Avery Dennison (AVY) investor relations material

Strategic positioning and business overview

• Recognized as a global leader in materials science and digital identification, operating in over 50 countries with approximately 35,000 employees.

• Focuses on branding and information solutions that enhance supply chain efficiency, sustainability, and brand-consumer connectivity.

• Portfolio spans diverse end markets, with about 60% of sales anchored in consumer staples and 30% from emerging markets.

• High-value categories now represent ~45% of sales, up from 33% in 2019, driven by organic growth and acquisitions.

• Maintains a strong balance sheet and disciplined capital allocation, targeting a net debt to adjusted EBITDA ratio of 2-3x.

Financial performance and targets

• Achieved 6% sales growth ex. currency and 7.3% adjusted EBITDA growth (ex. currency) for 2023-2025; adjusted EBITDA margin reached 16.4% in 2025.

• Long-term framework targets 5%+ sales growth ex. currency, 17%+ adjusted EBITDA margin, and 10% adjusted EPS growth through 2028.

• Q2 2026 delivered 8% organic sales growth, 19% adjusted EPS growth, and a 17.1% adjusted EBITDA margin.

• Returned $347 million to shareholders YTD 2026 via share repurchases and dividends; robust adjusted free cash flow of $365 million in Q2.

• FY 2026 adjusted EPS guidance is $10.00–$10.30, with 3–4% organic sales growth expected.

Segment performance and growth drivers

• Materials Group reported $6.1 billion in 2025 sales, with a 3.2% five-year CAGR and 17.4% adjusted EBITDA margin; high-value categories comprise 38% of sales.

• Solutions Group posted $2.8 billion in 2025 sales, 12.7% five-year CAGR, and 17.3% adjusted EBITDA margin; high-value categories account for 60% of sales.

• Intelligent Labels segment targets 15%+ long-term organic sales growth, with apparel and general retail leading adoption.

• Embelex and Vestcom platforms drive growth through customization, personalization, and productivity solutions for brands and retailers.

• High-value categories have outperformed global GDP and retail volumes, expanding the company’s growth and margin profile.