The Orora Ltd (ASX: ORA) share price is in focus following a trading update, with the company revising down FY26 EBIT guidance for its Saverglass division due to the ongoing Middle East conflict. Saverglass’ underlying FY26 EBIT (â¬) is now forecast at â¬63â68 million, compared to previous guidance of around â¬79.2 million.
What did Orora report?
- FY26 Saverglass underlying EBIT (â¬) expected at â¬63mââ¬68m (down from â¬79.2m in FY25)
- FY26 reported EBIT (â¬) for Saverglass now forecast at â¬52mââ¬59m
- Direct 2H26 EBIT impact from Middle East conflict: â¬9mââ¬11m
- Indirect 2H26 EBIT impact due to weaker volumes and negative mix: â¬11mââ¬16m
- No change to existing FY26 guidance for Cans or Gawler divisions
- Leverage ratio expected to remain below 1.5x at June 2026
What else do investors need to know?
The Ras al Khaimah (RAK) facility in the UAE is safe and undamaged, but production has shifted to a closed-loop ‘hot’ mode due to shipping and overland route closures. Orora assures all team members are accounted for and safety is the top priority.
Production from the RAK facility, representing about 15% of Saverglass capacity, will be shifted to Mexico for the North American market, with bottle moulds transported to the Acatlán facility. Orora has paused its on-market buyback while monitoring the conflict’s ongoing impacts.
What’s next for Orora?
Orora continues to monitor the Middle East situation and remains committed to safety and operational continuity. Shifting production from the RAK facility to Mexico is expected to help maintain supply for key customers, with mitigation strategies aiming to reduce energy cost pressures.
The company retains a strong balance sheet and expects leverage to stay below 1.5x by the financial year-end. The paused buyback may resume once there is greater certainty around external risks.
Orora share price snapshot
Over the past 12 months, the Orora share price has risen 16%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 21% over the same period.
The post Orora updates FY26 outlook as Saverglass earnings take a hit appeared first on The Motley Fool Australia.
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Motley Fool contributor Laura Stewart has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Orora. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.