Item 8. - Financial Statements and Supplementary Data

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of Amcor plc

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Amcor plc and its subsidiaries (the “Company”) as of June 30, 2023 and 2022, and the related consolidated statements of income, comprehensive income, equity and cash flows for each of the three years in the period ended June 30, 2023, including the related notes and schedule of valuation and qualifying accounts and reserves for each of the three years in the period ended June 30, 2023 appearing under Item 15(a)(2) (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of June 30, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of June 30, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended June 30, 2023 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of June 30, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control Over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Goodwill Impairment Assessment – Flexibles Latin America Reporting Unit within the Flexibles Segment

As described in Notes 2 and 10 to the consolidated financial statements, the Company’s consolidated goodwill balance was $5,366 million as of June 30, 2023, and the goodwill associated with the Flexibles Segment was $4,391 million, which includes goodwill associated with the Flexibles Latin America reporting unit. Management conducts an impairment analysis in the fourth quarter of each year, or whenever events and circumstances indicate an impairment may have occurred during the year. Management’s quantitative assessment utilizes discounted cash flow models to determine the fair value of the reporting unit. As disclosed by management, if the carrying value of a reporting unit exceeds its fair value, management would recognize an impairment loss equal to the difference between the carrying value and estimated fair value of the reporting unit, adjusted for any tax benefits, limited to the amount of the carrying value of goodwill. Management’s projected future cash flows for the Flexibles Latin America reporting unit included key assumptions relating to revenue growth, projected operating income growth, market multiples, terminal values, and the discount rate.

The principal considerations for our determination that performing procedures relating to the goodwill impairment assessment of the Flexibles Latin America reporting unit within the Flexibles Segment is a critical audit matter are (i) the significant judgment by management when developing the fair value of the reporting unit; (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to revenue growth, projected operating income growth, terminal values and the discount rate; and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management’s goodwill impairment assessment, including controls over the valuation of the Flexibles Latin America reporting unit. These procedures also included, among others, (i) testing management’s process for developing the fair value estimate of the reporting unit; (ii) evaluating the appropriateness of the discounted cash flow models; (iii) testing the completeness and accuracy of underlying data used in the models; and (iv) evaluating the reasonableness of the significant assumptions used by management related to revenue growth, projected operating income growth, terminal values and the discount rate. Evaluating management’s assumptions related to revenue growth, projected operating income growth, terminal values and the discount rate involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the reporting unit; (ii) the consistency with external market and industry data; and (iii) whether these assumptions were consistent with evidence obtained in other areas of the audit. Professionals with specialized skill and knowledge were used to assist in the evaluation of the Company’s discounted cash flow models, terminal values, and the discount rate.

/s/ PricewaterhouseCoopers AG
Zurich, Switzerland
August 17, 2023

We have served as the Company's auditor since 2019.

Amcor plc and Subsidiaries

Consolidated Statements of Income

($ in millions, except per share data)

For the years ended June 30,						2023						2022						2021
Net sales						$	14,694					$	14,544					$	12,861
Cost of sales						(11,969)						(11,724)						(10,129)
Gross profit						2,725						2,820						2,732
Selling, general, and administrative expenses						(1,246)						(1,284)						(1,292)
Research and development expenses						(101)						(96)						(100)
Restructuring, impairment, and other related activities, net						104						(234)						(94)
Other income, net						26						33						75
Operating income						1,508						1,239						1,321
Interest income						31						24						14
Interest expense						(290)						(159)						(153)
Other non-operating income, net						2						11						11
Income before income taxes and equity in income of affiliated companies						1,251						1,115						1,193
Income tax expense						(193)						(300)						(261)
Equity in income of affiliated companies, net of tax						—						—						19
Net income						$	1,058					$	815					$	951
Net income attributable to non-controlling interests						(10)						(10)						(12)
Net income attributable to Amcor plc						$	1,048					$	805					$	939
Basic earnings per share:
Basic earnings per share						$	0.709					$	0.532					$	0.604
Diluted earnings per share						$	0.705					$	0.529					$	0.602

See accompanying notes to consolidated financial statements.

Amcor plc and Subsidiaries

Consolidated Statements of Comprehensive Income

($ in millions)

For the years ended June 30,						2023						2022						2021
Net income						$	1,058					$	815					$	951
Other comprehensive income/(loss):
Net gains/(losses) on cash flow hedges, net of tax (a)						(1)						(7)						26
Foreign currency translation adjustments, net of tax (b)						69						(201)						205
Pension, net of tax (c)						(50)						94						52
Other comprehensive income/(loss)						18						(114)						283
Total comprehensive income						1,076						701						1,234
Comprehensive income attributable to non-controlling interests						(10)						(10)						(12)
Comprehensive income attributable to Amcor plc						$	1,066					$	691					$	1,222
(a) Tax benefit related to cash flow hedges						$	1					$	2					$	—
(b) Tax benefit/(expense) related to foreign currency translation adjustments						$	(1)					$	(5)					$	7
(c) Tax benefit/(expense) related to pension adjustments						$	11					$	(21)					$	(14)

See accompanying notes to consolidated financial statements.

Amcor plc and Subsidiaries

Consolidated Balance Sheets

($ in millions, except share and per share data)

As of June 30,						2023						2022
Assets
Current assets:
Cash and cash equivalents						$	689					$	775
Trade receivables, net of allowance for credit losses of $21 and $25, respectively						1,875						1,935
Inventories, net
Raw materials and supplies						992						1,114
Work in process and finished goods						1,221						1,325
Prepaid expenses and other current assets						531						512
Assets held for sale, net						—						192
Total current assets						5,308						5,853
Non-current assets:
Property, plant, and equipment, net						3,762						3,646
Operating lease assets						533						560
Deferred tax assets						134						130
Other intangible assets, net						1,524						1,657
Goodwill						5,366						5,285
Employee benefit assets						67						89
Other non-current assets						309						206
Total non-current assets						11,695						11,573
Total assets						$	17,003					$	17,426
Liabilities
Current liabilities:
Current portion of long-term debt						$	13					$	14
Short-term debt						80						136
Trade payables						2,690						3,073
Accrued employee costs						396						471
Other current liabilities						1,297						1,344
Liabilities held for sale						—						65
Total current liabilities						4,476						5,103
Non-current liabilities:
Long-term debt, less current portion						6,653						6,340
Operating lease liabilities						463						493
Deferred tax liabilities						616						677
Employee benefit obligations						224						201
Other non-current liabilities						481						471
Total non-current liabilities						8,437						8,182
Total liabilities						$	12,913					$	13,285
Commitments and contingencies (See Note 20)
Shareholders' Equity
Amcor plc shareholders’ equity:
Ordinary shares ($0.01 par value):
Authorized (9,000 million shares)
Issued (1,448 and 1,489 million shares, respectively)						$	14					$	15
Additional paid-in capital						4,021						4,431
Retained earnings						865						534
Accumulated other comprehensive loss						(862)						(880)
Treasury shares (1 and 2 million shares, respectively)						(12)						(18)
Total Amcor plc shareholders' equity						4,026						4,082
Non-controlling interests						64						59
Total shareholders' equity						4,090						4,141
Total liabilities and shareholders' equity						$	17,003					$	17,426

See accompanying notes to consolidated financial statements.

Amcor plc and Subsidiaries

Consolidated Statements of Cash Flows

($ in millions)

For the years ended June 30,						2023						2022						2021
Cash flows from operating activities:
Net income						$	1,058					$	815					$	951
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization, and impairment						586						625						574
Russia and Ukraine impairment						—						138						—
Net periodic benefit cost						11						12						15
Amortization of debt discount and deferred financing costs						4						2						10
Net gain on disposal of property, plant, and equipment						(5)						(3)						(10)
Net gain on disposal of businesses						(220)						—						(44)
Equity in income of affiliated companies						—						—						(19)
Net foreign exchange (gain)/loss						28						(14)						21
Share-based compensation						54						63						58
Other, net						5						106						(83)
Loss from hyperinflationary accounting for Argentine subsidiaries						62						22						27
Deferred income taxes, net						(57)						(33)						4
Dividends received from affiliated companies						—						—						4
Changes in operating assets and liabilities, excluding effect of acquisitions, divestitures, and currency:
Trade receivables						93						(272)						(189)
Inventories						248						(626)						(112)
Prepaid expenses and other current assets						(54)						(67)						(90)
Trade payables						(429)						711						342
Other current liabilities						21						123						11
Accrued employee costs						(84)						(20)						29
Employee benefit obligations						(25)						(35)						(40)
Other, net						(35)						(21)						2
Net cash provided by operating activities						1,261						1,526						1,461
Cash flows from investing activities:
Issuance of loans to affiliated companies						(1)						(5)						—
Investments in affiliated companies and other						(56)						(12)						(5)
Business acquisitions						(121)						—						—
Purchase of property, plant, and equipment, and other intangible assets						(526)						(527)						(468)
(Payments)/proceeds from divestitures						365						(1)						214
Proceeds from sales of property, plant, and equipment, and other intangible assets						30						18						26
Net cash used in investing activities						(309)						(527)						(233)
Cash flows from financing activities:
Proceeds from issuance of shares						134						114						30
Purchase of treasury shares						(221)						(143)						(8)
Purchase of non-controlling interest						—						—						(8)
Proceeds from issuance of long-term debt						522						1,066						790
Repayment of long-term debt						(330)						(1,243)						(530)
Net borrowing/(repayment) of commercial paper						94						638						(235)
Net borrowing/(repayment) of short-term debt						(58)						15						(123)
Repayment of lease liabilities						(11)						(5)						(2)
Share buyback/cancellations						(432)						(601)						(351)
Dividends paid						(723)						(732)						(742)
Net cash used in financing activities						(1,025)						(891)						(1,179)
Effect of exchange rates on cash and cash equivalents						(88)						(108)						58
Cash and cash equivalents classified as held for sale						—						(75)						—
Net increase/(decrease) in cash and cash equivalents						(161)						(75)						107
Cash and cash equivalents balance at beginning of the fiscal year						850						850						743
Cash and cash equivalents balance at end of the fiscal year						$	689					$	775					$	850

See accompanying notes to consolidated financial statements, including Note 23, "Supplemental Cash Flow Information." Cash and cash equivalents at the beginning of the year include cash and cash equivalents classified as held for sale.

Amcor plc and Subsidiaries

Consolidated Statements of Equity

($ in millions, except per share data)

						Ordinary Shares						Additional Paid-In Capital						Retained Earnings						Accumulated Other Comprehensive Loss						Treasury Shares						Non-controlling Interest						Total
Balance as of June 30, 2020						$	16					$	5,480					$	246					$	(1,049)					$	(67)					$	61					$	4,687
Net income																		939																		12						951
Other comprehensive income																								283												—						283
Share buyback/cancellations						(1)						(350)																														(351)
Dividends declared ($0.4675 per share)																		(728)																		(14)						(742)
Options exercised and shares vested												(16)																		46												30
Net settlement of forward contracts to purchase own equity for share-based incentive plans, net of tax												(72)																														(72)
Purchase of treasury shares																														(8)												(8)
Share-based compensation expense												58																														58
Change in non-controlling interest												(8)						—																		(2)						(10)
Cumulative adjustment related to the adoption of ASC 326																		(5)																								(5)
Balance as of June 30, 2021						15						5,092						452						(766)						(29)						57						4,821
Net income																		805																		10						815
Other comprehensive loss																								(114)												—						(114)
Share buyback/cancellations						—						(601)																														(601)
Dividends declared ($0.4775 per share)																		(723)																		(9)						(732)
Options exercised and shares vested												(40)																		154												114
Net settlement of forward contracts to purchase own equity for share-based incentive plans, net of tax												(83)																														(83)
Purchase of treasury shares																														(143)												(143)
Share-based compensation expense												63																														63
Change in non-controlling interest																		—																		1						1
Balance as of June 30, 2022						15						4,431						534						(880)						(18)						59						4,141
Net income																		1,048																		10						1,058
Other comprehensive income																								18												—						18
Share buyback/cancellations						(1)						(431)																														(432)
Dividends declared ($0.4875 per share)																		(717)																		(6)						(723)
Options exercised and shares vested												(93)																		227												134
Net settlement of forward contracts to purchase own equity for share-based incentive plans, net of tax												60																														60
Purchase of treasury shares																														(221)												(221)
Share-based compensation expense												54																														54
Change in non-controlling interest																																				1						1
Balance as of June 30, 2023						$	14					$	4,021					$	865					$	(862)					$	(12)					$	64					$	4,090

See accompanying notes to consolidated financial statements.

Amcor plc and Subsidiaries

Notes to Consolidated Financial Statements

Note 1 - Business Description

Amcor plc ("Amcor" or the "Company") is a public limited company incorporated under the Laws of the Bailiwick of Jersey. The Company's history dates back more than 150 years, with origins in both Australia and the United States of America. Today, Amcor is a global leader in developing and producing responsible packaging for food, beverage, pharmaceutical, medical, home and personal-care, and other consumer goods end markets. The Company's innovation excellence and global packaging expertise enables the Company to solve packaging challenges around the world every day, producing packaging that is more functional, appealing, and cost effective for its customers and their consumers and importantly, more sustainable for the environment.

The Company's business activities are organized around two reportable segments, Flexibles and Rigid Packaging. The Company has a globally diverse operating footprint, selling to customers in Europe, North America, Latin America, and the Asia Pacific regions. The Company develops and produces a broad range of packaging products including flexible packaging, rigid packaging containers, specialty cartons, and closures. The Company's sales are widely diversified, with the majority of sales made to the food, beverage, pharmaceutical, medical device, home and personal care, and other consumer goods end markets. All markets are considered to be highly competitive as to price, innovation, quality, and service.

Note 2 - Significant Accounting Policies

Basis of Presentation and Principles of Consolidation: The consolidated financial statements include the accounts of the Company and its subsidiaries, for which the Company has a controlling financial interest. All significant intercompany transactions and balances have been eliminated. The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP").

The Company reclassified prior year inventory comparatives in the condensed consolidated balance sheets to conform to the current year's presentation which provides the breakdown of inventory. This change in presentation did not have an impact on the Company’s financial condition or operating results. Certain amounts in the Company's notes to consolidated financial statements may not add up or recalculate due to rounding.

Business Combinations: The Company uses the acquisition method of accounting, which requires separate recognition of assets acquired and liabilities assumed from goodwill, at the acquisition date fair values. Goodwill as of the acquisition date is measured as the excess of consideration transferred and the fair value of any non-controlling interests in the acquiree over the net of the acquisition date fair values of the assets acquired and liabilities assumed. During the measurement period, which may be up to one year from the acquisition date, the Company has the ability to record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. After the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded in the consolidated statements of income.

Held for Sale and Discontinued Operations: The Company classifies assets and liabilities (the "disposal group") as held for sale in the period when all of the relevant criteria to be classified as held for sale are met. These criteria include management's commitment to sell the disposal group in its present condition and the sale being deemed probable of being completed within one year. Assets held for sale are reported at the lower of their carrying value or fair value less cost to sell. Fair value is determined based on management’s assessment of indicative bids, a market multiples model in which a market multiple is applied to forecasted earnings before interest, taxes, depreciation, and amortization (“EBITDA”), discounted cash flows, appraised values, or management's estimates, depending on the specific situation. Any loss resulting from the measurement is recognized in the period when the held for sale criteria are met. If the disposal group meets the definition of a business, the goodwill within the reporting unit is allocated to the disposal group based on its relative fair value. The Company assesses the fair value of a disposal group, less any costs to sell, each reporting period it remains classified as held for sale and reports any subsequent changes as an adjustment to the carrying value of the disposal group, as long as the new carrying value does not exceed the initial carrying value of the disposal group. Assets held for sale are not amortized or depreciated. The Company recorded an impairment charge on assets held for sale of $90 million for the fiscal year ended June 30, 2022. See Note 6, "Held for Sale," for more information on assets held for sale.

