Overview of Pact Group Holdings trading update

Pact Group Holdings Ltd (ASX: $PGH) has released a trading update for the first 10 months of the 2024 financial year, reporting unaudited revenue slightly below the prior corresponding period. However, the unaudited Underlying EBITDA and unaudited Underlying EBIT were above the prior corresponding period after adjusting for Discontinued Operations. The company divested 50% of its Crate Pooling and Crate Manufacturing business during FY24 and implemented a cost savings program to reduce costs by $20 million per annum, which remains on track.

Executive commentary on trading update

The trading update for the first 10 months of the 2024 financial year demonstrates our commitment to managing the business effectively. We are pleased to report that our unaudited Underlying EBITDA and EBIT have exceeded the prior corresponding period, reflecting the success of our cost savings program and the impact of the divestment of part of our business. We are also taking proactive measures to mitigate the impact of the voluntary administration of one of our resin suppliers, Qenos, by securing resin contingencies from overseas suppliers.

Summary of Pact Group Holdings trading update

Pact Group Holdings Ltd (ASX: $PGH) has provided a trading update for the first 10 months of the 2024 financial year, indicating that the company's unaudited Underlying EBITDA and EBIT have surpassed the prior corresponding period. The divestment of part of its business and the successful implementation of a cost savings program have contributed to this positive performance. However, the company is facing challenges due to the voluntary administration of one of its resin suppliers, Qenos, and is working to secure resin contingencies from overseas suppliers. Despite this, the company remains on track to deliver FY24 Reported Underlying EBIT in line with consensus, although it now expects Gearing of approximately 2.8x at 30 June 2024, slightly higher than the previously stated target of 2.5x.