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  "documentTitle": "Amcor plc (pro forma Amcor-Berry Global combination) (AMCR)",
  "authorId": "54_Spruce_Point_Capital",
  "authorName": "Ben Axler",
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  "sourceTypeLabel": "Short seller",
  "presentationDate": "2020-03-10 00:00:00",
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  "notes": "The slide uses a red box to highlight the 'Organic' Amcor LTM Dec 2019 column, emphasizing the shortfall.",
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      "text": "We believe this underinvestment points to material organic decline in legacy Amcor.",
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      "text": "1) Q1 and Q3 Bemis sales reported as $1,001.4 and $970m. We double this combined result to estimate full year sales. Capex guidance per Bemis CEO on Jan 31, 2019 detailed earlier and up to $185m per year as noted in the projections of the proxy statement (p. 105)\n2) Supplemental disclosure (p.5) shows $284.1m of sales from divested EC and US assets, which we remove 53% to account for mid year deal closing. We assume divested assets contributed capital expenditures consistent with 4% of sales. Bemis deal closed June 11, 2019 so we remove 56% of estimated sales and capex contribution",
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      "kind": "metric",
      "text": "Capex as % of Sales: 2.9%-3.2%",
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      "text": "Amcor stated pre-Bemis closing that $400m of capex is necessary to support organic growth. By adjusting its LTM 2019 results for the contribution of Bemis and divestment of U.S. and European assets, we estimate legacy Amcor capex is running at $258 - $277m, or approximately 30%-35% below plan. We believe this underinvestment points to material organic decline in legacy Amcor.",
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      "kind": "quote",
      "text": "2. Capital Expenditures - Typically about USD 400 million each year, to organically maintain and grow the business, and expand earnings. — Amcor FY 2018 Annual Report",
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      "kind": "source-note",
      "text": "Source: Company financials and Spruce Point analysis",
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      "text": "Table comparing Amcor and Bemis standalone financials, pro-forma adjustments, and the resulting organic Amcor figures.",
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      "kind": "title",
      "text": "Capex Shortfall Signals Organic Decline In Its Underlying Business",
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