A disposal group that represents a strategic shift to the Company or is acquired with the intention to sell is reflected as a discontinued operation on the consolidated statements of income and prior periods are recast to reflect the earnings or losses as income from discontinued operations.

Estimates and Assumptions Required: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods.

These estimates are based on historical experience and various assumptions believed to be reasonable under the circumstances. Management evaluates these estimates on an ongoing basis and adjusts or revises them as circumstances change. As future events and their impacts cannot be determined with precision, actual results may differ from these estimates. In the opinion of management, the consolidated financial statements reflect all adjustments necessary to fairly present the results of the periods presented.

Translation of Foreign Currencies: The reporting currency of the Company is the U.S. dollar. The functional currency of the Company’s subsidiaries is generally the local currency of each entity. Transactions in currencies other than the functional currency of the entity are recorded at the exchange rates prevailing at the transaction date. Monetary assets and liabilities in currencies other than the entity’s functional currency are remeasured at the exchange rates as of the balance sheet date to the entity’s functional currency. Foreign currency transaction gains and losses related to short-term and long-term debt are recorded in other non-operating income, net, in the consolidated statements of income and the net gains or net losses are not material in any of the periods presented. All other foreign currency transaction gains and losses are recorded in other income, net in the consolidated statements of income. These foreign currency transaction net gains or net losses amounted to a net loss of

$17 million, a net gain of $19 million, and a net loss of $4 million during the fiscal years ended June 30, 2023, 2022, and 2021, respectively.

Upon consolidation, the results of operations of subsidiaries with functional currencies other than the reporting currency of the Company are translated using average exchange rates during each year. Assets and liabilities of operations with a functional currency other than the U.S. dollar are translated at the exchange rates as of the balance sheet date, while equity balances are translated at historical rates. Translation gains and losses are reported in accumulated other comprehensive loss as a component of shareholders’ equity.

Highly Inflationary Accounting: A highly inflationary economy is defined as an economy with a cumulative inflation rate of approximately 100 percent or more over a three-year period. As of July 1, 2018, the Argentine economy was designated as highly inflationary for accounting purposes. Accordingly, the U.S. dollar replaced the Argentine peso as the functional currency for the Company's subsidiaries in Argentina. The impact of highly inflationary accounting on monetary balances was a loss of $24 million, $16 million, and $19 million for the fiscal years ended June 30, 2023, 2022, and 2021, respectively, in the consolidated statements of income.

Revenue Recognition: The Company generates revenue by providing its customers with flexible and rigid packaging, serving a variety of markets including food, consumer products, and healthcare end markets. The Company enters into a variety of agreements with customers, including quality agreements, pricing agreements, and master supply agreements, which outline the terms under which the Company does business with a specific customer. The Company also sells to some customers solely based on purchase orders. The Company has concluded for the vast majority of its revenues, that its contracts with customers are either a purchase order or the combination of a purchase order with a master supply agreement. All revenue recognized in the consolidated statements of income is considered to be revenue from contracts with customers.

The Company typically satisfies the obligation to provide packaging to customers at a point in time upon shipment when control is transferred to customers. Revenue is recognized net of allowances for returns and customer claims and any taxes collected from customers, which are subsequently remitted to governmental authorities. The Company does not have any material contract assets or contract liabilities. The Company disaggregates revenue based on geography. Disaggregation of revenue is presented in Note 21, "Segments."

Significant Judgments

Determining whether products and services should be accounted for as distinct performance obligations or as combined performance obligations may require significant judgment. The Company has identified potential performance obligations in its customer master supply agreements and determined that none of them are capable of being distinct as the customer can only benefit from the supplied packaging. Therefore, the Company has concluded that it has one performance obligation, which is to supply packaging to customers.

The Company may provide variable consideration in several forms, which are determined through its agreements with customers. The Company can offer prompt payment discounts, sales rebates, or other incentive payments to customers. Sales rebates and other incentive payments are typically awarded upon achievement of certain performance metrics, including volume. The Company accounts for variable consideration using the most likely amount method. The Company utilizes forecasted sales data and rebate percentages specific to each customer agreement and updates its judgment of the amounts to which the customer is entitled each period.

The Company enters into long-term agreements with certain customers, under which it is obligated to make various up-front payments for which it expects to receive a benefit in excess of the cost over the term of the contract. These up-front payments are deferred and reflected in prepaid expenses and other current assets or other non-current assets on its consolidated balance sheets. Contract incentives are typically recognized as a reduction to revenue over the term of the customer agreement.

Practical Expedients

The Company sells primarily through its direct sales force. Any external sales commissions are expensed when incurred because the amortization period would be one year or less. External sales commission expense is included in selling, general, and administrative expenses in the consolidated statements of income.

The Company accounts for shipping and handling activities as fulfillment costs. Accordingly, shipping and handling costs are classified as a component of cost of sales while amounts billed to customers are classified as a component of net sales.

The Company excludes from the measurement of the transaction price all taxes assessed by a government authority that are both imposed on and concurrent with a specific revenue producing transaction and collected from the customer, including sales taxes, value added taxes, excise taxes, and use taxes. Accordingly, the tax amounts are not included in net sales.

The Company does not adjust the promised consideration for the time value of money for contracts where the difference between the time of payment and performance is one year or less.

Research and Development: Research and development expenses are expensed as incurred.

Restructuring Costs: Restructuring costs are recognized when the liability is incurred. The Company calculates severance obligations based on its standard customary practices. Accordingly, the Company records provisions for severance when payments are probable and estimable and when the Company has committed to the restructuring plan. In the absence of a standard customary practice or established local practice, liabilities for severance are recognized when incurred. If fixed assets become impaired as a result of the Company’s restructuring efforts, these assets are written down to their fair value less costs to sell, as the Company commits to dispose of them, and they are no longer in use. Depreciation is accelerated on fixed assets for the period of time the asset continues to be used until the asset ceases to be used. Other restructuring costs, including costs to relocate equipment, are generally recorded as the cost is incurred or the service is provided. See Note 7, "Restructuring," for more information on the Company’s restructuring plans.

Cash, Cash Equivalents, and Restricted Cash: The Company considers all highly liquid investments, with a maturity of three months or less when purchased, to be cash equivalents. Cash equivalents include demand deposits that can be readily liquidated without penalty at the Company’s option. Cash equivalents are carried at cost which approximates fair market value. The Company had restricted cash of $8 million as of June 30, 2022, which was held in a share trust associated with Company share-based payment obligations. The Company had an immaterial amount of restricted cash as of June 30, 2023.

Trade Receivables, net of allowance for credit losses ("Trade accounts receivable, net"): Trade accounts receivable, net, are stated at the amount the Company expects to collect, which is net of an allowance for sales returns and the estimated losses resulting from the inability of its customers to make required payments. The allowance for doubtful accounts is estimated based on the current expected credit loss model ("CECL") and it incorporates information about past events, current conditions, and reasonable and supportable forecasts of future economic conditions. When determining the collectability of specific customer accounts, several factors are evaluated, including customer creditworthiness, past transaction history with the customer, and changes in customer payment terms or practices. In addition, overall historical collection experience, current economic industry trends, and a review of the current status of trade accounts receivable are considered when determining the required allowance for credit losses. Changes in allowance for doubtful accounts were not material for fiscal years ended June 30, 2023, 2022, and 2021.

The Company enters into customer-based supply-chain financing programs from time to time to sell trade receivables to third-party financial institutions. Agreements which result in true sales of the transferred receivables, which occur when receivables are transferred without recourse to the Company, are reflected as a reduction of trade receivables, net on the consolidated balance sheets and the proceeds are included in the cash flows from operating activities in the consolidated statements of cash flows. Agreements that allow the Company to maintain effective control over the transferred receivables and which do not qualify as a true sale are accounted for as secured borrowings and recorded on the consolidated balance sheets within trade receivables, net and short-term debt. The expenses associated with receivables factoring are recorded in the consolidated statements of income primarily as a reduction of net sales. The Company did not factor any trade receivables in fiscal years 2023 and 2022 which did not qualify as true sales of the receivables.

Inventories, net: Inventories are stated at the lower of cost and net realizable value. The cost of inventories is based upon the first-in, first-out ("FIFO") method or average cost method. Costs related to inventories include raw materials, direct labor, and manufacturing overhead. Inventory reserves were $130 million and $111 million as of June 30, 2023, and 2022, respectively.

Property, Plant, and Equipment, Net ("PP&E"): PP&E is carried at cost less accumulated depreciation and impairment and includes expenditures for new facilities and equipment, as well as costs that substantially increase the useful lives or capacity of existing PP&E. Cost of constructed assets includes capitalized interest incurred during the construction period. Maintenance and repairs that do not improve efficiency or extend economic life are expensed as incurred.

PP&E, including assets held under finance leases, is depreciated using the straight-line method over the estimated useful lives of the assets or, in the case of leasehold improvements and finance leases, over the period of the lease or useful life of the asset as described below. The Company periodically reviews these estimated useful lives and, when appropriate, changes are made prospectively.

Leasehold land						Over lease term
Land improvements						Up to 30 years
Buildings						Up to 45 years
Machinery and equipment						Up to 25 years
Finance leases						Lease term or 5 - 25 years

Impairment of Long-lived Assets: The Company reviews long-lived assets, primarily PP&E and certain identifiable intangible assets with finite lives, for impairment when facts or circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. If impairment indicators are present and the estimated future undiscounted cash flows are less than the carrying value of the assets, the carrying values are reduced to the estimated fair value. Fair values are determined based on quoted market values, discounted cash flows, or external appraisals, as applicable.

Impairment of long-lived assets recognized in the consolidated statements of income, excluding assets held for sale, were as follows:

						Years ended June 30,
($ in millions)						2023						2022						2021
Selling, general, and administrative expenses						$	—					$	1					$	1
Restructuring, impairment, and other related activities, net						18						42						9
Total impairment losses recognized in the consolidated statements of income						$	18					$	43					$	10

Leases: The Company enters into leasing arrangements for certain manufacturing sites, offices, warehouses, land, vehicles, and equipment. The Company determines at the inception of the contract whether the contract is or contains a lease. A contract is a lease if it conveys the right to control an identified asset for a period of time in exchange for consideration.

For leases with an original term of more than twelve months, the Company recognizes a right-of-use (“ROU”) asset and a lease liability. Short-term leases with a term of twelve months or less are not recorded on the consolidated balance sheets and the related expense is recognized on a straight-line basis over the term of the lease.

Lease liabilities are recognized at the commencement date based on the present value of the remaining lease payments over the lease terms, which include any noncancellable lease terms and any renewal periods that the Company is reasonably certain to exercise. A significant portion of the Company's leases includes an option or options to extend the lease term. The Company re-evaluates its leases on a regular basis to consider the economic and strategic incentives of exercising lease renewal options. As the implicit rates in the Company's leases generally cannot be readily determined, the Company uses estimates of its incremental borrowing rate as the discount rates to determine the lease liabilities.

Certain leases require variable payments that are dependent on usage, output, or other factors. Variable lease payments that do not depend on an index or rate are excluded from lease payments in the measurement of the ROU lease asset and lease liability and recognized as an expense in the period in which the obligation for the payments occur.

Goodwill: Goodwill represents the excess of cost over the fair value of net assets acquired in a business combination. Goodwill is not amortized but is instead tested annually for impairment by the Company in the fourth quarter of each fiscal year or whenever events and circumstances indicate an impairment may have occurred during the fiscal year. Factors that could trigger an impairment review include a significant decline in a reporting unit’s operating results compared to its operating plan or historical performance, and competitive pressures and changes in the general markets in which it operates. All goodwill is assigned to a reporting unit, which is defined as the operating segment. The Company has six reporting units with goodwill that are assessed for potential impairment.

When performing the required impairment tests, the Company has the option to first assess qualitative factors to determine if a quantitative assessment for goodwill impairment is necessary. If the qualitative assessment concludes that it is more likely than not that the fair value of a reporting unit is less than its carrying value, the Company performs a quantitative assessment. The Company's quantitative assessment utilizes a discounted cash flow model to determine the fair value of the reporting units. Deriving fair value using discounted cash flows requires judgment and is sensitive to changes in underlying assumptions and market factors. Key assumptions include revenue growth, projected operating income growth, market

multiples, terminal values, and discount rates. Sensitivity analyses are performed around certain of these assumptions to assess the reasonableness of the assumptions and the resulting estimated fair values. If current expectations of future growth rates and margins are not met, or if market factors beyond the Company’s control, such as factors impacting the applicable discount rate or economic or political conditions in key markets change significantly, then goodwill allocated to one or more reporting units may be impaired.

In fiscal year 2023, the Company performed quantitative impairment tests for all of its reporting units and the Company concluded that goodwill was not impaired as the fair values of the reporting units substantially exceeded their carrying values.

Other Intangible Assets, Net: Contractual or separable intangible assets that have finite useful lives are amortized against income using the straight-line method over their estimated useful lives, which range from 1 to 20 years. The straight-line method of amortization reflects an appropriate allocation of the costs of the intangible assets to earnings in proportion to the amount of economic benefits obtained by the Company in each reporting period.

Costs incurred to develop software programs to be used solely to meet the Company's internal needs have been capitalized as computer software within other intangible assets.

Fair Value Measurements: The fair values of the Company's financial assets and financial liabilities reflect the amounts that would be received to sell the assets or paid to transfer the liabilities in an orderly transaction between market participants at the measurement date (exit price). The Company determines fair value based on a three-tiered fair value hierarchy. The hierarchy consists of:

• Level 1: fair value measurements represent exchange-traded securities, which are valued at quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access as of the reporting date;

• Level 2: fair value measurements are determined using input prices that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data; and

• Level 3: fair value measurements are determined using unobservable inputs, such as internally developed pricing models for the asset or liability due to little or no market activity for the asset or liability.

Derivative Instruments: The Company recognizes all derivative instruments on the consolidated balance sheets at fair value. The impact on earnings from recognizing the fair values of these instruments depends on their intended use, their hedge designation and their effectiveness in offsetting changes in the fair values of the exposures they are hedging. Derivatives not designated as hedging instruments are adjusted to fair value through income. Depending on the nature of derivatives designated as hedging instruments, changes in the fair value are either offset against the change in fair value of the hedged assets, liabilities, or firm commitments through earnings or recognized in shareholders’ equity through other comprehensive income/(loss) until the hedged item is recognized. Gains or losses, if any, related to the ineffective portion of any hedge are recognized through earnings over the life of the hedging relationship.

See Note 12, "Derivative Instruments," for more information regarding specific derivative instruments included on the Company’s consolidated balance sheets, such as forward foreign currency exchange contracts, currency swap contracts, and interest rate swap arrangements, among other derivative instruments.

Employee Benefit Plans: The Company sponsors various defined contribution plans to which it makes contributions on behalf of employees. The expense under such plans was $87 million, $79 million, and $68 million for the fiscal years ended June 30, 2023, 2022, and 2021, respectively.

The Company also sponsors a number of defined benefit plans that provide benefits to current and former employees. For the Company-sponsored plans, the relevant accounting guidance requires management to make certain assumptions relating to the long-term rate of return on plan assets, discount rates used to determine the present value of future obligations and expenses, salary inflation rates, mortality rates, and other assumptions. The Company believes that the accounting estimates related to its pension plans are critical accounting estimates because they are highly susceptible to change from period to period based on the performance of plan assets, actuarial valuations, market conditions, and contracted benefit changes. The selection of assumptions is based on historical trends, known economic and market conditions at the time of valuation, and independent studies of trends performed by the Company’s actuaries. However, actual results may differ substantially from the estimates that were based on the critical assumptions.

