Growth Outlook More Challenged for Brambles in Fiscal 2022, but Long-Term Secular Thesis Intact

Following a fiscal 2021 characterised by coronavirus-heightened pallet demand, we expect earnings growth to be more elusive for wide-moat Brambles in fiscal 2022. Pallet demand maintained at robust levels into the final quarter of fiscal 2021, contributing to a healthy 8% increase in full-year operating income. With net new business wins in the Americas segment evading Brambles in late fiscal 2021, the result was modestly short of our expectations for 9% EBIT growth year on year. Nonetheless, the strong result bettered Brambles’ full-year EBIT growth guidance range of 5%-7%.