SEC Company Response from Amcor plc (AMCR, AMCCF) (CIK 0001748790) (AMCR) — Apr 28, 2020
Amcor plc (AMCR, AMCCF) (CIK 0001748790)
Date: April 28, 2020 · CIK: 0001748790 · Accession: 0001104659-20-052299
AI Filing Summary & Sentiment
File numbers found in text: 001-38932
Letter
VIA EDGAR Office of Manufacturing Division of Corporation Finance United States Securities and Exchange Commission 100 F Street, NE Washington, D.C. 20549 Form 10-K for the Fiscal Year Ended June 30, 2019 Form 10-Q for the Fiscal Quarter Ended December 31, 2019 Form 8-K furnished February 11, 2020 File No. 001-38932
Dear Ms. Clark and Ms. Erlanger:
On behalf of Amcor plc, a company organized under the laws of Jersey, Channel Islands (the “Company”), below please find our responses to the comment letter to Mr. Casamento, the Chief Financial Officer of the Company, dated March 31, 2020, from the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”). The numbered paragraphs below set forth the Staff’s comments together with the Company’s responses. Page numbers and table numbers in the Company’s responses correspond to page numbers and table numbers, respectively, in the Company’s applicable filing with the Commission.
Please note that certain confidential information contained in this letter was omitted by means of redacting a portion of the text. The symbol “[****]” has been inserted in place of the omitted portions (the “redacted information”). Copies of this letter containing the redacted information have been filed separately with the Commission subject to a request for confidential treatment pursuant to Rule 83 of the Commission’s Rules on Information and Requests (17 CFR §200.83). The Company requests that the redacted information be maintained in confidence, not be made part of any public record and not be disclosed to any person (other than the Staff) as they contain confidential information.
Form 10-K for the Fiscal Year Ended June 30, 2019
Financial Statements
Consolidated Statement of Cash Flows, page 43
1. Staff’s Comment: We note from your disclosure in Note 4 that the Bemis acquisition in 2019 was a significant stock only acquisition. Please revise the statement of cash flows to disclose all noncash investing and financing activities as required by ASC 230-10-50-3.
Response: The Company respectfully acknowledges the Staff’s comment. The Company did disclose in Note 4 that the acquisition of Bemis was stock only and highlighted the exchange ratio and fair value of consideration exchanged. The Company has reviewed the disclosure requirements of ASC 230-10-50-3 and will revise future filings to present information about all material investing and financing activities that affect recognized assets or liabilities but that do not result in cash receipts or cash payments. This will include disclosure to present in our consolidated statement of cash flows the issuance of ordinary shares for material acquisitions, material accruals for the purchase of property, plant and equipment, and any other material noncash investing and financing activities. The Company intends to make
Amcor plc
Thurgauerstrasse 34, CH-8050, Zürich , Switzerland, www.amcor.com
***CONFIDENTIAL TREATMENT REQUESTED BY AMCOR PLC FOR CERTAIN PORTIONS OF THIS LETTER PURSUANT TO RULE 83***
these disclosures beginning with the Company’s Quarterly Report on Form 10-Q for the quarter ending March 31, 2020.
2. Staff’s Comment: We note that you have included an adjustment to reconcile net income to net cash provided by operating activities of $77.9 million titled “other, net.” Please identify for us the nature of this adjustment.
Response: The “other, net” line in the fiscal year 2019 Consolidated Statement of Cash Flows includes several items. The composition of “other, net” is consistent among all periods presented.
In fiscal year 2019, there were three items that largely contributed to the balance:
· A reduction of tax reserves of $49.0 million resulting from final tax determinations following the filing of tax returns, closing of statutes related to prior tax filings and the reduction of a tax liability established for prior year tax law changes in one of the Company’s foreign jurisdictions.
· In connection with the Bemis acquisition and a related debt consent and exchange effected in June 2019, the Company incurred higher cash outflows related to the accelerated settlement of accrued interest balances, resulting in cash interest payments which exceeded net interest expense by approximately $16.5 million.
· The Company recognized net deferred credits of $16.2 million related to the Company’s captive insurance company.
The remainder of the balance is comprised of individually immaterial items.
Notes to Consolidated Financial Statements
Note 10 - Fair Value Measurements, page 60
3. Staff’s Comment: We note from your disclosures that during 2019 and 2018 you had several impairments such as the $31.1 million impairment for a technology intangible in 2019 and a $36.5 million impairment to an equity method investment in 2019. Please revise to include disclosures related to assets and liabilities measured at fair value on a nonrecurring basis as required by ASC 820-10-50-2.
Response: The Company respectfully acknowledges the Staff’s comment and has reviewed the disclosure requirements of ASC 820-10-50-2. Upon our review, we believe that our disclosure meets many of the substantive disclosure requirements related to assets measured at fair value on a non-recurring basis, albeit outside of Note 10 – Fair Value Measurements. For instance, in Note 7 – Equity Method Investments, we state the methodology and publicly traded stock price input used to evaluate impairment (a Level 1 valuation within the fair value hierarchy), along with the results of the most recent impairment test performed. Likewise, in Note 9 – Goodwill and Other Intangible Assets, we state the results of our annual impairment test for intangible assets, and expound upon the asset class, including the valuation techniques used and discounted cash flow input (a Level 3 valuation within the fair value hierarchy), in our Critical Accounting Estimates and Judgements.
***CONFIDENTIAL TREATMENT REQUESTED BY AMCOR PLC FOR CERTAIN PORTIONS OF THIS LETTER PURSUANT TO RULE 83***
However, the Company acknowledges that aggregating the information in one location within the financial statement notes would be beneficial to a reader of our financial statements, along with a more direct statement of the level within the fair value hierarchy for each asset class and a corresponding discussion of the inputs used to value Level 3 assets.
In light of the Staff’s comment, find below an example of additional disclosure which will be included in our Fair Value Measurements note. The specific disclosure shown below is a revision to our Quarterly Report on Form 10-Q for the quarter ended December 31, 2019 and is shown for illustrative purposes only, as an example of the type of language that Amcor intends to include in its periodic filings beginning with the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020.
Fair Value Measurements – Nonrecurring Basis
In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company records assets and liabilities at fair value on a nonrecurring basis as required by U.S. GAAP. The Company measures certain assets, including the Company’s equity method investments and intangible assets, at fair value on a nonrecurring basis when they are deemed to be other than temporarily impaired. 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.
The Company tests for impairment of its equity method investments when impairment indicators are present. Impairment tests were performed by comparing the carrying value of the Company’s investment in AMVIG Holdings Limited (“AMVIG”) at the end of each period, including interim periods, to the fair value of the investment, which was determined based on AMVIG’s quoted share price. The Company recorded impairment charges in fiscal years 2019 and 2018 of $14.0 million and $36.5 million, respectively, as the fair value of the investment was below its carrying value. The Company did not record an impairment charge in fiscal 2017 as the fair value of the investment was above its carrying value. The Company classified these fair value measurements as Level 1.
Similar to the manner in which it tests other intangible assets, the Company tests technology intangibles for impairment when facts and circumstances indicate the carrying value may not be recoverable from their undiscounted cash flows. During fiscal 2019, and in conjunction with a business review and the Company’s annual review of intangibles, the Company performed a quantitative impairment test for a technology intangible asset utilizing a discounted cash flow valuation method using current market interest rates for instruments with similar terms and recognized non-cash impairment charges of $31.1 million to reduce the carrying value of the asset to its fair value. There were no technology intangible impairment charges recorded during the twelve months ended June 30, 2018. The Company classified these fair value measurements as Level 3.
Form 10-Q for the Fiscal Quarter Ended December 31, 2019
***CONFIDENTIAL TREATMENT REQUESTED BY AMCOR PLC FOR CERTAIN PORTIONS OF THIS LETTER PURSUANT TO RULE 83***
Financial Statements
Notes to Condensed Consolidated Financial Statements
Note 14 – Segments, page 29
4. Staff’s Comment: We note from your disclosure on page 29 that you aggregate your five Flexibles operating segments into one reportable segment. It appears from your disclosure on page 31 that sales from North America were over 50% of total sales for the six month ended December 31, 2019. Explain to us how you evaluated the aggregation criteria in ASC 280-10-50-11 in determining you have only one Flexibles reportable segment. In doing so, explain in sufficient detail how you determined your operating segments have similar economic characteristics.