The Company recognizes the funded status of each defined benefit pension plan in the consolidated balance sheets. Each overfunded plan is recognized as an asset in employee benefit assets and each underfunded plan is recognized as a liability in employee benefit obligations. Pension plan liabilities are revalued annually, or when an event occurs that requires remeasurement, based on updated assumptions and information about the individuals covered by the plan. Accumulated actuarial gains and losses in excess of a 10 percent corridor and the prior service cost are amortized on a straight-line basis from the date recognized over the average remaining service period of active participants or over the average life expectancy for plans with significant inactive participants. The service costs related to defined benefits are included in operating income. The other components of net benefit cost other than service cost are recorded within other non-operating income, net in the consolidated statements of income.

Equity Method and Other Investments: Investments in ordinary shares of companies, in which the Company believes it exercises significant influence over operating and financial policies, are accounted for using the equity method of accounting. Investments in limited partnerships or limited liability companies that maintain separate ownership accounts are also accounted for under the equity method unless the Company's interest is so minor that it has virtually no influence over the investee's operating and financial policies. Under this method, the investment is carried at cost and is adjusted to recognize the investor’s share of earnings or losses of the investee after the date of acquisition and is adjusted for impairment whenever it is determined that a decline in the fair value below the cost basis is other than temporary. The fair value of the investment then becomes the new cost basis of the investment, and it is not adjusted for subsequent recoveries in fair value. The Company reviews its investments accounted for under the equity method for impairment whenever events or changes in circumstances indicate the carrying amount may not be recoverable.

All equity investments that do not result in consolidation and are not accounted for under the equity method are measured at fair value with unrealized gains and losses related to mark-to-market adjustments included in net income. The Company utilizes the measurement alternative for equity investments that do not have readily determinable fair values and measures these investments at cost adjusted for impairments and observable price changes in orderly transactions. See Note 8, "Equity Method and Other Investments," for more information on the Company's equity method and other investments.

Contingencies: The Company is subject to numerous contingencies arising in the ordinary course of business, such as legal and administrative proceedings, environmental claims and proceedings, workers' compensation, and other claims. Accruals for estimated losses are recorded by the Company at the time information becomes available indicating that losses are probable, and the amounts can be reasonably estimated. When management can reasonably estimate a range of losses it may incur, it records an accrual for the amount within the range that constitutes its best estimate. If no amount within a range appears to be a better estimate than any other, the low end of the range is accrued. The Company records anticipated recoveries under existing insurance contracts when recovery is probable.

Share-based Compensation: The Company has a variety of equity incentive plans. For employee awards with a service or market condition, compensation expense is recognized over the vesting period on a straight-line basis using the grant date fair value of the award and the estimated number of awards that are expected to vest. For awards with a performance condition, the Company reassesses the probability of vesting at each reporting period and adjusts compensation cost based on its probability assessment. The Company also has immaterial cash-settled share-based compensation plans which are accounted for as liabilities. Such share-based awards are remeasured to fair value at each reporting date. The Company estimates forfeitures based on employee level, time remaining to vest, and historical forfeiture experience.

Income Taxes: The Company uses the asset and liability method to account for income taxes. Deferred income taxes reflect the future tax consequences of temporary differences between the tax bases of assets and liabilities and their financial reporting amounts at each balance sheet date, based upon enacted income tax laws and tax rates. Income tax expense or benefit is provided based on earnings reported in the consolidated financial statements. The provision for income tax expense or benefit differs from the amounts of income taxes currently payable because certain items of income and expense included in the consolidated financial statements are recognized in different time periods by taxing authorities.

Deferred tax assets, including operating losses, capital losses, and tax credit carryforwards, are reduced by a valuation allowance when it is more likely than not that any portion of these tax attributes will not be realized. In addition, from time to time, management assesses the need to accrue or disclose uncertain tax positions. In making these assessments, management must often analyze complex tax laws of multiple jurisdictions. Accounting guidance prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company records the related interest expense and penalties, if any, as tax expense in the tax provision. See Note 17, "Income Taxes," for more information on the Company's income taxes.

Note 3 - New Accounting Guidance

Recently Adopted Accounting Standards

In November 2021, the FASB issued an Accounting Standards Update ("ASU") 2021-10, Government Assistance, (Topic 832) that adds certain disclosure requirements for entities that receive government assistance. The standard is effective for annual periods beginning after December 15, 2021, with early application permitted. The Company adopted ASU 2021-10 on July 1, 2022. The Company analyzed amounts received from government assistance programs and determined the program amounts received are individually, and in the aggregate, not material. ASU 2021-10 may have an impact on the Company’s disclosures in the future, if government assistance provided to the Company were to become material.

Accounting Standards Not Yet Adopted

In September 2022, the FASB issued ASU 2022-04 that adds certain disclosure requirements for entities that use supplier finance programs in connection with the purchase of goods and services. The new standard's requirement to disclose the key terms of supplier finance programs is effective for all interim and annual periods beginning with the Company's fiscal year ending June 30, 2024. The new standard does not affect the recognition, measurement, or financial statement presentation of supplier finance program obligations. Early adoption is permitted. The Company adopted this new disclosure guidance on July 1, 2023, except for the amendment on roll forward information which is not effective until July 1, 2024.

The Company considers the applicability and impact of all ASUs issued by the FASB. The Company determined at this time that all other ASUs not yet adopted are either not applicable or are expected to have minimal impact on the Company's consolidated financial statements.

Note 4 - Restructuring, Impairment, and Other Related Activities, Net

Restructuring, impairment, and other related activities, net as reported on the consolidated statements of income are summarized as follows:

						Years ended June 30,
($ in millions)						2023						2022						2021
Gain on disposal of Russian business, net						$	215					$	—					$	—
Restructuring and related expenses, net						(111)						(96)						(94)
Russia-Ukraine impairment expenses						—						(138)						—
Restructuring, impairment, and other related activities, net						$	104					$	(234)					$	(94)

A pre-tax net gain on disposal of the Company's three manufacturing facilities in Russia ("Russian business") of $215 million was recognized during fiscal year 2023. The carrying value of the Russian business had previously been impaired by $90 million in the fourth quarter of fiscal year 2022, following the Company's approved plan to sell its Russian operations. For further information, refer to Note 5, "Acquisitions and Divestitures," and Note 6, "Held for Sale."

Impairment expenses of $138 million were incurred in the fourth quarter of fiscal year 2022 as a result of the Russia-Ukraine Conflict. In addition to the impairment charge on Russian business mentioned above, the Company recognized other expenses of $48 million, given the expectation that certain assets not held for sale in the conflict region will not be recoverable. The Company's manufacturing plant in Ukraine ceased operations in February 2022 and has not resumed operations given the ongoing conflict in the region has displaced the Company's employees, destroyed nearby manufacturing facilities, and impaired the region's supporting infrastructure. Other asset impairment expenses in the last three fiscal years were not material and were primarily reported in restructuring and related expenses, net.

Refer to Note 7, "Restructuring," for information on restructuring and related expenses, net.

Note 5 - Acquisitions and Divestitures

Year ended June 30, 2023

Acquisitions

On August 1, 2022, the Company completed the acquisition of 100% equity interest in a Czech Republic company that operates a world-class flexible packaging manufacturing plant. The purchase consideration of $59 million included a deferred portion of $5 million that was paid in the first quarter of fiscal year 2024. The acquisition is part of the Company's Flexibles reportable segment and resulted in the recognition of acquired identifiable net assets of $36 million and goodwill of $23 million. Goodwill is not deductible for tax purposes. The fair values of the identifiable net assets acquired and goodwill are based on the Company's best estimate as of June 30, 2023.

On March 17, 2023, the Company completed the acquisition of 100% equity interest in a medical device packaging manufacturing site in Shanghai, China. The purchase consideration of $60 million is subject to customary post-closing adjustments. The consideration includes contingent consideration of $20 million, to be earned and paid in cash over the three years following the acquisition date, subject to meeting certain performance targets. The acquisition is part of the Company's Flexibles reportable segment and resulted in the recognition of acquired identifiable net assets of $21 million and goodwill of $39 million. Goodwill is not deductible for tax purposes. The fair values of the contingent consideration, identifiable net assets acquired, and goodwill are based on the Company's best estimate as of June 30, 2023, and are considered preliminary. The Company aims to complete the purchase price allocation as soon as practicable but no later than one year from the date of the acquisition.

On May 31, 2023, the Company completed the acquisition of a New Zealand based leading manufacturer of state-of-the-art, automated protein packaging machines. The purchase consideration of $45 million is subject to customary post-closing adjustments. The consideration includes contingent consideration of $13 million, to be earned and paid in cash over the two years following the acquisition date, subject to meeting certain performance targets. The acquisition is part of the Company's Flexibles reportable segment and resulted in the recognition of acquired identifiable net assets of $9 million and goodwill of $36 million. Goodwill is deductible for tax purposes. The fair values of the contingent consideration, identifiable net assets acquired, and goodwill are based on the Company's best estimate as of June 30, 2023, and are considered preliminary. The Company aims to complete the purchase price allocation as soon as practicable but no later than one year from the date of the acquisition.

The fair value estimates for all three acquisitions were based on income, market, and cost valuation methods. Pro forma information related to these acquisitions has not been presented, as the effect of the acquisitions on the Company's consolidated financial statements was not material.

Disposal of Russian business

On December 23, 2022, the Company completed the sale of its Russian business after receiving all necessary regulatory approvals and cash proceeds, including receipt of closing cash balances. The sale follows the Company’s previously announced plan to pursue the orderly sale of its Russian business. The total net cash consideration received, excluding disposed cash and items settled net, was $365 million and resulted in a pre-tax net gain of $215 million. The carrying value of the Russian business had previously been impaired by $90 million in the quarter ended June 30, 2022. The impairment charge was based on the Company's best estimate of the fair value of its Russian business, which considered the wide range of indicative bids received and uncertain regulatory environment. The net pre-tax gain on disposal of the Russian business has been recorded as restructuring, impairment, and other related activities, net within the consolidated statements of income. The Russian business had a net carrying value of $252 million, including allocated goodwill of $46 million and accumulated other comprehensive losses of $73 million, primarily attributed to foreign currency translation adjustments.

Year ended June 30, 2022

During the third quarter of fiscal year 2022, the Company completed the disposal of non-core assets in the Flexibles reporting segment. The Company recorded an expense of $10 million during the fiscal year ended June 30, 2022, to adjust the long-lived assets to their fair value less cost to sell.

Year ended June 30, 2021

As part of optimizing its portfolio under the 2019 Bemis Integration Plan, the Company completed the disposal of a non-core European hospital supplies business, which was part of the Flexibles reportable segment. The resulting gain from the sale has been recorded in the line restructuring, impairment, and other related activities, net, in the consolidated statements of income. Refer to Note 7, "Restructuring."

The Company also completed the disposal of two non-core businesses in India and Argentina in the Flexibles reportable segment during the first quarter of fiscal year 2021, recording a loss on sale of $6 million recorded in the line other income, net, in the consolidated statements of income, which was primarily driven by the reclassification of cumulative translation adjustments through the income statements that had previously been recorded in other comprehensive income/(loss).

The Company sold its equity investment in AMVIG Holdings Limited ("AMVIG") in the first quarter of fiscal year 2021. Refer to Note 8, "Equity Method and Other Investments."

Note 6 - Held for Sale

During the fourth quarter of fiscal year 2022, the Company classified the assets and liabilities of its Russian operations as held for sale as a result of the Company's decision to sell its Russian business and recorded an impairment of $90 million. On December 23, 2022, the Company completed the sale of the Russian business and derecognized the assets and liabilities previously classified as held for sale. The disposal did not represent a strategic shift that had a major effect on the Company's operations and financial results, and therefore did not qualify for reporting as a discontinued operation. The Russian business was part of the Company’s Flexibles reportable segment. For further information, refer to Note 5, "Acquisitions and Divestitures."

Major classes of assets and liabilities of the Russian business classified as held for sale were as follows:

($ in millions)						June 30, 2023			June 30, 2022
Cash and cash equivalents						$	—		$	75
Trade receivables, net						—			66
Inventories, net						—			40
Prepaid expenses and other current assets						—			36
Property, plant, and equipment, net						—			49
Goodwill						—			16
Total assets held for sale						—			282
Less accumulated impairment (1)						—			(90)
Total assets held for sale, net						$	—		$	192
Trade payables						—			65
Total current liabilities held for sale						$	—		$	65

(1) Inclusive of accumulated other comprehensive loss related to the Russian business.

This table excludes other non-material assets and liabilities that are held for sale but not part of the Russian business.

Note 7 - Restructuring

Restructuring and related expenses, net were $111 million, $96 million, and $94 million for the fiscal years ended June 30, 2023, 2022, and 2021 respectively. The net expenses related to restructuring activities have been presented on the consolidated statements of income as part of restructuring, impairment, and other related activities, net. The Company's restructuring activities for the fiscal year ended June 30, 2023, primarily comprised of restructuring activities related to the 2023 Restructuring Plan (as defined below). The Company's restructuring activities for the fiscal year ended June 30, 2022, included expenses triggered by the Russia-Ukraine conflict to help mitigate the impact of the Russian sale and expenses related to the Company's 2019 plan from the integration of the acquired Bemis operations ("2019 Bemis Integration Plan"), which was substantially completed at the end of fiscal year 2022. The Company's restructuring activities for the fiscal year ended June 30, 2021, were mainly comprised of expenses related to the 2019 Bemis Integration Plan.

Restructuring related expenses are directly attributable to restructuring activities; however, they do not qualify for special accounting treatment as exit or disposal activities. The Company believes the disclosure of restructuring related costs provides more information on its restructuring activities.

2023 Restructuring Plan

On February 7, 2023, the Company announced that it will allocate approximately $110 million to $130 million of the sale proceeds from the Russian business to various cost saving initiatives to partly help offset divested earnings from the Russian business (the "2023 Restructuring Plan" or the "Plan"). The Company expects the total Plan cash and non-cash net expenses to total $200 million to $220 million. The Company has initiated by the end of fiscal year 2023 projects with an expected net cost of approximately $150 million, of which $65 million relates to employee related expenses, $15 million to fixed asset related expenses (net of expected gains on asset disposals), $55 million to other restructuring expenses, and $15 million to restructuring related expenses. The projects initiated in fiscal year 2023 are expected to result in $80 million of net cash expenditures. The Plan includes both the Flexibles and Rigid Packaging reportable segments and is expected to be largely completed by the end of fiscal year 2024.

During fiscal year 2023, the Company has incurred $65 million in employee related expenses, $13 million in fixed asset related expenses, $10 million in other restructuring, and $6 million in restructuring related expenses, with $86 million incurred in the Flexibles reportable segment and $8 million incurred in the Rigid Packaging reportable segment related to this Plan. In fiscal year 2023, the Plan resulted in net cash outflows of approximately $25 million.

The restructuring related costs relate primarily to the closure of facilities and include startup and training costs after relocation of equipment, and other costs incidental to the Plan.

2019 Bemis Integration Plan

In connection with the acquisition of Bemis Company, Inc. ("Bemis"), the Company initiated restructuring activities in the fourth quarter of 2019 aimed at integrating and optimizing the combined organization.

The 2019 Bemis Integration Plan was completed by June 30, 2022, with a final pre-tax integration cost amounting to $253 million. The total 2019 Bemis Integration Plan cost included $213 million of restructuring and related expenses, net, and $40 million of general integration expenses. The net cash expenditures for the plan, including disposal proceeds, were $170 million, of which $40 million related to general integration expenses. As part of this Plan, the Company incurred $144 million in employee related expenses, $36 million in fixed asset related expenses, $39 million in other restructuring and $45 million in restructuring related expenses, partially offset by a gain on disposal of a business of $51 million.

