{ "docId": "019dd923-622c-750b-8b98-eaae8b08698d", "docSlug": "c665ec3b53b5", "documentTitle": "Amcor plc (pro forma Amcor-Berry Global combination) (AMCR)", "authorId": "54_Spruce_Point_Capital", "authorName": "Ben Axler", "documentKindSlug": "activist-deck", "documentKindLabel": "Activist deck", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2020-03-10 00:00:00", "orientation": "landscape", "aspectRatio": 1.3333334, "pageNumber": 74, "pageCount": 95, "prevPage": 73, "nextPage": 75, "slideType": "expose_contradiction", "function": "expose_contradiction", "density": "overcrowded", "nDataPoints": 0, "notes": "Uses direct quotes from executives to highlight a contradiction in seasonal expectations.", "elementsJson": [ "headline_text", "paragraph", "callout_box", "quote_block" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b98-eaae8b08698d/74", "deckHref": "/decks/019dd923-622c-750b-8b98-eaae8b08698d", "deckJsonHref": "/decks/019dd923-622c-750b-8b98-eaae8b08698d.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b98-eaae8b08698d#slide-74", "components": [ { "bbox": { "h": 0.04, "w": 0.8, "x": 0.15, "y": 0.62 }, "kind": "callout", "text": "Amcor Operates On A June 30th Year", "attrs": null, "subkind": "primary", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "927a538b-5995-4b13-a6ab-f82e3dce0b8f", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.04, "w": 0.8, "x": 0.15, "y": 0.4 }, "kind": "callout", "text": "Bemis Operates On A Traditional Calendar December 31st Year End", "attrs": null, "subkind": "primary", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "b4a27c3d-26a8-4f04-ad4d-3ae7ddbee2ea", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "callout", "text": "Spruce Point believes that Amcor’s cash flow in the first half of calendar year 2020 (second half of its FY end June 30, 2020) will disappoint.", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd953-2b65-734e-a985-5f5a11daa7e6", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.9, "x": 0.05, "y": 0.2 }, "kind": "paragraph", "text": "Spruce Point believes that Amcor's cash flow in the first half of calendar year 2020 (second half of its FY end June 30, 2020) will disappoint. Amcor's CFO proclaimed that it has better cash flow in the second half of its year (Jan – June). Whereas, Bemis CEO is on record saying that Bemis' best cash flow is always Q3 (June – September). Therefore, we struggle to see how cash flow will improve over the next six months given that it is the weakest period for Bemis. In addition, we've also illustrated how Bemis' revenues have been declining, making it even more likely that cash flow will be pressured.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "d12ea76b-dbce-41f2-bd16-4cae15bd3194", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.1, "w": 0.8, "x": 0.15, "y": 0.45 }, "kind": "quote", "text": "On the other part of the question Q3, Q4, traditionally, seasonality, Q3 is always larger than Q4, and that's how the plan rolls out in the back half of this year. Q3 is again our seasonally highest quarter, traditionally our highest quarter, and it is higher this year as it has been in all the past years.", "attrs": null, "subkind": "testimonial", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "193f5ddd-4a7b-4756-a4e6-586636d01f58", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.1, "w": 0.8, "x": 0.15, "y": 0.67 }, "kind": "quote", "text": "Typically, our cash flow is much stronger in the second half, and we'll -- we typically have higher earnings in the second half, so there's some seasonality there. We expect there'll be some working capital improvements, as we've seen in the first half, that will continue to flow in the second. So look, generally speaking, that's the normal trend we see. And that's what we expect for the second half, more around seasonality.", "attrs": null, "subkind": "testimonial", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "c1f1dcd8-7445-4a9e-bcc0-3e08c21e29d2", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "“On the other part of the question Q3, Q4, traditionally, seasonality, Q3 is always larger than Q4, and that’s how the plan rolls out in the back half of this year. Q3 is again our seasonally highest quarter, traditionally our highest quarter, and it is higher this year as it has been in all the past years.” — CEO Bemis, Q2 2018, July 2018; “Typically, our cash flow is much stronger in the second half, and we’ll -- we typically have higher earnings in the second half, so there’s some seasonality there. We expect there’ll be some working capital improvements, as we’ve seen in the first half, that will continue to flow in the second. So look, generally speaking, that’s the normal trend we see. And that’s what we expect for the second half, more around seasonality.” — Amcor CFO, H1 Earnings, Feb 11, 2020", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd953-2b65-734e-a985-6162ace80b69", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.08, "w": 0.68, "x": 0.28, "y": 0.03 }, "kind": "title", "text": "Amcor Claims Cash Flow Will Improve In The Second Half...Not So Fast!", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "c3c61ed0-aa3a-4720-99cd-09a50af35bf6", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "expose_contradiction", "slug": null, "matchId": "a045460a-c236-4479-96c5-f9b8ba902c53", "evidence": "Contrasting executive statements to invalidate a company's forward-looking guidance.", "confidence": 0.9 } ], "arcBeats": [], "loops": [], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }