Sales Up 19% for Avery Dennison

Expects a tougher second half of the year

Avery Dennison reported a net sales increased of 19% to $1.68 billion for the second quarter. Net income was $83.8million.

"The company delivered a strong second quarter, with double-digit sales growth and solid margin expansion," said Dean A. Scarborough, Avery Dennison CEO. "I'm especially pleased with the improved performance of Retail Information Services, which expanded operating margin above pre-recession levels. Our core pressure-sensitive materials businesses had solid results, including double-digit sales growth in all regions, and our investments in marketing have enabled us to convert more brand owners to pressure-sensitive solutions from other labeling technologies.

"The second half of the year will be more challenging than the second quarter, which is traditionally our strongest," Scarborough said. "While we expect solid second-half revenue growth, margins will come under pressure from rising raw material costs and Office Products' investments in innovation and demand creation. At the same time, we are on track to exceed our original target for strong free cash flow.

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