The restructuring related costs relate primarily to the closure of facilities and include costs to replace graphics, train new employees on relocated equipment, and losses on sale of closed facilities.

2018 Rigid Packaging Restructuring Plan

On August 21, 2018, the Company announced a restructuring plan in Amcor Rigid Packaging ("2018 Rigid Packaging Restructuring Plan") aimed at reducing structural costs and optimizing the footprint. The Plan included the closures of manufacturing facilities and headcount reductions to achieve manufacturing footprint optimization and productivity improvements as well as overhead cost reductions.

The 2018 Rigid Packaging Restructuring Plan was completed by June 30, 2021, with total pre-tax restructuring costs of $121 million, of which $78 million resulted in cash expenditures, with the main component being the cost to exit manufacturing facilities and employee related costs.

Other Restructuring Plans

The Company has entered into other restructuring plans ("Other Restructuring Plans"). The Company's restructuring charges related to these plans were $17 million, $59 million, and $6 million for the fiscal years ended June 30, 2023, 2022, and 2021, respectively. During fiscal year 2023, the Company recorded $17 million in restructuring and related expenses classified within Other Restructuring Plans of which $3 million relate to employee related expenses, $5 million to fixed asset related expenses, $5 million to other restructuring expenses, and $4 million to restructuring related expenses. During fiscal year 2022, the Company recorded $57 million in restructuring and related expenses classified within Other Restructuring Plans triggered by the Russia-Ukraine conflict to help mitigate the impact of disposed earnings from the Russian sale.

Consolidated Amcor Restructuring Plans

The total expenses incurred from the beginning of the Company's material restructuring plans are as follows:

($ in millions)												2018 Rigid Packaging Restructuring Plan						2019 Bemis Integration Plan (3)						2023 Restructuring Plan (1)						Other Restructuring Plans (2)						Total Restructuring and Related Expenses, Net
Fiscal year 2019												$	64					$	48					$	—					$	19					$	131
Fiscal year 2020												37						60						—						18						115
Fiscal year 2021												20						68						—						6						94
Fiscal year 2022												—						37						—						59						96
Fiscal year 2023												—						—						94						17						111
Net expenses incurred												$	121					$	213					$	94					$	119					$	547

(1)Fiscal year 2023 includes restructuring related costs from the 2023 Restructuring Plan of $6 million.

(2)Fiscal year 2023 includes restructuring related costs of $4 million that pertain to "Other Restructuring Plans." Fiscal year 2022 includes $55 million in restructuring expenses and $2 million of restructuring related expenses that pertain to the Russia-Ukraine conflict as discussed above in section "Other Restructuring Plans."

(3)Fiscal years 2022 and 2021 include $17 million and $13 million, respectively, of restructuring related costs from the 2019 Bemis Integration Plan.

An analysis of the restructuring expenses by type incurred follows:

						Years ended June 30,
($ in millions)						2023						2022						2021
Employee related expenses						$	68					$	58					$	76
Fixed asset related expenses						18						4						23
Other expenses						15						15						34
Gain on sale of business						—						—						(51)
Total restructuring expenses, net						$	101					$	77					$	82

An analysis of the Company's restructuring plan liability, not including restructuring related liabilities, is as follows:

($ in millions)						Employee Costs						Fixed Asset Related Costs						Other Costs						Total Restructuring Costs
Liability balance at June 30, 2020						$	70					$	3					$	12					$	85
Net charges to earnings						76						23						34						133
Cash paid						(61)						(5)						(30)						(96)
Non-cash and other						(9)						(23)						—						(32)
Foreign currency translation						2						2						1						5
Liability balance at June 30, 2021						78						—						17						95
Net charges to earnings						58						4						15						77
Cash (paid)/received, net						(27)						4						(14)						(37)
Non-cash and other						(3)						(5)						—						(8)
Foreign currency translation						(9)						—						—						(9)
Liability balance at June 30, 2022						97						3						18						118
Net charges to earnings						68						18						15						101
Cash paid						(42)						—						(13)						(55)
Non-cash and other						—						(18)						—						(18)
Foreign currency translation						3						—						1						4
Liability balance at June 30, 2023						$	126					$	3					$	21					$	150

The Company expects the majority of the liability for employee, fixed assets related, and other costs as of June 30, 2023, to be paid within the next twelve months. The accruals related to restructuring activities have been recorded on the consolidated balance sheets under other current liabilities and other non-current liabilities.

Note 8 - Equity Method and Other Investments

As of June 30, 2023, and 2022, the Company has invested $89 million and $22 million, respectively, in multiple equity and other investments. All of the investments are individually immaterial, with the Company's largest equity investment of $33 million in ePac Holdings, LLC ("ePac") representing an ownership of 18.9%. The Company's investment in ePac is accounted for under the equity method. All investments are included in other non-current assets in the Company's consolidated balance sheets. While immaterial in fiscal year 2023, the Company accounts for its share in ePac's net income in equity in income of affiliated companies, net of tax in the consolidated statements of income, with a three month lag due to the availability of financial information. The Company received no dividends from its equity method investments in the fiscal years ended June 30, 2023, and 2022. In fiscal year 2021, the Company received dividends of $4 million from its equity method investments.

The Company sold its equity method investment in AMVIG Holdings Limited ("AMVIG"), where it had held a 47.6% interest, on September 30, 2020, realizing a net gain of $15 million, which was recorded in equity in income of affiliated companies, net of tax in the consolidated statements of income.

Note 9 - Property, Plant, and Equipment, Net

The components of property, plant, and equipment, net, were as follows:

($ in millions)						June 30, 2023						June 30, 2022
Land and land improvements						$	203					$	201
Buildings and improvements						1,483						1,323
Plant and equipment						6,084						5,797
Total property, plant, and equipment						7,770						7,321
Accumulated depreciation						(3,963)						(3,617)
Accumulated impairment						(45)						(58)
Total property, plant, and equipment, net						$	3,762					$	3,646

Depreciation expense amounted to $395 million, $398 million, and $389 million for fiscal years 2023, 2022, and 2021, respectively. Amortization of assets under finance leases is included in depreciation expense.

Note 10 - Goodwill and Other Intangible Assets

Changes in the carrying amount of goodwill attributable to each reportable segment were as follows:

($ in millions)						Flexibles Segment						Rigid Packaging Segment						Total
Balance as of June 30, 2021						$	4,437					$	982					$	5,419
Held for sale reclassification (1)						(16)						—						(16)
Foreign currency translation						(114)						(4)						(118)
Balance as of June 30, 2022						4,307						978						5,285
Acquisitions and acquisition adjustments (2)						98						—						98
Disposals (1)						(30)						—						(30)
Foreign currency translation						16						(3)						13
Balance as of June 30, 2023						$	4,391					$	975					$	5,366

(1) As of June 30, 2022, $16 million of goodwill attributable to the Russian business was classified as assets held for sale, net. When the business was disposed on December 23, 2022, an additional $30 million of goodwill was allocated and disposed of. For further information, refer to Note 5, "Acquisitions and Divestitures," and Note 6, "Held for Sale."

(2) Acquisitions and acquisition adjustments are detailed in Note 5, "Acquisitions and Divestitures."

Other Intangible Assets, Net

Other intangible assets, net is comprised of the following:

						June 30, 2023
($ in millions)						Gross Carrying Amount						Accumulated Amortization and Impairment (1)						Net Carrying Amount
Customer relationships						$	1,987					$	(660)					$	1,327
Computer software						261						(185)						76
Other (2)						327						(206)						121
Total other intangible assets						$	2,575					$	(1,051)					$	1,524

						June 30, 2022
($ in millions)						Gross Carrying Amount						Accumulated Amortization and Impairment (1)						Net Carrying Amount
Customer relationships						$	1,970					$	(529)					$	1,441
Computer software						235						(162)						73
Other (2)						323						(180)						143
Total other intangible assets						$	2,528					$	(871)					$	1,657

(1)Accumulated amortization and impairment included $34 million and $33 million for June 30, 2023, and 2022, respectively, of accumulated impairment in the Other category.

(2)Other included $17 million and $16 million for June 30, 2023, and 2022, respectively, of acquired intellectual property assets not yet being amortized as the related research and development projects have not yet been completed.

Amortization expense for intangible assets during the fiscal years 2023, 2022, and 2021 was $174 million, $180 million, and $182 million, respectively. During the last three fiscal years, there were no impairment charges recorded on intangible assets.

Estimated future amortization expense for intangible assets is as follows:

($ in millions)						Amortization
Fiscal year 2024						$	173
Fiscal year 2025						159
Fiscal year 2026						156
Fiscal year 2027						141
Fiscal year 2028						141

Note 11 - Fair Value Measurements

The fair values of the Company's financial assets and financial liabilities listed below reflect the amounts that would be received to sell the assets or paid to transfer the liabilities in an orderly transaction between market participants at the measurement date (exit price).

The Company's non-derivative financial instruments primarily include cash and cash equivalents, trade receivables, trade payables, short-term debt, and long-term debt. At June 30, 2023, and 2022, the carrying value of these financial instruments, excluding long-term debt, approximated fair value because of the short-term nature of these instruments.

Fair value disclosures are classified based on the fair value hierarchy. See Note 2, "Significant Accounting Policies," for information about the Company's fair value hierarchy.

The carrying value of long-term debt with variable interest rates approximates its fair value. The fair value of the Company's long-term debt with fixed interest rates is based on market prices, if available, or expected future cash flows discounted at the current interest rate for financial liabilities with similar risk profiles.

The carrying values and estimated fair values of long-term debt with fixed interest rates (excluding the fair value of designated receive-fixed/pay variable rate swaps) were as follows:

						June 30, 2023												June 30, 2022
						Carrying Value						Fair Value						Carrying Value						Fair Value
($ in millions)									(Level 2)									(Level 2)
Total long-term debt with fixed interest rates (excluding commercial paper (1) and finance leases)						$	4,123					$	3,844					$	3,952					$	3,694

(1)As of June 30, 2023, and 2022, the Company has entered into interest rate swap contracts for a total notional amount of commercial paper equal to $1.2 billion and nil, respectively. These contracts are considered to be economic hedges and the related $1.2 billion notional amount of commercial paper is also excluded from the total long-term debt with fixed interest rates.

Assets and Liabilities Measured and Recorded at Fair Value on a Recurring Basis

Additionally, the Company measures and records certain assets and liabilities, including derivative instruments and contingent purchase consideration liabilities, at fair value. The following table summarizes the fair value of these instruments, which are measured at fair value on a recurring basis, by level, within the fair value hierarchy:

						June 30, 2023
($ in millions)						Level 1						Level 2						Level 3						Total
Assets
Forward exchange contracts						—						3						—						3
Interest rate swaps						—						16						—						16
Total assets measured at fair value						$	—					$	19					$	—					$	19
Liabilities
Contingent purchase consideration liabilities						$	—					$	—					$	46					$	46
Commodity contracts						—						2						—						2
Forward exchange contracts						—						5						—						5
Interest rate swaps						—						96						—						96
Total liabilities measured at fair value						$	—					$	103					$	46					$	149

						June 30, 2022
($ in millions)						Level 1						Level 2						Level 3						Total
Assets
Commodity contracts						$	—					$	6					$	—					$	6
Forward exchange contracts						—						7						—						7
Total assets measured at fair value						$	—					$	13					$	—					$	13
Liabilities
Contingent purchase consideration liabilities						$	—					$	—					$	16					$	16
Commodity contracts						—						3						—						3
Forward exchange contracts						—						17						—						17
Interest rate swaps						—						69						—						69
Total liabilities measured at fair value						$	—					$	89					$	16					$	105

The fair value of the commodity contracts was determined using a discounted cash flow analysis based on the terms of the contracts and observed market forward prices discounted at a currency specific rate. Forward exchange contract fair values were determined based on quoted prices for similar assets and liabilities in active markets using inputs such as currency rates and forward points. The fair value of the interest rate swaps was determined using a discounted cash flow method based on market-based swap yield curves, taking into account current interest rates.

Contingent purchase consideration liabilities arise from business acquisitions and other investments. As of June 30, 2023, the Company has contingent purchase consideration liabilities of $46 million, mainly consisting of $33 million of contingent consideration relating to current period acquisitions (refer to Note 5, "Acquisitions and Divestitures") and a $10 million liability that is contingent on future royalty income generated by Discma AG, a subsidiary acquired in March 2017. The fair value of the contingent purchase consideration liabilities was determined for each arrangement individually. The fair value was determined using an income approach with significant inputs that are not observable in the market. Key assumptions include the selection of discount rates consistent with the level of risk of achievement and probability adjusted financial projections. The expected outcomes are recorded at net present value, which require adjustment over the life for changes in risks and probabilities. Changes arising from modifications in forecasts related to contingent consideration are expected to be immaterial.

The fair value of contingent purchase consideration liabilities is included in other current liabilities and other non-current liabilities in the consolidated balance sheets. The change in fair value of the contingent purchase consideration liabilities, which was included in other income, net is due to the passage of time and changes in the probability of achievement used to develop the estimate.

The following table sets forth a summary of changes in the value of the Company's Level 3 financial liabilities:

						June 30,
($ in millions)						2023						2022
Fair value at the beginning of the year						$	16					$	18
Additions due to acquisitions						33						—
Change in fair value of Level 3 liabilities						(2)						—
Payments						—						(1)
Foreign currency translation						(1)						(1)
Fair value at the end of the year						$	46					$	16

Assets and Liabilities Measured and Recorded at Fair Value on a Nonrecurring Basis

In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company records certain assets at fair value on a nonrecurring basis, generally when events or changes in circumstances indicate the carrying value may not be recoverable, or when they are deemed to be other than temporarily impaired. These assets include goodwill and other intangible assets, equity method and other investments, long-lived assets and disposal groups held for sale, and other long-lived assets. The fair values of these assets are determined, when applicable, based on valuation techniques using the best information

available, and may include quoted market prices, market comparables, and discounted cash flow projections. These nonrecurring fair value measurements are considered to be Level 3 in the fair value hierarchy.

As further discussed in Note 6, “Held for Sale,” during the fourth quarter of fiscal year 2022, the Company met the criteria to recognize the related assets and liabilities of its Russian operations as held for sale which resulted in the Company remeasuring the disposal group at its fair value, less cost to sell, which is considered a Level 3 fair value measurement.

In addition, resulting from the effective disposal of non-core businesses during the fiscal year ended June 30, 2022, the Company recorded a total loss of $34 million, predominantly to adjust the long-lived assets to their fair value less cost to sell. Of these losses, $24 million are included within restructuring, impairment, and other related activities, net as relating to the Russia-Ukraine conflict with the balance recorded in other income, net in the consolidated statements of income. During the fiscal year ended June 30, 2022, further long-lived assets with a carrying value of $12 million were written down to a fair value of zero as the Company's Durban, South Africa, manufacturing facility was destroyed in a fire as the result of general civil unrest. In addition, during the fiscal year ended June 30, 2022, other long-lived assets in South Africa, with a carrying amount of $8 million, were written down to their estimated fair value of $4 million using level 3 inputs. These expenses are included within other income, net in the consolidated statements of income.

Note 12 - Derivative Instruments

The Company periodically uses derivatives and other financial instruments to hedge exposures to interest rate, commodity price, and currency risks. The Company does not hold or issue derivative instruments for speculative or trading purposes. For hedges that meet the hedge accounting criteria, the Company, at inception, formally designates and documents the instruments as a fair value hedge or a cash flow hedge of a specific underlying exposure. On an ongoing basis, the Company assesses and documents that its hedges have been and are expected to continue to be highly effective.

