Shareholders must have cheered to see the Pact Group Holdings Ltd (ASX: PGH) share price rise 3.7% to $3.58 today after a period of declines since early August.
The manufacturer of packaging products shares slumped after the release of its FY18 results which revealed a statutory NPAT drop of 18% from FY17.
The Pact Group share price has dropped 37% over the last 12 months, but part of its profit dip can be attributed to expenses totalling around $23 million – due primarily to a higher earn-out for its Pascoe's acquisition, transaction costs for its Asian acquisition and restructuring costs.
Pact Group has forecast EBITDA growth to between $270 million and $280 million for FY19 and if raw materials costs are more manageable, should be able to improve on its margins.
Packaging is an interesting niche, with Orora Ltd (ASX: ORA) and Amcor Limited (ASX: AMC) also worth a look in the space.
