Brambles Maintains Annual Sales and Profit Guidance

Brambles, the pallet supplier, has announced that it is on track to meet its annual sales and profit targets, thanks to price increases and reduced lumber costs. In the first quarter of its fiscal year, the company reported revenue of $1.64 billion, a 15% increase from the previous year. After considering currency fluctuations, this growth stands at 13%.

Despite flat volumes in key markets, Brambles remains confident in its full-year outlook. The Australian-listed company expects sales revenue to grow by 6%-8% and underlying profit to grow by 9%-12%, on a constant currency basis.

CEO Graham Chipchase attributes the revenue performance to both price increases and contributions from previous pricing initiatives. While volumes in major markets have remained subdued, pricing on current-year contractual renewals continues to rise.

In terms of regional performance, Brambles saw strong growth in its CHEP Americas business. Revenue from this segment rose to $907.7 million, a 12% increase in constant-currency terms. The growth was driven by volume increases in Canada and Latin America, although volumes in the US were lower. The softening of consumer demand was partially offset by higher beverage and dairy sector volumes.

Despite facing overall inflationary pressures, particularly in labor costs, Brambles experienced a moderation in US transport costs and group lumber prices.

Prices in the Americas were 12% higher than the previous year, while Europe, the Middle East, and Africa saw a 15% increase. In contrast, prices in the Asia-Pacific region only rose by 5%.

Overall, revenue in Europe, the Middle East, and Africa increased by 20% to $599.0 million. In Asia-Pacific, where Brambles has been operating since 1958, revenue rose by 7% to $134.1 million.

Brambles continues to remain optimistic about its growth prospects, despite the challenging market conditions. With its steady performance and strategic initiatives, the company is well-positioned for future success.