Interest Rate Risk

The Company's policy is to manage exposure to interest rate risk by maintaining a mixture of fixed-rate and variable-rate debt, monitoring global interest rates, and, where appropriate, hedging floating interest rate exposure or debt at fixed interest rates through various interest rate derivative instruments, including, but not limited to, interest rate swaps, cross-currency interest rate swaps, and interest rate locks. For interest rate swaps that are accounted for as fair value hedges, the gains and losses related to the changes in the fair value of the interest rate swaps are included in interest expense and offset changes in the fair value of the hedged portion of the underlying debt that are attributable to the changes in market interest rates. Changes in the fair value of interest rate swaps that have not been designated as hedging instruments are reported in the accompanying consolidated statements of income in other income, net.

In October 2022, the Company entered into interest rate swap contracts for a total notional amount of $1.25 billion. Under the terms of the contracts, the Company paid a weighted-average fixed rate of interest of 4.53% and received a variable rate of interest, based on compound overnight SOFR, for the period from November 2022 through June 2023, settled monthly. In March 2023, the Company entered into interest rate swap contracts for a total notional amount of $1.2 billion. Under the terms of the contracts, the Company will pay a weighted-average fixed interest rate of 3.88% and receives a variable rate of interest, based on 1-month Term SOFR, from July 2023 through June 2024, settled monthly. As of June 30, 2023, the Company had no other receive-variable/pay-fixed interest rate swaps than those listed above. As of June 30, 2022, the Company had no receive-variable/pay-fixed interest rate swaps. Although the Company is not applying hedge accounting, the Company believes that these economic hedging instruments are effective in protecting the Company against the risks of changes in the variable interest rate on a portion of its forecasted commercial paper issuances.

As of June 30, 2023, and 2022, the total notional amount of the Company's receive-fixed/pay-variable interest rate swaps was $650 million.

Foreign Currency Risk

The Company manufactures and sells its products and finances operations in a number of countries throughout the world and, as a result, is exposed to movements in foreign currency exchange rates. The purpose of the Company's foreign currency hedging program is to manage the volatility associated with the changes in exchange rates.

To manage this exchange rate risk, the Company utilizes forward contracts. Contracts that qualify for hedge accounting are designated as cash flow hedges of certain forecasted transactions denominated in foreign currencies. The effective portion of the changes in fair value of these instruments is reported in accumulated other comprehensive loss ("AOCI") and reclassified into earnings in the same financial statement line item and in the same period or periods during which the related hedged transactions affect earnings. The ineffective portion is recognized in earnings over the life of the hedging relationship in the same consolidated statements of income line item as the underlying hedged item. Changes in the fair value of forward contracts that have not been designated as hedging instruments are reported in the accompanying consolidated statements of income.

As of June 30, 2023, and 2022, the notional amount of the outstanding forward contracts was $0.5 billion and $1.0 billion, respectively.

Commodity Risk

Certain raw materials used in the Company's production processes are subject to price volatility caused by weather, supply conditions, political and economic variables, and other unpredictable factors. The Company's policy is to minimize exposure to price volatility by passing through the commodity price risk to customers, including through the use of fixed price swaps.

In some cases, the Company purchases, on behalf of customers, fixed price commodity swaps to offset the exposure of price volatility on the underlying sales contracts. These instruments are cash closed out on maturity and the related cost or benefit is passed through to customers. Information about commodity price exposure is derived from supply forecasts submitted by customers and these exposures are hedged by central treasury units. Changes in the fair value of commodity hedges are recognized in AOCI. The cumulative amount of the hedge is recognized in the consolidated statements of income when the forecasted transaction is realized.

The Company had the following outstanding commodity contracts to hedge forecasted purchases:

						June 30, 2023						June 30, 2022
Commodity						Volume						Volume
Aluminum						14,325 tons						17,040 tons
PET resin						0 lbs.						16,886,520 lbs.

The following table provides the location of derivative instruments in the consolidated balance sheets:

($ in millions)						Balance Sheet Location						June 30, 2023						June 30, 2022
Assets
Derivatives in cash flow hedging relationships:
Commodity contracts						Other current assets						$	—					$	6
Forward exchange contracts						Other current assets						2						3
Forward exchange contracts						Assets held for sale, net						—						3
Derivatives not designated as hedging instruments:
Forward exchange contracts						Other current assets						1						1
Interest rate swaps						Other current assets						16						—
Total current derivative contracts												19						13
Total non-current derivative contracts												—						—
Total derivative asset contracts												$	19					$	13
Liabilities
Derivatives in cash flow hedging relationships:
Commodity contracts						Other current liabilities						$	2					$	3
Forward exchange contracts						Other current liabilities						3						5
Derivatives not designated as hedging instruments:
Forward exchange contracts						Other current liabilities						1						11
Total current derivative contracts												6						19
Derivatives in cash flow hedging relationships:
Forward exchange contracts						Other non-current liabilities						1						1
Derivatives in fair value hedging relationships:
Interest rate swaps						Other non-current liabilities						96						69
Total non-current derivative contracts												97						70
Total derivative liability contracts												$	103					$	89

Certain derivative financial instruments are subject to netting arrangements and are eligible for offset. The Company has made an accounting policy election not to offset the fair values of these instruments within the consolidated balance sheets.

The following tables provide the effects of derivative instruments on AOCI and in the consolidated statements of income:

						Location of Gain / (Loss) Reclassified from AOCI into Income (Effective Portion)						Gain / (Loss) Reclassified from AOCI into Income (Effective Portion)
									Years ended June 30,
($ in millions)									2023						2022						2021
Derivatives in cash flow hedging relationships
Commodity contracts						Cost of sales						$	2					$	20					$	1
Forward exchange contracts						Net sales						(2)						—						—
Treasury locks						Interest expense						(3)						(3)						(2)
Total												$	(3)					$	17					$	(1)

						Location of Gain / (Loss) Recognized in the Consolidated Income Statements						Gain / (Loss) Recognized in Income for Derivatives not Designated as Hedging Instruments
									Years ended June 30,
($ in millions)									2023						2022						2021
Derivatives not designated as hedging instruments
Forward exchange contracts						Other income, net						$	(7)					$	(45)					$	11
Interest rate swaps						Other income, net						16						—						—
Cross currency interest rate swaps						Other income, net						—						—						(4)
Total												$	9					$	(45)					$	7

						Location of Loss Recognized in the Consolidated Income Statements						Loss Recognized in Income for Derivatives in Fair Value Hedging Relationships
									Years ended June 30,
($ in millions)									2023						2022						2021
Derivatives in fair value hedging relationships
Interest rate swaps						Interest expense						$	(27)					$	(75)					$	(14)
Forward exchange contracts						Other income, net						—						(11)						—
Total												$	(27)					$	(86)					$	(14)

The changes in AOCI for effective derivatives were as follows:

						Years ended June 30,
($ in millions)						2023						2022						2021
Amounts reclassified into earnings
Commodity contracts						$	(2)					$	(20)					$	(1)
Forward exchange contracts						2						—						—
Treasury locks						3						3						2
Change in fair value
Commodity contracts						(2)						9						22
Forward exchange contracts						(3)						(1)						3
Tax effect						1						2						—
Total						$	(1)					$	(7)					$	26

Note 13 - Pension Plans

The Company sponsors both funded and unfunded defined benefit pension plans that include a statutory and mandated benefit provision in various countries as well as voluntary plans (generally closed to new joiners). During fiscal year 2023, the Company maintained approximately 20 statutory and mandated defined benefit arrangements and approximately 50 voluntary defined benefit plans. The Company’s principal defined benefit plans are in the United States, Switzerland, United Kingdom, and Germany. The majority of the principal defined benefit plans are closed to new entrants and future accruals, and the majority of these plans are funded.

During the fourth quarter of fiscal year 2023, Amcor announced a plan termination date of July 31, 2023, for one of the Company's closed principal defined benefit plans in the United States (the "U.S. Plan"). Benefit obligations related to the U.S. Plan of $265 million are expected to be distributed through a combination of lump sum payments to eligible plan participants who elect such payments, and through the purchase of group annuity contracts for the remaining participants. The U.S. Plan's benefit obligations as of June 30, 2023 were determined on a plan termination basis, assuming that a portion of eligible active and deferred vested participants will elect lump sum payments. The U.S. Plan is expected to have sufficient plan assets to satisfy the majority of the transaction obligations. Distributions are expected to begin in fiscal year 2025, which will likely trigger settlement accounting.

During the second quarter of fiscal year 2022, the Company contracted with Pacific Life Insurance Company to purchase a group annuity contract and transfer $186 million of its pension plan assets and related benefit obligations related to three principal defined benefit plans in the United States. This transaction required a remeasurement of the pension plan assets and obligations and resulted in the recognition of a $3 million non-cash pension settlement loss in fiscal year 2022.

Net periodic benefit cost for benefit plans includes the following components:

						Years ended June 30,
($ in millions)						2023						2022						2021
Service cost						$	13					$	24					$	27
Interest cost						49						39						40
Expected return on plan assets						(55)						(61)						(60)
Amortization of net loss						2						5						8
Amortization of prior service credit						(3)						(3)						(2)
Curtailment credit						—						—						(1)
Settlement costs						5						8						3
Net periodic benefit cost						$	11					$	12					$	15

Changes in benefit obligations and plan assets were as follows:

($ in millions)						June 30, 2023						June 30, 2022
Change in benefit obligation:
Benefit obligation at the beginning of the year						$	1,314					$	2,022
Service cost						13						24
Interest cost						49						39
Participant contributions						6						6
Actuarial gain						(90)						(341)
Settlements						(27)						(244)
Benefits paid						(62)						(70)
Administrative expenses						(4)						(6)
Plan amendments						(4)						1
Divestitures						—						(4)
Other						(2)						—
Foreign currency translation						31						(113)
Benefit obligation at the end of the year						$	1,224					$	1,314
Accumulated benefit obligation at the end of the year						$	1,186					$	1,269

Change in plan assets:
Fair value of plan assets at the beginning of the year						$	1,195					$	1,759
Actual return on plan assets						(100)						(189)
Employer contributions						26						35
Participant contributions						6						6
Benefits paid						(62)						(70)
Settlements						(27)						(244)
Administrative expenses						(4)						(6)
Foreign currency translation						27						(96)
Fair value of plan assets at the end of the year						$	1,061					$	1,195
Funded status at the end of the year						$	(163)					$	(119)

Actuarial gains resulting in a decrease of the benefit obligation were primarily due to a weighted average increase in discount rates for the Company's pension plans of 0.5% and 1.7% for the fiscal years ended June 30, 2023, and June 30, 2022, respectively. Settlement impact for the fiscal year ended June 30, 2022, is attributed to group annuity contracts, primarily a $186 million contract with Pacific Life Insurance Company, and other lump sum transfers and payments.

The following table provides information for defined benefit plans with a projected benefit obligation in excess of plan assets:

($ in millions)						June 30, 2023						June 30, 2022
Projected benefit obligation						$	832					$	398
Fair value of plan assets						601						189

The following table provides information for defined benefit plans with an accumulated benefit obligation in excess of plan assets:

($ in millions)						June 30, 2023						June 30, 2022
Accumulated benefit obligation						$	799					$	357
Fair value of plan assets						589						177

The following table provides information as to how the funded status is recognized in the consolidated balance sheets:

($ in millions)						June 30, 2023						June 30, 2022
Non-current assets - Employee benefit assets						$	67					$	89
Current liabilities - Other current liabilities						(6)						(7)
Non-current liabilities - Employee benefit obligations						(224)						(201)
Funded status						$	(163)					$	(119)

Amounts recognized in other comprehensive (income)/loss for the fiscal years ended are as follows:

						Years ended June 30,
($ in millions)						2023						2022						2021
Changes in plan assets and benefit obligations recognized in other comprehensive (income)/loss:
Net actuarial loss/(gain) occurring during the year						$	65					$	(91)					$	(58)
Net prior service loss/(gain) occurring during the year						(4)						1						(16)
Amortization of actuarial loss						(2)						(5)						(8)
Gain recognized due to settlement/curtailment						(4)						(8)						(2)
Amortization of prior service credit						3						3						2
Acquisition/disposal loss						—						(1)						—
Foreign currency translation						3						(14)						16
Tax effect						(11)						21						14
Total recognized in other comprehensive (income)/loss						$	50					$	(94)					$	(52)

Amounts in AOCI that have not yet been recognized as net periodic benefit cost, as of fiscal year-ends, are as follows:

						June 30,
($ in millions)						2023						2022						2021
Net prior service credit						$	(17)					$	(15)					$	(20)
Net actuarial loss						128						65						185
Accumulated other comprehensive loss at the end of the year						$	111					$	50					$	165

Weighted-average assumptions used to determine benefit obligations at fiscal year-ends were:

						June 30,
						2023						2022						2021
Discount rate						4.3		%				3.8		%				2.1		%
Rate of compensation increase						1.9		%				2.3		%				1.7		%

Weighted-average assumptions used to determine net periodic benefit cost for the fiscal years ended were:

						June 30,
						2023						2022						2021
Discount rate						3.8		%				2.1		%				2.0		%
Rate of compensation increase						2.3		%				1.7		%				1.9		%
Expected long-term rate of return on plan assets						4.4		%				3.8		%				3.5		%

Where funded, the Company and, in some countries, the employees make cash contributions into the pension fund. In the case of unfunded plans, the Company is responsible for benefit payments as they fall due. Plan funding requirements are generally determined by local regulation and/or best practice and differ between countries. The local statutory funding positions are not necessarily consistent with the funded status disclosed on the consolidated balance sheets. For any funded plans in deficit (as measured under local country guidelines), the Company agrees with the trustees and plan fiduciaries to undertake

suitable funding programs to provide additional contributions over time in accordance with local country requirements. Contributions to the Company's defined benefit pension plans, not including unfunded plans, are expected to be $29 million over the next fiscal year.

The following benefit payments for the succeeding five fiscal years and thereafter, which reflect expected future service, as appropriate, are expected to be paid:

($ in millions)
2024						$	72
2025						320
2026						56
2027						56
2028						58
2029-2033						308

The fiscal year 2025 benefit payments include the expected distributions associated with the plan termination announced for the U.S. Plan.

The ERISA Benefit Plan Committee in the United States, the Pension Plan Committee in Switzerland, and the Trustees of the pension plans in UK establish investment policies, investment strategies, allocation strategies, and investment risk profiles for the Company's pension plan assets and are required to consult with the Company on changes to their investment policy. In developing the expected long-term rate of return on plan assets at each measurement date, the Company considers the plan assets' historical returns, asset allocations, and the anticipated future economic environment and long-term performance of the asset classes. While appropriate consideration is given to recent and historical investment performance, the assumption represents management's best estimate of the long-term prospective return.

The pension plan assets measured at fair value were as follows:

						June 30, 2023
($ in millions)						Level 1						Level 2						Level 3						Total
Equity securities						$	114					$	54					$	—					$	168
Debt securities						77						405						—						482
Real estate						7						105						—						112
Insurance contracts						—						—						192						192
Cash and cash equivalents						58						13						—						71
Other						5						22						9						36
Total						$	261					$	599					$	201					$	1,061

						June 30, 2022
($ in millions)						Level 1						Level 2						Level 3						Total
Equity securities						$	111					$	98					$	—					$	209
Debt securities (1)						73						378						—						451
Real estate						7						121						2						130
Insurance contracts						—						—						216						216
Cash and cash equivalents						21						3						—						24
Other						5						26						134						165
Total						$	217					$	626					$	352					$	1,195

(1)Certain prior year amounts were reclassified to conform to current year presentation.

