CCL Industries Inc.

For Q2 2025, sales were $1.9 billion, up 4.8% year over year, driven by 2% organic growth, 1% acquisition-related growth, and 1.8% foreign currency tailwind. Operating income was $322.1 million versus $303.5 million last year, and consolidated EBITDA increased 6% excluding currency effects. Adjusted basic EPS was $1.22, up 8%, while basic EPS was $1.21 versus $1.56 in Q2 2024; prior-year net earnings included a $78.1 million revaluation gain. Free cash flow from operations was $226 million versus $118.8 million a year ago, and trailing 12-month free cash flow was $759.8 million. Management did not give full-year revenue or EPS guidance, but said 2025 capex should be around $485 million, CCL segment orders were stable year over year, Avery should improve sequentially, Checkpoint ALS should pick up into the busy fall season, Innovia should still post gains, and FX should be a modest tailwind or neutral.

Geoff Martin’s tone was constructive but measured. He emphasized strong operating performance in CCL and HPC, better margins in CCL Design electronics, and continued momentum in the CCL and Innovia businesses, while acknowledging that tariff-driven disruption is creating real noise in Avery and RFID. He repeatedly pointed to supply-chain normalization and pricing actions as the path to recovery, but avoided overpromising on near-term recovery timing.

Sean Washchuk highlighted the quarter’s financial improvement: sales up 4.8% to $1.9 billion, operating income up to $322.1 million, adjusted EPS up 8% to $1.22, and free cash flow from operations up sharply to $226 million. Net finance expense fell to $17.3 million from $18.6 million, aided by higher cash income, while net debt was $1.63 billion at June 30, 2025, only $15 million above year-end and leverage improved to about 1.04x from 1.08x. He also noted $963 million of cash, USD 0.8 billion of undrawn revolver capacity, $100 million of buybacks in the quarter, and year-to-date dividends of $112.1 million.

Analysts focused on whether CCL’s margin strength in CCL was sustainable, how much of the RFID slowdown was tariff and supply-chain related, and whether Avery’s back-to-school season would recover the Q2 shortfall. Management said HPC was a key source of share gains, CCL Design electronics margins had improved substantially, and RFID weakness was driven by apparel customers rethinking sourcing rather than lower consumption; Geoff said RFID should return to double-digit growth once supply chains normalize. On Avery, management said July was modestly better, August replenishment remains the key risk, and they doubt they will fully recover June losses. They also said the German Innovia plant will only generate small revenues in 2H 2025, with material revenues starting in 2026.