Response: The Company respectfully acknowledges the Staff’s comment. Both reportable segments of the Company have sales from North America. As the table below highlights, $2.9 billion or 46% of total company sales were from North America for the six months ended December 31, 2019. North American sales from the Flexibles reportable segment of $1.8 billion represented 37% of total Flexibles sales and 29% of total company sales while North American sales of $1.1 billion from the Rigid Packaging reportable segment represented approximately 80% of this segment’s total sales and 17% of total company sales.
(in millions)
Six Months Ended December 31, 2019
Flexibles
Rigid
Packaging
Total
North America
$
1,786.1
$
1,068.7
$
2,854.8
Total Net Sales
$
4,844.0
$
1,339.8
$
6,183.8
% of Segment Total Sales
37%
80%
46%
% of Total Company Sales
29%
17%
As disclosed in the referenced filing, in conjunction with the acquisition of Bemis, the Company reassessed its segment reporting structure in the first fiscal quarter of 2020 and elected to disaggregate the Flexibles Americas operating segment into Flexibles North America and Flexibles Latin America. The 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 reporting segment.
The aggregation of the flexible operating segments is consistent with the criteria set forth in ASC 280-10-50-11, which provides that two or more operating segments may be aggregated a) if aggregation is consistent with the objectives and principles of ASC 280, b) if the operating segments have similar economic characteristics and c) if the operating segments are similar in the following five qualitative characteristics: nature of services, nature of developing their product, types of customers, methods of distributing products and similar regulatory environment.
***CONFIDENTIAL TREATMENT REQUESTED BY AMCOR PLC FOR CERTAIN PORTIONS OF THIS LETTER PURSUANT TO RULE 83***
The Company’s analysis of the considerations specified in ASC 280-10-50-11 is presented below. The Company believes it has appropriately aggregated its five flexible operating segments based on reasonable judgment and the intent of ASC 280.
Similar Qualitative Characteristics
The following factors were considered in concluding the five Flexibles operating segments share similar qualitative characteristics.
a. The nature of products and services – same types of products that are a variety of plastic, paper and aluminum flexible packaging for consumer products
The five Flexibles operating segments manufacture flexible packaging for customers in a variety of industries. The products of the different flexible operating segments may vary by customer, but they are similar in nature in that they are used for the protection and ease of use in various end products such as food, personal care products, medical and pharmaceutical products and other applications. The same types of primary raw materials are used across all operating segments including polymer resins, films, paper, ink, adhesives and aluminium.
b. The nature of the production process – same types of production equipment from same equipment suppliers that convert same materials
The production processes for the five Flexibles operating segments are consistent and include designing, printing, extruding, laminating, converting, slitting and rewinding into flexible packaging products using variations of the same raw materials. The production equipment used in these processes are also consistent and comprise large gravure and offset printing machines, extruders, slitters, cutters and laminators in addition to a variety of converting equipment including pouch and bag making equipment. The sourcing of direct and indirect materials as well as the equipment for these Flexibles operating segments is often a jointly coordinated effort. It is common for equipment and materials to be sourced for the different operating segments from the same supplier with similar specifications. On many occasions and for many years the Company has transferred production equipment from one Flexibles operating segment to another to address capacity issues given the similarity of the equipment.
c. The type or class of customer for their products and services – same types of customers, essentially global and regional fast-moving consumer goods companies
The customers of all five Flexibles operating segments are manufacturers of fast-moving consumer goods. Each Flexibles operating segment sells to large global key accounts as well as to smaller regional and local customers. Sales efforts to global key accounts are typically centrally coordinated between the five flexible operating segments to ensure cost efficiency, alignment of product specifications, and consistent customer experience across the globe.