Equity securities: Valued primarily at the closing prices reported in the active market in which the individual securities are traded (Level 1); or based on significant observable inputs such as fund values provided by the independent fund administrators (Level 2).

Debt securities: Consists of government and corporate debt securities. Valued at the closing prices reported in the active market in which the individual securities are traded (Level 1); or based on observable inputs such as fund values provided by independent fund administrators, pricing of similar agency issues, reported trades, broker/dealer quotes, issuer spread, live trading feeds from several vendors, and benchmark yields (Level 2). Inputs may be prioritized differently at certain times based on market conditions.

Real estate: Valued at the closing prices reported in the active market in which the individual securities are traded (Level 1); or based on observable inputs such as fund values provided by independent fund administrators (Level 2).

Insurance contracts: Valued based on the present value of the underlying insured liabilities (Level 3).

Cash and cash equivalents: Consist of cash on deposit with brokers and short-term money market funds and are shown net of receivables and payables for securities traded at period end but not yet settled (Level 1) and cash indirectly held across investment funds (Level 2). All cash and cash equivalents are stated at cost, which approximates fair value.

Other:

Level 1: Derivatives valued as closing prices reported in the active market.

Level 2: Assets held in diversified growth funds, pooled funds, financing funds, and derivatives, where the values of the assets are determined by the investment managers or other independent third parties, based on observable inputs.

Level 3: Indemnified plan assets and pooled funds (equity, credit, macro-orientated, multi-strategy, cash, and other). The values of indemnified plan assets are determined based on the value of the liabilities that the assets cover. The value of the pooled funds is calculated by the investment managers based on the net asset values of the underlying portfolios.

The following table sets forth a summary of changes in the value of the Company's Level 3 assets:

($ in millions)
Balance as of June 30, 2022						$	352
Actual return on plan assets						(51)
Purchases, sales, and settlements						(8)
Transfer out of Level 3 (1)						(93)
Foreign currency translation						1
Balance as of June 30, 2023						$	201

(1)In preparation for a buy-in policy contract that was executed in July 2023, the Company transferred certain Level 3 assets into Level 1 assets and Level 2 assets in fiscal year 2023. Refer to Note 24, "Subsequent Events," for further information.

Note 14 - Debt

Long-Term Debt

The following table summarizes the carrying value of long-term debt as of June 30, 2023, and 2022, respectively:

															June 30,
($ in millions)			Maturities						Interest rates						2023						2022
Term debt
Euro bonds, €300 million (1)(3)			Mar 2023						2.75		%				$	—					$	313
U.S. dollar notes, $500 million			May 2025						4.00		%				500						500
U.S. dollar notes, $600 million			Apr 2026						3.63		%				600						600
U.S. dollar notes, $300 million			Sep 2026						3.10		%				300						300
Euro bonds, €500 million			Jun 2027						1.13		%				543						522
U.S. dollar notes, $500 million			May 2028						4.50		%				500						500
U.S. dollar notes, $500 million			Jun 2030						2.63		%				500						500
U.S. dollar notes, $800 million			May 2031						2.69		%				800						800
U.S. dollar notes, $500 million (4)			May 2033						5.63		%				500						—
Total term debt															4,243						4,035
Bank loans															22						22
Commercial paper (1)															2,445						2,310
Other loans (2)															33						18
Finance lease obligations															50						62
Fair value hedge accounting adjustments (5)															(96)						(69)
Unamortized discounts and debt issuance costs															(31)						(24)
Total debt															6,666						6,354
Less: current portion															(13)						(14)
Total long-term debt															$	6,653					$	6,340

(1)Indicates debt which has been classified as long-term liabilities in accordance with the Company’s ability and intent to refinance such obligations on a long-term basis.

(2)Includes other loans of $12 million and nil for June 30, 2023, and 2022, respectively, which have been classified as long-term liabilities in accordance with the Company’s ability and intent to refinance such obligations on a long-term basis.

(3)On March 22, 2023, the Company redeemed Euro bonds of €300 million at maturity. The redemption was funded with commercial paper.

(4)On May 26, 2023, the Company issued U.S. dollar notes with an aggregate principal amount of $500 million and a contractual maturity in May 2033. The notes pay a coupon of 5.63% per annum, payable semi-annually in arrears. The notes are unsecured senior obligations of the Company and are fully and unconditionally guaranteed by the Company and certain of its subsidiaries.

(5)Relates to fair value hedge basis adjustments relating to interest rate hedging.

The following table summarizes the contractual maturities of the Company's long-term debt, including current maturities (excluding payments for finance leases) as of June 30, 2023, for the succeeding five fiscal years:

($ in millions)
2024						$	3
2025 (1)						1,933
2026						600
2027 (2)						1,867
2028						504

(1) Commercial paper denominated in U.S. dollars is classified as maturing in 2025, supported by the 3-year syndicated facility, with a 1-year option to extend.

(2) Commercial paper denominated in Euros is classified as maturing in 2027, supported by the 5-year syndicated facility, with a 1-year option to extend.

Bank and other loans

The Company has entered into syndicated and bilateral multi-currency credit facilities with financial institutions. On April 26, 2022, the Company entered into three- and five-year syndicated facility agreements that each provide a revolving credit facility of $1.9 billion or $3.8 billion in total. The facilities are unsecured and have contractual maturities in April 2025 and April 2027, respectively. The agreements include customary terms and conditions for a syndicated facility of this nature, and the revolving tranches have two 12-month options available to extend the maturity date.

Interest charged on borrowings under the credit facilities is based on the applicable market rate plus the applicable margin. As of June 30, 2023, and 2022, the Company's credit facilities amounted to $3.8 billion.

As of June 30, 2023, and 2022, the Company has $1.3 billion and $1.4 billion of undrawn commitments, respectively. The Company incurs facility fees of 0.125% on the undrawn commitments. Such facility fees incurred were immaterial in the fiscal years ended June 30, 2023, 2022, and 2021, respectively.

As of June 30, 2023, and 2022, land and buildings with a carrying value of $38 million have been pledged as security for bank and other loans.

Redemption of term debt

The Company may redeem its long-term debt, in whole or in part, at any time or from time to time prior to its maturity. The redemption prices typically represent 100% of the principal amount of the relevant debt plus any accrued and unpaid interest. In addition, for notes that are redeemed by the Company before their stated permitted redemption date, a make-whole premium is payable.

On March 22, 2023, the Company redeemed Euro bonds of €300 million (equivalent to $322 million) at maturity. The redemption was funded with commercial paper. The notes carried an interest rate of 2.75%.

Priority, Guarantees, and Financial Covenants

All the notes are general unsecured senior obligations of the Company and are fully and unconditionally guaranteed on a joint and several basis by certain existing subsidiaries that guarantee its other indebtedness.

The Company's primary bank debt facilities and notes are unsecured and subject to negative pledge arrangements limiting the amount of secured indebtedness the Company can incur to 10.0% of total tangible assets, subject to some exceptions and variations by facility. The Company is required to satisfy certain financial covenants pursuant to its bank debt facilities, which are tested as of the last day of each quarterly and annual financial period. The covenants require the Company to maintain a leverage ratio of not higher than 3.9 times, which is calculated as total net debt divided by Adjusted EBITDA. As of June 30, 2023, and 2022, the Company was in compliance with all debt covenants.

Short-Term Debt

Short-term debt is generally used to fund working capital requirements. The Company has classified commercial paper as long-term as of June 30, 2023, in accordance with the Company’s ability and intent to refinance such obligations on a long-term basis.

The following table summarizes the carrying value of short-term debt as of June 30, 2023, and 2022, respectively:

						June 30,
($ in millions)						2023						2022
Bank loans						$	13					$	32
Bank overdrafts						67						104
Total short-term debt						$	80					$	136

As of June 30, 2023, the Company paid a weighted-average interest rate of 3.98% per annum on short-term debt, payable at maturity. As of June 30, 2022, the Company paid a weighted-average interest rate of 1.40% per annum, payable at maturity.

Note 15 - Leases

The components of lease expense are as follows:

						Years ended June 30,
($ in millions)						2023						2022						2021
Operating lease expense (1)						$	127					$	130					$	113
Short-term and variable lease expense (2)						21						17						20
Finance lease expense
Amortization of right-of-use assets (2)						4						2						2
Interest on lease liabilities (3)						2						1						1
Total lease expense						$	154					$	150					$	136

(1)Included in both cost of sales and selling, general, and administrative expenses

(2)Included primarily in cost of sales

(3)Included in interest expense

The Company's leases do not contain any material residual value guarantees or material restrictive covenants. As of June 30, 2023, the Company does not have material lease commitments that have not commenced.

Supplemental balance sheet information related to leases:

												June 30,
($ in millions)						Balance Sheet Location						2023						2022
Assets
Operating lease right-of-use assets, net						Operating lease assets						$	533					$	560
Finance lease assets (1)						Property, plant, and equipment, net						57						62
Total lease assets												$	590					$	622
Liabilities
Operating leases:
Current operating lease liabilities						Other current liabilities						$	101					$	101
Non-current operating lease liabilities						Operating lease liabilities						463						493
Finance leases:
Current finance lease liabilities						Current portion of long-term debt						10						10
Non-current finance lease liabilities						Long-term debt, less current portion						40						52
Total lease liabilities												$	614					$	656

(1)Finance lease assets are recorded net of accumulated amortization of $12 million and $9 million as of June 30, 2023 and 2022, respectively.

Supplemental cash flow information related to leases:

						Years ended June 30,
($ in millions)						2023						2022						2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases						$	118					$	122					$	111
Operating cash flows from finance leases						2						1						1
Financing cash flows from finance leases						11						5						2
Lease assets obtained in exchange for new lease obligations:
Operating leases						$	26					$	55					$	55
Finance leases						—						34						1
Other non-cash modifications to lease assets:
Operating leases						33						88						56

The following table presents the maturities of the Company's lease liabilities recorded on the consolidated balance sheets as of June 30, 2023:

($ in millions)						Operating Leases						Finance Leases
Fiscal year 2024						$	115					$	11
Fiscal year 2025						99						11
Fiscal year 2026						89						6
Fiscal year 2027						74						2
Fiscal year 2028						63						2
Thereafter						218						26
Total lease payments						658						58
Less: imputed interest						(94)						(8)
Total lease liabilities						$	564					$	50

The weighted-average remaining lease term and discount rate are as follows:

						June 30,
						2023						2022
Weighted-average remaining lease term (in years):
Operating leases						8.0						9.0
Finance leases						10.3						10.1
Weighted-average discount rate:
Operating Leases						3.6		%				3.3		%
Finance leases						3.0		%				2.9		%

Note 16 - Shareholders' Equity

The changes in ordinary and treasury shares during fiscal years 2023, 2022, and 2021, were as follows:

						Ordinary Shares												Treasury Shares
(shares and $ in millions)						Number of Shares						Amount						Number of Shares						Amount
Balance as of June 30, 2020						1,569						$	16					7						$	(67)
Share buyback/cancellations						(31)						(1)						—						—
Options exercised and shares vested						—						—						(5)						46
Purchase of treasury shares						—						—						1						(8)
Balance as of June 30, 2021						1,538						15						3						(29)
Share buyback/cancellations						(49)						—						—						—
Options exercised and shares vested						—						—						(13)						154
Purchase of treasury shares						—						—						12						(143)
Balance as of June 30, 2022						1,489						15						2						(18)
Share buyback/cancellations						(41)						(1)						—						—
Options exercised and shares vested						—						—						(19)						227
Purchase of treasury shares						—						—						18						(221)
Balance as of June 30, 2023						1,448						$	14					1						$	(12)

The changes in the components of accumulated other comprehensive loss during the fiscal years ended June 30, 2023, 2022, and 2021 were as follows:

						Foreign Currency Translation						Net Investment Hedge						Pension						Effective Derivatives						Total Accumulated Other Comprehensive Loss
($ in millions)						(Net of Tax)						(Net of Tax)						(Net of Tax)						(Net of Tax)
Balance as of June 30, 2020						$	(896)					$	(13)					$	(106)					$	(34)					$	(1,049)
Other comprehensive income before reclassifications						179						—						44						25						248
Amounts reclassified from accumulated other comprehensive loss						26						—						8						1						35
Net current period other comprehensive income						205						—						52						26						283
Balance as of June 30, 2021						(691)						(13)						(54)						(8)						(766)
Other comprehensive income / (loss) before reclassifications						(220)						—						85						6						(129)
Amounts reclassified from accumulated other comprehensive loss						19						—						9						(13)						15
Net current period other comprehensive income / (loss)						(201)						—						94						(7)						(114)
Balance as of June 30, 2022						(892)						(13)						40						(15)						(880)
Other comprehensive loss before reclassifications						(9)						—						(53)						(4)						(66)
Amounts reclassified from accumulated other comprehensive loss						78						—						3						3						84
Net current period other comprehensive income/(loss)						69						—						(50)						(1)						18
Balance as of June 30, 2023						$	(823)					$	(13)					$	(10)					$	(16)					$	(862)

The following tables provide details of amounts reclassified from accumulated other comprehensive loss:

						For the years ended June 30,
($ in millions)						2023						2022						2021
Amortization of pension:
Amortization of prior service credit						$	(3)					$	(3)					$	(2)
Amortization of actuarial loss						2						5						8
Acquisition/disposal loss						—						1						—
Effect of pension settlement/curtailment						4						8						2
Total before tax effect						3						11						8
Tax effect on amounts reclassified into earnings						—						(2)						—
Total net of tax						$	3					$	9					$	8
(Gains)/losses on cash flow hedges:
Commodity contracts						$	(2)					$	(20)					$	(1)
Forward exchange contracts						2						—						—
Treasury locks						3						3						2
Total before tax effect						3						(17)						1
Tax effect on amounts reclassified into earnings						—						4						—
Total net of tax						$	3					$	(13)					$	1
Losses on foreign currency translation:
Foreign currency translation adjustment (1)						$	78					$	19					$	26
Total before tax effect						78						19						26
Tax effect on amounts reclassified into earnings						—						—						—
Total net of tax						$	78					$	19					$	26

(1)During the fiscal year ended June 30, 2023, the Company disposed of its Russian business and certain non-core operations and transferred $73 million and $5 million, respectively, of accumulated foreign currency translation from accumulated other comprehensive loss to earnings. During the fiscal year ended June 30, 2022, the Company effectively disposed of a non-core business and transferred $19 million of accumulated foreign currency translation from accumulated other comprehensive loss to earnings. During the fiscal year ended June 30, 2021, the Company recorded a gain on disposal of AMVIG and other non-core businesses. Upon completion of the transactions, $26 million of accumulated foreign currency translation was transferred from accumulated other comprehensive loss to earnings. Refer to Note 5, "Acquisitions and Divestitures," and Note 8, "Equity Method and Other Investments," for further information.

Forward contracts to purchase own shares

The Company's employee share plans require the delivery of shares to employees in the future when rights vest or vested options are exercised. The Company currently acquires shares on the open market to deliver shares to employees to satisfy vesting or exercising commitments. This exposes the Company to market price risk.

To manage the market price risk, the Company has entered into forward contracts for the purchase of its ordinary shares. As of June 30, 2023, the Company has entered into forward contracts that mature between September 2023 and November 2023 to purchase 9 million shares at a weighted average price of $12.39. As of June 30, 2022, the Company had outstanding forward contracts for 14 million shares at a weighted average price of $12.67 that matured between November 2022 and June 2023.

The forward contracts to purchase the Company's own shares are classified as a current liability. Equity is reduced by an amount equal to the fair value of the shares at inception. The carrying value of the forward contracts at each reporting period was determined based on the present value of the cost required to settle the contracts.

