Amcor plc

Merger with Berry Global Group, Inc.

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 for purchase consideration of $10.4 billion, not including Berry debt assumed by Amcor of approximately $5.2 billion. 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 and cash settled 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, "Acquisitions and Disposals", for further information.

Berry Plan

In connection with the Merger with Berry, the Company initiated restructuring and integration activities in the fourth quarter of fiscal year 2025 ("Berry Plan") aimed at integrating the combined organization. The Company continues to target realizing approximately $530 million of pre-tax synergies driven by procurement, supply chain, and general and administrative savings, $60 million in annual financial synergies and $60 million in pre-tax earnings benefits from growth synergies by the end of fiscal year 2028. The total Berry Plan pre-tax cash cost is estimated at $280 million, net, including restructuring activities and general integration expenses. As of December 31, 2025, the Company has initiated restructuring projects with an expected net cost of approximately $285 million, of which $132 million relates to employee related expenses, $46 million to fixed asset related expenses (net of expected gains on asset disposals), $58 million to other restructuring expenses, and $49 million to restructuring related expenses. In addition, the Company expects to spend approximately $110 million on general integration costs. The restructuring and general integration activities initiated to date are expected to result in $260 million of net cash expenditures. The Berry Plan is expected to be completed by the end of fiscal year 2028.

In the six months ended December 31, 2025, the Company incurred $96 million in employee related expenses, $8 million in other restructuring, and $26 million in restructuring related expenses, partially offset by a net gain of $6 million on fixed asset related items, with $69 million incurred in the Global Flexible Packaging Solutions reportable segment, $47 million incurred in the Global Rigid Packaging Solutions reportable segment, and $8 million incurred in Corporate. The Company also incurred $30 million in integration activities in the first half of fiscal year 2026. Net cash outflows for restructuring and related expenses for both the three months ended and six months ended December 30, 2025, were approximately $32 million. Net cash expenditures of approximately $150 million to $160 million are expected for the balance of fiscal year 2026 for restructuring and general integration activities, with $120 million to $130 million representing payments for restructuring and related expenses.

Review of Portfolio-Related Strategic Alternatives

In August 2025, we announced that we are reviewing strategic alternatives to maximize the value of our portfolio and have identified businesses with combined sales of $2.5 billion, which includes our North American Beverage business, for further review given they are less aligned with one or more core portfolio attributes including attractive growth and margin profile, industry structure, and scale and leadership position. Possible actions for these businesses include and are not limited to restructuring, partnership and joint venture ownership models, cash sale or a combination thereof. While we continue to progress in our strategic alternatives review and expect to make progress in fiscal year 2026 on actions related to this strategic review, we have not identified a set deadline or definitive timetable for completion of the strategic alternatives review process and related actions and there is no assurance that this review will result in any transaction or that any such outcome will be successful. Subsequent to the end of the second quarter of fiscal year 2026, we completed the sale of our investment in ePac for estimated proceeds of $79 million, including contingent consideration. Refer to Note 17 - "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 the first half of fiscal year 2026. The underlying causes for the market volatility being experienced can be attributed to a variety of factors, such as geopolitical tension and conflicts, volatility and changes in U.S. domestic and global tariff frameworks and inflation in many economies impacting consumption and consumer demand. Rapid changes in U.S. trade policies, including the announcement of wide-spread tariff increases which were paused and then re-announced, amid persistent inflation in the U.S., has impacted global market conditions resulting in fluctuating consumer demand across many categories.

While we generally source and manufacture our products in the local markets where they are sold, the volatility in tariffs may continue to 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.

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. The impact of highly inflationary accounting in the three months ended December 31, 2025, and 2024 resulted in a negative impact on monetary assets of $4 million and $3 million, respectively, and $15 million and $5 million in the six months ended December 31, 2025, and 2024, respectively, in foreign currency transaction losses that were reflected in the unaudited condensed consolidated statements of income. In December 2025, the Argentine central bank announced a new phase of its economic program which included changing its foreign exchange rate band mechanism and launching an active foreign exchange reserve accumulation program to strengthen the country's economy. In December 2025, the Argentine central bank repaid the portion that it drew on the $20 billion exchange-rate stabilization agreement it entered into with the United States Treasury Department. We continue to monitor the foreign currency exposure risk of our operations in Argentina, which represented less than 1% of total assets as of December 31, 2025.