize an annualized pre-tax benefit of approximately $50 million from structural cost reduction actions taken as a result of all Russia related restructuring by the end of fiscal year 2025.

For further information, refer to Note 6, "Restructuring," of Part I, "Item 1, Notes to Condensed Consolidated Financial Statements".

Highly Inflationary Accounting

We have subsidiaries in Argentina that historically had a functional currency of the Argentine Peso. As of June 30, 2018, the Argentine economy was designated as highly inflationary for accounting purposes. Accordingly, beginning July 1, 2018, we began reporting the financial results of our Argentine subsidiaries with a functional currency of the Argentine Peso at the functional currency of the parent, which is the U.S. dollar. Following the governmental election in the second quarter of fiscal year 2024, Argentina devalued the Argentine Peso by approximately 55% against the U.S. dollar. In April 2025, the Argentine government lifted its capital controls over the Argentine peso and implemented a currency band within which the government will allow the Argentine peso to trade against the U.S. dollar and will enable the Central Bank of Argentina to increase its reserves. As of the date of this filing, the Argentine peso is trading within the currency band established by the government and the country has received additional funding from the International Monetary Fund. The impact of highly inflationary accounting in the three months ended March 31, 2025 and 2024 resulted in a negative impact on monetary assets of $3 million and $4 million, respectively, and $8 million and $55 million in the nine months ended March 31, 2025 and 2024, respectively, in foreign currency transaction losses that were reflected in the unaudited condensed consolidated statements of income.