Note 17 - Income Taxes

Amcor plc is a tax resident of the United Kingdom of Great Britain and Northern Ireland ("UK").

The components of income before income taxes and equity in income of affiliated companies were as follows:

						Years ended June 30,
($ in millions)						2023						2022						2021
Domestic (UK)						$	82					$	(58)					$	(25)
Foreign						1,169						1,173						1,218
Total income before income taxes and equity in income of affiliated companies						$	1,251					$	1,115					$	1,193

Income tax expense consisted of the following:

						Years ended June 30,
($ in millions)						2023						2022						2021
Current tax
Domestic (UK)						$	3					$	2					$	11
Foreign						247						331						246
Total current tax						250						333						257
Deferred tax
Domestic (UK)						(6)						(10)						(1)
Foreign						(51)						(23)						5
Total deferred tax						(57)						(33)						4
Income tax expense						$	193					$	300					$	261

The following is a reconciliation of income tax computed at the UK statutory tax rate of 20.5%, 19.0%, and 19.0% for fiscal years 2023, 2022, and 2021, respectively, to income tax expense.

						Years ended June 30,
($ in millions)						2023						2022						2021
Income tax expense at statutory rate						$	256					$	212					$	227
Foreign tax rate differential						54						43						18
Capital gain on the sale of the Russian business						(63)						—						—
Non-deductible expenses, non-taxable items, net						16						(2)						2
Change in valuation allowance						(7)						4						40
Uncertain tax positions, net						(39)						62						32
Other (1)						(24)						(19)						(58)
Income tax expense						$	193					$	300					$	261

(1)In fiscal year 2023, Other is comprised of effects of foreign currency exchange of $25 million, adjustments to prior year, movement in deferred tax positions, changes in tax rate, and other individually immaterial items. In fiscal year 2022, Other is comprised of adjustments to prior year, movements in deferred tax positions of $13 million, changes in tax rates, and other individually immaterial items. In fiscal year 2021, Other is comprised of adjustments to prior fiscal year, including one related to the crystallization of benefits from business restructuring of $45 million, changes in tax rate, and other individually immaterial items.

Amcor operates in over forty different jurisdictions with a wide range of statutory tax rates. The tax expense from operating in non-UK jurisdictions in excess of the UK statutory tax rate is included in the line "Foreign tax rate differential" in the above tax rate reconciliation table. For fiscal year 2023, the Company's effective tax rate was 15.4% as compared to the effective tax rates of 26.9% and 21.9% for fiscal years 2022 and 2021, respectively. The lower effective tax rate for fiscal year 2023 is largely attributable to the non-taxable gain on the disposal of the Russian business and the release of provisions for uncertain tax positions related to the disposed Russian business. The increase in fiscal year 2022 compared to fiscal year 2021 was predominantly attributable to an increase in tax provisions for uncertain tax positions.

Significant components of deferred tax assets and liabilities are as follows:

						June 30,
($ in millions)						2023						2022
Deferred tax assets
Inventories						$	20					$	15
Accrued employee benefits						70						62
Provisions						4						18
Net operating loss carryforwards						332						325
Tax credit carryforwards						37						39
Accruals and other						46						48
Total deferred tax assets						509						507
Valuation allowance						(400)						(407)
Net deferred tax assets						109						100
Deferred tax liabilities
Property, plant, and equipment						(294)						(319)
Other intangible assets						(259)						(304)
Derivatives and other financial instruments						(25)						(4)
Undistributed foreign earnings						(13)						(20)
Total deferred tax liabilities						(591)						(647)
Net deferred tax liability						(482)						(547)
Balance sheet location:
Deferred tax assets						134						130
Deferred tax liabilities						(616)						(677)
Net deferred tax liability						$	(482)					$	(547)

The Company maintains a valuation allowance on net operating losses and other deferred tax assets in jurisdictions for which it does not believe it is more likely than not to realize those deferred tax assets based upon all available positive and negative evidence, including historical operating performance, carry-back periods, reversal of taxable temporary differences, tax planning strategies, and earnings expectations. The Company's valuation allowance decreased by $7 million, increased by $4 million, and increased by $40 million for fiscal years 2023, 2022, and 2021, respectively.

As of June 30, 2023, and 2022, the Company had total net operating loss carry forwards, including capital losses, in the amount of $1.3 billion and $1.2 billion, respectively, and tax credits of $37 million and $39 million, respectively. The vast majority of the losses and tax credits do not expire.

The Company considers the following factors, among others, in evaluating its plans for indefinite reinvestment of its subsidiaries' earnings: (i) the forecasts, budgets, and financial requirements of the Company and its subsidiaries, both for the long-term and for the short-term; and (ii) the tax consequences of any decision to repatriate or reinvest earnings of any subsidiary. As of June 30, 2023, the Company has not provided deferred taxes on approximately $1.3 billion of earnings in certain foreign subsidiaries because such earnings are indefinitely reinvested in its international operations. Upon distribution of such earnings in the form of dividends or otherwise, the Company may be subject to incremental foreign tax. It is not practicable to estimate the amount of foreign tax that might be payable. As of June 30, 2023, a cumulative deferred tax liability of $13 million has been recorded attributable to undistributed earnings that the Company has deemed are not indefinitely reinvested. The remaining undistributed earnings of the Company's subsidiaries are not deemed to be indefinitely reinvested and can be repatriated at no tax cost. Accordingly, there is no provision for income or withholding taxes on these earnings.

The Company accounts for its uncertain tax positions in accordance with ASC 740, "Income Taxes." At June 30, 2023, and 2022, unrecognized tax benefits totaled $155 million and $195 million, respectively, all of which would favorably impact the effective tax rate if recognized.

The Company recognizes interest and penalties accrued related to unrecognized tax benefits in income tax expense. As of June 30, 2023, 2022, and 2021, the Company's accrual for interest and penalties for these uncertain tax positions was $13

million, $12 million, and $12 million, respectively. The Company does not currently anticipate that the total amount of unrecognized tax benefits will result in material changes to its financial position within the next 12 months.

A reconciliation of the beginning and ending amount of unrecognized tax benefits for the fiscal years presented is as follows:

						June 30,
($ in millions)						2023						2022						2021
Balance at the beginning of the year						$	195					$	133					$	101
Additions based on tax positions related to the current year						12						50						39
Additions for tax positions of prior years						24						19						7
Reductions for tax positions from prior years						(69)						(6)						(12)
Reductions for settlements						(5)						—						—
Reductions due to lapse of statute of limitations						(2)						(1)						(2)
Balance at the end of the year						$	155					$	195					$	133

The Company conducts business in a number of tax jurisdictions and, as such, is required to file income tax returns in multiple jurisdictions globally. The fiscal years 2017 through 2022 remain open for examination by the United States Internal Revenue Service ("IRS"), the fiscal year 2021 remains open for examination by His Majesty’s Revenue & Customs ("HMRC"), and the fiscal years 2011 through 2022 are currently subject to audit or remain open for examination in various tax jurisdictions.

The Company believes that its income tax reserves are adequately maintained taking into consideration both the technical merits of its tax return positions and ongoing developments in its income tax audits. However, the final determination of the Company's tax return positions, if audited, is uncertain and therefore there is a possibility that final resolution of these matters could have a material impact on the Company's results of operations or cash flows.

Note 18 - Share-based Compensation

The Company's equity incentive plans include grants of share options, restricted share units, performance shares, performance rights, and share rights.

In fiscal years 2023, 2022, and 2021, share options and performance rights or performance shares (awarded to U.S. participants in place of performance rights) were granted to officers and employees. The exercise price for share options was set at the time of grant. The requisite service period for outstanding share options, performance rights, or performance shares ranges from two to three years. The awards are also subject to performance and market conditions. At vesting, share options can be exercised and converted to ordinary shares on a one-for-one basis, subject to payment of the exercise price. The contractual term of the share options ranges from five to six years from the grant date. At vesting, performance rights can be exercised and converted to ordinary shares on a one-for-one basis. Performance shares vest automatically and convert to ordinary shares on a one-for-one basis.

Restricted share units may be granted to directors, officers, and employees of the Company and vest on terms as described in the award. The restrictions prevent the participant from disposing of the restricted share units during the vesting period. The fair value of restricted share units is determined based on the closing price of the Company's shares on the grant date.

Share rights may be granted to directors, officers, and employees of the Company and vest on terms as described in the award. The restrictions prevent the participant from disposing of the share rights during the vesting period. The fair value of share rights is determined based on the closing price of the Company's shares on the grant date, adjusted for dividend yield.

As of June 30, 2023, 41 million shares were reserved for future grants. The Company uses treasury shares to settle share-based compensation obligations. Treasury shares are acquired through market purchases throughout the fiscal year for the required number of shares.

Share-based compensation expense was primarily recorded in selling, general, and administrative expenses in the consolidated statements of income. The total share-based compensation expense in fiscal years 2023, 2022, and 2021 amounted to $54 million, $63 million, and $58 million,

As of June 30, 2023, there was $71 million of total unrecognized compensation cost related to all unvested share options and other equity incentive plans. That cost is expected to be recognized over a weighted-average period of 1.8 years.

The weighted-average grant date fair values by type of equity incentive plan for awards granted in fiscal years 2023, 2022, and 2021 were as follows:

						For the years ended June 30,
(in $ per unit of award)						2023						2022						2021
Share options (1)						1.66						1.29						1.08
Restricted share units						11.91						11.62						11.06
Performance rights/shares (2)						8.18						9.40						7.22
Share rights						10.90						11.44						10.22

(1)The fair value of share options was determined using Black-Scholes option pricing model with the following key assumptions for the fiscal years ended June 30, 2023, 2022, and 2021, respectively: risk-free interest rate of 3.4% (2022: 1.0%, 2021: 0.2%), expected share-price volatility of 23.0% (2022: 22.0%, 2021: 25.0%), expected dividend yield of 4.0% (2022: 4.1%, 2021: 4.7%), and expected life of options of 6.1 years (2022: 6.1 years, 2021: 6.1 years).

(2)The fair value of performance rights/shares was determined using a combination of Black-Scholes option pricing model and Monte Carlo simulation. The key assumptions for the fiscal years ended June 30, 2023, 2022, and 2021, respectively, were: risk-free interest rate of 3.5% (2022: 0.4%, 2021: 0.2%), expected share-price volatility of 23.0% (2022: 22.0%, 2021: 25.0%), and expected dividend yield of 4.0% (2022: 4.1%, 2021: 4.7%).

Changes in outstanding share options were as follows:

						Share options
						Number						Weighted-average Exercise Price
						(in millions)
Share options outstanding at June 30, 2022						45						$	10.66
Granted						7						11.79
Exercised						(13)						9.88
Forfeited						(6)						10.24
Share options outstanding at June 30, 2023						33						11.29
Vested and exercisable at June 30, 2023						9						$	10.06

As of June 30, 2023, the share options outstanding have an intrinsic value of $1 million and a remaining weighted average contractual life of 3.7 years. As of June 30, 2023, the share options that have vested and are exercisable have an intrinsic value of $1 million and a remaining weighted average contractual life of 2.1 years.

The Company received $134 million, $114 million, and $30 million on the exercise of stock options during the fiscal years ended June 30, 2023, 2022, and 2021, respectively. During the fiscal years ended June 30, 2023, 2022, and 2021, the intrinsic value associated with the exercise of share options was $31 million, $15 million, and $6 million, respectively. The grant date fair value of share options vested was $15 million, $13 million, and $2 million for fiscal years ended June 30, 2023, 2022, and 2021, respectively.

Changes in outstanding other equity incentive plans and the fair values vested are presented below:

						Restricted share units												Performance rights/shares												Share rights
						Number						Weighted-average Grant Date Fair Value						Number						Weighted-average Grant Date Fair Value						Number						Weighted-average Grant Date Fair Value
						(in millions)									(in millions)									(in millions)
Outstanding at June 30, 2022						1						$	11.41					11						$	7.79					4						$	10.90
Granted						1						11.91						4						8.18						2						10.90
Exercised						(1)						11.16						(3)						6.65						(2)						10.26
Forfeited						—						—						(1)						7.46						—						—
Outstanding at June 30, 2023						1						$	11.67					11						$	8.20					4						$	11.22
Fair value vested ($ in millions)						Restricted share units												Performance rights/shares												Share rights
Year Ended June 30, 2023						$	2											$	16											$	20
Year Ended June 30, 2022						3												8												7
Year Ended June 30, 2021						3												3												5

Note 19 - Earnings Per Share Computations

The Company applies the two-class method when computing its earnings per share ("EPS"), which requires that net income per share for each class of share be calculated assuming all of the Company's net income is distributed as dividends to each class of share based on their contractual rights.

Basic EPS is computed by dividing net income available to ordinary shareholders by the weighted-average number of ordinary shares outstanding after excluding the ordinary shares to be repurchased using forward contracts. Diluted EPS includes the effects of share options, restricted share units, performance rights, performance shares, and share rights, if dilutive.

						Years ended June 30,
($ in millions, except per share amounts)						2023						2022						2021
Numerator
Net income attributable to Amcor plc						$	1,048					$	805					$	939
Distributed and undistributed earnings attributable to shares to be repurchased						(7)						(3)						(2)
Net income available to ordinary shareholders of Amcor plc—basic and diluted						$	1,041					$	802					$	937
Denominator
Weighted-average ordinary shares outstanding						1,478						1,514						1,553
Weighted-average ordinary shares to be repurchased by Amcor plc						(10)						(5)						(2)
Weighted-average ordinary shares outstanding for EPS—basic						1,468						1,509						1,551
Effect of dilutive shares						8						6						5
Weighted-average ordinary shares outstanding for EPS—diluted						1,476						1,516						1,556
Per ordinary share income
Basic earnings per ordinary share						$	0.709					$	0.532					$	0.604
Diluted earnings per ordinary share						$	0.705					$	0.529					$	0.602

Certain stock awards outstanding were not included in the computation of diluted earnings per share above because they would not have had a dilutive effect. The excluded stock awards represented an aggregate of 16 million, 7 million, and 6 million shares at June 30, 2023, 2022, and 2021, respectively. Basic and diluted weighted average ordinary shares outstanding have decreased in fiscal years 2023, 2022, and 2021 due to share repurchases.

Note 20 - Contingencies and Legal Proceedings

Contingencies - Brazil

The Company's operations in Brazil are involved in various governmental assessments and litigation, principally related to claims for excise and income taxes. The Company vigorously defends its positions and believes it will prevail on most, if not all, of these matters. The Company does not believe that the ultimate resolution of these matters will materially impact the Company's consolidated results of operations, financial position, or cash flows. Under customary local regulations, the Company's Brazilian subsidiaries may need to post cash or other collateral if a challenge to any administrative assessment proceeds to the Brazilian court system; however, the level of cash or collateral already pledged or potentially required to be pledged would not significantly impact the Company's liquidity. At June 30, 2023, the Company has recorded accruals of $14 million, included in other non-current liabilities in the consolidated balance sheets. The Company has estimated a reasonably possible loss exposure in excess of the accrual of $26 million as of June 30, 2023. The litigation process is subject to many uncertainties and the outcome of individual matters cannot be accurately predicted. The Company routinely assesses these matters as to the probability of ultimately incurring a liability and records the best estimate of the ultimate loss in situations where the likelihood of an ultimate loss is probable. The Company's assessments are based on its knowledge and experience, but the ultimate outcome of any of these matters may differ from the Company's estimates.

As of June 30, 2023, the Company provided letters of credit of $16 million, judicial insurance of $2 million, and deposited cash of $14 million with the courts to continue to defend the cases referenced above.

Contingencies - Environmental Matters

The Company, along with others, has been identified as a potentially responsible party ("PRP") at several waste disposal sites under U.S. federal and related state environmental statutes and regulations and may face potentially material environmental remediation obligations. While the Company benefits from various forms of insurance policies, actual coverage may not, or only partially, cover the total potential exposures. As of June 30, 2023, the Company has recorded aggregate accruals of $9 million for its share of estimated future remediation costs at these sites.

In addition to the matters described above, as of June 30, 2023, the Company has also recorded aggregate accruals of $54 million for potential liabilities for remediation obligations at various worldwide locations that are owned or operated by the Company or were formerly owned or operated.

The SEC requires the Company to disclose certain information about proceedings arising under federal, state, or local environmental provisions if the Company reasonably believes that such proceeding may result in monetary sanctions above a stated threshold. Pursuant to SEC regulations, the Company uses a threshold of $1 million or more for purposes of determining whether disclosure of any such proceedings is required. Applying this threshold, there are no environmental matters required to be disclosed for the fiscal year ended June 30, 2023.

While the Company believes that its accruals are adequate to cover its future obligations, there can be no assurance that the ultimate payments will not exceed the accrued amounts. Nevertheless, based on the available information, the Company does not believe that its potential environmental obligations will have a material adverse effect upon its liquidity, results of operations, or financial condition.

Other Matters

In the normal course of business, the Company is subject to legal proceedings, lawsuits, and other claims. While the potential financial impact with respect to these ordinary course matters is subject to many factors and uncertainties, management believes that any financial impact to the Company from these matters, individually and in the aggregate, would not have a material adverse effect on the Company's financial position or results of operation.

Note 21 - Segments

The Company's business is organized and presented in the two reportable segments outlined below:

Flexibles: Consists of operations that manufacture flexible and film packaging in the food and beverage, medical and pharmaceutical, fresh produce, snack food, personal care, and other industries. The Russian business results through the date of disposal are included in the Flexibles reportable segment.

Rigid Packaging: Consists of operations that manufacture rigid containers for a broad range of predominantly beverage and food products, including carbonated soft drinks, water, juices, sports drinks, milk-based beverages, spirits and beer, sauces, dressings, spreads and personal care items, and plastic caps for a wide variety of applications.

Other consists of the Company's undistributed corporate expenses including executive and functional compensation costs, equity method and other investments, intercompany eliminations, and other business activities.

Operating segments are organized along the Company's product lines and geographical areas. The Company's five Flexibles operating segments (Flexibles Europe, Middle East and Africa; Flexibles North America; Flexibles Latin America; Flexibles Asia Pacific; and Specialty Cartons) have been aggregated in the Flexibles reportable segment as they exhibit similarity in economic characteristics and future prospects, similarity in the products they offer, their production technologies, the customers they serve, the nature of their service delivery models, and their regulatory environments.

The Company evaluates performance and allocates resources based on adjusted earnings before interest and taxes ("Adjusted EBIT"). The Company defines Adjusted EBIT as operating income adjusted to eliminate the impact of certain items that the Company does not consider indicative of its ongoing operating performance and to include equity in income of affiliated companies, net of tax.

The accounting policies of the reportable segments are the same as those in the consolidated financial statements.

The following table presents information about reportable segments. Intersegment sales are not material and therefore are not presented in the table below.

						Years ended June 30,
($ in millions)						2023						2022						2021
Flexibles						$	11,154					$	11,151					$	10,038
Rigid Packaging						3,540						3,393						2,823
Other						—						—						—
Net sales						$	14,694					$	14,544					$	12,861
Adjusted earnings before interest and taxes ("Adjusted EBIT")
Flexibles						1,429						1,517						1,427
Rigid Packaging						265						289						299
Other						(86)						(105)						(105)
Adjusted EBIT						1,608						1,701						1,621
Less: 2018/2019 Restructuring programs (1)						—						(37)						(88)
Less: Amortization of acquired intangible assets from business combinations (2)						(160)						(163)						(165)
Less: Impact of hyperinflation (3)						(24)						(16)						(19)
Less: Pension settlements (4)						(5)						(8)						—
Add/(Less): Net gain/(loss) on disposals (5)						—						(10)						9
Less: Property and other losses, net (6)						(2)						(13)						—
Add/(Less): Russia-Ukraine conflict impacts (7)						90						(200)						—
Add/(Less): Other (8)						3						(4)						(7)
Interest income						31						24						14
Interest expense						(290)						(159)						(153)
Equity in income of affiliated companies, net of tax						—						—						(19)
Income before income taxes and equity in income of affiliated companies						$	1,251					$	1,115					$	1,193

(1)2018/2019 Restructuring programs includes restructuring and related expenses for the 2019 Bemis Integration Plan for fiscal year 2022, and 2018 Rigid Packaging Restructuring Plan and the 2019 Bemis Integration Plan for fiscal year 2021. Refer to Note 7, "Restructuring," for more information.

(2)Amortization of acquired intangible assets from business combinations includes amortization expenses related to all acquired intangible assets from past acquisitions.

(3)Impact of hyperinflation includes the adverse impact of highly inflationary accounting for subsidiaries in Argentina where the functional currency was the Argentine Peso.

(4)Pension settlements in fiscal year 2023 primarily includes the settlement of a small European plan and in fiscal year 2022 the purchase of group annuity contracts and transfer of pension plan assets and related benefit obligations. Refer to Note 13, "Pension Plans," for more information.

(5)Net gain/(loss) on disposals, excluding the disposal of the Company's Russian business, includes an expense of $10 million from the disposal of non-core assets in fiscal year 2022. Refer to Note 11, "Fair Value Measurements," for more information. Fiscal year 2021 includes the gain realized upon the disposal of AMVIG and the loss upon disposal of other non-core businesses not part of material restructuring programs. Refer to Note 8, "Equity Method and Other Investments," for further information on the disposal of AMVIG and Note 5, "Acquisitions and Divestitures," for more information regarding the other disposals.

(6)Property and other losses, net in fiscal year 2023 includes property claims and losses of $5 million and $3 million of net insurance recovery related to the closure of the Company's South African business. Fiscal year 2022 includes business losses primarily associated with the destruction of the Company's Durban, South Africa facility during general civil unrest in July 2021, net of insurance recovery.

(7)Russia-Ukraine conflict impacts in fiscal year 2023 includes a pre-tax net gain on the sale of the Company's Russian business of $215 million, incremental costs of $18 million, and restructuring and related expenses of $107 million incurred in connection with the conflict. Fiscal year 2022 includes $138 million of impairment charges, $57 million of restructuring and related expenses, and $5 million of other expenses. Refer to Note 4, "Restructuring, Impairment, and Other Related Activities, Net, " and Note 7, "Restructuring," for further information.

(8)Other in fiscal year 2023 includes restructuring, acquisition, litigation, and integration expenses of $13 million and fair value gains of $16 million on economic hedges. Fiscal years 2022 and 2021 include costs associated with the Bemis transaction and fiscal year 2021 also includes a $19 million benefit related to Brazil indirect taxes resulting from a May 2021 Brazil Supreme Court decision.

The tables below present additional financial information by reportable segments:

Capital expenditures for the acquisition of long-lived assets by reportable segment were:

						Years ended June 30,
($ in millions)						2023						2022						2021
Flexibles						$	384					$	376					$	336
Rigid Packaging						133						136						127
Other						9						15						5
Total capital expenditures for the acquisition of long-lived assets						$	526					$	527					$	468

Depreciation and amortization by reportable segment were:

						Years ended June 30,
($ in millions)						2023						2022						2021
Flexibles						$	436					$	450					$	447
Rigid Packaging						125						120						115
Other						8						9						10
Total depreciation and amortization						$	569					$	579					$	572

Total assets by segment is not disclosed as the Company's Chief Operating Decision Maker does not use total assets by segment to evaluate segment performance or allocate resources and capital.

The Company did not have sales to a single customer that exceeded 10% of consolidated net sales for the fiscal years ended June 30, 2023, 2022, and 2021, respectively.

Sales by major product were:

												Years ended June 30,
($ in millions)						Segment						2023						2022						2021
Films and other flexible products						Flexibles						$	10,061					$	10,033					$	8,934
Specialty flexible folding cartons						Flexibles						1,093						1,118						1,104
Containers, preforms, and closures						Rigid Packaging						3,540						3,393						2,823
Net sales												$	14,694					$	14,544					$	12,861

The following table provides long-lived asset information for the major countries in which the Company operates. Long-lived assets include property, plant, and equipment, net of accumulated depreciation and impairments.

						June 30,
($ in millions)						2023						2022
United States of America						$	1,710					$	1,720
Other countries (1)						2,052						1,926
Long-lived assets						$	3,762					$	3,646

(1)Includes the Company's country of domicile, Jersey. The Company had no long-lived assets in Jersey in any period shown. No individual country represented more than 10% of the respective totals.

The following tables disaggregate net sales information by geography in which the Company operates based on manufacturing or selling operations:

						Year Ended June 30, 2023
($ in millions)						Flexibles						Rigid Packaging						Total
North America						$	4,411					$	2,745					$	7,156
Latin America						1,114						795						1,909
Europe (1)						3,952						—						3,952
Asia Pacific						1,677						—						1,677
Net sales						$	11,154					$	3,540					$	14,694

						Year Ended June 30, 2022
($ in millions)						Flexibles						Rigid Packaging						Total
North America						$	4,296					$	2,656					$	6,952
Latin America						1,060						737						1,797
Europe (1)						4,062						—						4,062
Asia Pacific						1,733						—						1,733
Net sales						$	11,151					$	3,393					$	14,544

						Year Ended June 30, 2021
($ in millions)						Flexibles						Rigid Packaging						Total
North America						$	3,719					$	2,319					$	6,038
Latin America						914						504						1,418
Europe (1)						3,828						—						3,828
Asia Pacific						1,577						—						1,577
Net sales						$	10,038					$	2,823					$	12,861

(1)Includes the Company's country of domicile, Jersey. The Company had no sales in Jersey in the periods shown.

Note 22 - Deed of Cross Guarantee

The parent entity, Amcor plc, and its wholly owned subsidiaries listed below are subject to a Deed of Cross Guarantee dated June 24, 2019 (the "Deed") under which each company guarantees the debts of the others:

Amcor Pty Ltd			Amcor Holdings (Australia) Pty Ltd
Amcor Services Pty Ltd			Amcor Flexibles Group Pty Ltd
Amcor Investments Pty Ltd			Amcor Flexibles (Australia) Pty Ltd
Amcor Finance Australia Pty Ltd			Amcor Flexibles (Port Melbourne) Pty Ltd
Amcor European Holdings Pty Ltd			Amcor Packaging (Asia) Pty Ltd
ARP North America Holdco Ltd			ARP LATAM Holdco Ltd

The entities above were the only parties to the Deed as of June 30, 2023, and comprise the closed group for the purposes of the Deed (and also the extended closed group). ARP North America Holdco Ltd and ARP LATAM Holdco Ltd were newly incorporated entities and were added to the deed on September 25, 2019. By a Revocation Deed, dated September 9, 2021, the Deed was revoked in respect of Amcor Flexibles (Dandenong) Pty Ltd, Packsys Pty Ltd, Packsys Holdings (Aus) Pty Ltd, and Techni-Chem Australia Pty Ltd. No other parties have been added, removed or the subject to a notice of disposal since September 9, 2021.

By entering into the Deed, the wholly owned subsidiaries have been relieved from the requirement to prepare a financial report and directors’ report under ASIC Corporations (Wholly-owned Companies) Instrument 2016/785.

The following consolidated financial statements are additional disclosure items specifically required by ASIC and represent the consolidated results of the entities subject to the Deed.

Deed of Cross Guarantee

Consolidated Statements of Income

($ in millions)

For the years ended June 30,						2023						2022
Net sales						$	377					$	391
Cost of sales						(319)						(337)
Gross profit						58						54
Operating expenses						(1,125)						(1,251)
Other income, net						1,599						2,355
Operating income						532						1,158
Interest income						15						12
Interest expense						(38)						(14)
Other non-operating income, net						—						1
Income before income taxes						509						1,157
Income tax expense						(22)						(4)
Net income						$	487					$	1,153

Deed of Cross Guarantee

Consolidated Statements of Comprehensive Income

($ in millions)

For the years ended June 30,						2023						2022
Net income						$	487					$	1,153
Other comprehensive income/(loss) (1):
Foreign currency translation adjustments, net of tax						(10)						(30)
Other comprehensive income/(loss)						(10)						(30)
Comprehensive income/(loss) attributable to non-controlling interests						—						—
Total comprehensive income						$	477					$	1,123

(1)All of the items in other comprehensive income/(loss) may be reclassified subsequently to profit or loss.

Deed of Cross Guarantee

Consolidated Statements of Income and Accumulated Losses

($ in millions)

For the years ended June 30,						2023						2022
Retained earnings, beginning balance						$	7,167					$	6,737
Net income						487						1,153
Retained earnings before distribution						7,654						7,890
Dividends recognized during the financial period						(717)						(723)
Retained earnings at the end of the financial period						$	6,937					$	7,167

Deed of Cross Guarantee

Consolidated Balance Sheets

($ in millions)

As of June 30,						2023						2022
Assets
Current assets:
Cash and cash equivalents						$	54					$	68
Receivables, net						342						662
Inventories						60						71
Prepaid expenses and other current assets						21						19
Total current assets						477						820
Non-current assets:
Property, plant, and equipment, net						60						63
Deferred tax assets						6						26
Other intangible assets, net						13						12
Goodwill						88						91
Other non-current assets						13,308						14,039
Total non-current assets						13,475						14,231
Total assets						$	13,952					$	15,051
Liabilities
Current liabilities:
Short-term debt						$	826					$	901
Payables						153						162
Accrued employee costs						23						21
Other current liabilities						143						191
Total current liabilities						1,145						1,275
Non-current liabilities:
Long-term debt, less current portion						—						319
Other non-current liabilities						2						2
Total liabilities						1,147						1,596
Shareholders' Equity
Issued capital						14						15
Additional paid-in capital						4,829						5,239
Retained earnings						6,937						7,167
Accumulated other comprehensive income						1,025						1,034
Total shareholders' equity						12,805						13,455
Total liabilities and shareholders' equity						$	13,952					$	15,051

Note 23 - Supplemental Cash Flow Information

Supplemental cash flow information and non-cash investing activities are as follows:

						For the years ended June 30,
($ in millions)						2023						2022						2021
Supplemental Cash Flow Information:
Interest paid, net of amounts capitalized						$	276					$	155					$	146
Income taxes paid						225						256						321
Non-Cash Investing Activities:
Purchase of property, plant, and equipment accrued, but not paid						$	71					$	110					$	76
Contingent and deferred liabilities incurred related to acquired businesses, but not paid						41						—						—

Note 24 - Subsequent Events

In July 2023, the Company executed a buy-in policy contract with a third-party insurance company for a portion of one of its closed principal defined benefit plans in the United Kingdom. As of June 30, 2023, the plan assets and corresponding benefit obligations that were part of the buy-in transaction were approximately $60 million.

On August 10, 2023, the Company signed an agreement to acquire a small manufacturer of flexible packaging for food, home care and personal care applications in India. This acquisition will complement the Company’s existing flexible packaging footprint in India and enable local production of a broader range of sustainable packaging solutions.

On August 16, 2023, the Company's Board of Directors declared a quarterly cash dividend of $0.1225 per share to be paid on September 27, 2023, to shareholders of record as of September 7, 2023. Amcor has received a waiver from the Australian Securities Exchange ("ASX") settlement operating rules, which will allow Amcor to defer processing conversions between its ordinary share and CHESS Depositary Instrument ("CDI") registers from September 6, 2023, to September 7, 2023, inclusive.