***CONFIDENTIAL TREATMENT REQUESTED BY AMCOR PLC FOR CERTAIN PORTIONS OF THIS LETTER PURSUANT TO RULE 83***
d. The methods used to distribute their products or provide their services – essentially all sales are direct to customers (direct sales and direct distribution)
All products supplied by the five Flexibles operating segments are primarily distributed by the Company’s direct sales force. The flexible packaging products are distributed to customers in the same common formats (for example, rolls or sheets on pallets) where they are subsequently further processed and filled as part of the customer’s manufacturing process. The same tran
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CORRESP 1 filename1.htm CONFIDENTIAL TREATMENT REQUESTED BY AMCOR PLC FOR CERTAIN PORTIONS OF THIS LETTER PURSUANT TO 17 C.F.R. § 200.83 (“RULE 83”) April 28, 2020 VIA EDGAR Ms. Heather Clark Ms. Claire Erlanger Office of Manufacturing Division of Corporation Finance United States Securities and Exchange Commission 100 F Street, NE Washington, D.C. 20549 Re: Amcor plc Form 10-K for the Fiscal Year Ended June 30, 2019 Form 10-Q for the Fiscal Quarter Ended December 31, 2019 Form 8-K furnished February 11, 2020 File No. 001-38932 Dear Ms. Clark and Ms. Erlanger: On behalf of Amcor plc, a company organized under the laws of Jersey, Channel Islands (the “Company”), below please find our responses to the comment letter to Mr. Casamento, the Chief Financial Officer of the Company, dated March 31, 2020, from the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”). The numbered paragraphs below set forth the Staff’s comments together with the Company’s responses. Page numbers and table numbers in the Company’s responses correspond to page numbers and table numbers, respectively, in the Company’s applicable filing with the Commission. Please note that certain confidential information contained in this letter was omitted by means of redacting a portion of the text. The symbol “[****]” has been inserted in place of the omitted portions (the “redacted information”). Copies of this letter containing the redacted information have been filed separately with the Commission subject to a request for confidential treatment pursuant to Rule 83 of the Commission’s Rules on Information and Requests (17 CFR §200.83). The Company requests that the redacted information be maintained in confidence, not be made part of any public record and not be disclosed to any person (other than the Staff) as they contain confidential information. Form 10-K for the Fiscal Year Ended June 30, 2019 Financial Statements Consolidated Statement of Cash Flows, page 43 1. Staff’s Comment: We note from your disclosure in Note 4 that the Bemis acquisition in 2019 was a significant stock only acquisition. Please revise the statement of cash flows to disclose all noncash investing and financing activities as required by ASC 230-10-50-3. Response: The Company respectfully acknowledges the Staff’s comment. The Company did disclose in Note 4 that the acquisition of Bemis was stock only and highlighted the exchange ratio and fair value of consideration exchanged. The Company has reviewed the disclosure requirements of ASC 230-10-50-3 and will revise future filings to present information about all material investing and financing activities that affect recognized assets or liabilities but that do not result in cash receipts or cash payments. This will include disclosure to present in our consolidated statement of cash flows the issuance of ordinary shares for material acquisitions, material accruals for the purchase of property, plant and equipment, and any other material noncash investing and financing activities. The Company intends to make Amcor plc Thurgauerstrasse 34, CH-8050, Zürich , Switzerland, www.amcor.com ***CONFIDENTIAL TREATMENT REQUESTED BY AMCOR PLC FOR CERTAIN PORTIONS OF THIS LETTER PURSUANT TO RULE 83*** these disclosures beginning with the Company’s Quarterly Report on Form 10-Q for the quarter ending March 31, 2020. 2. Staff’s Comment: We note that you have included an adjustment to reconcile net income to net cash provided by operating activities of $77.9 million titled “other, net.” Please identify for us the nature of this adjustment. Response: The “other, net” line in the fiscal year 2019 Consolidated Statement of Cash Flows includes several items. The composition of “other, net” is consistent among all periods presented. In fiscal year 2019, there were three items that largely contributed to the balance: · A reduction of tax reserves of $49.0 million resulting from final tax determinations following the filing of tax returns, closing of statutes related to prior tax filings and the reduction of a tax liability established for prior year tax law changes in one of the Company’s foreign jurisdictions. · In connection with the Bemis acquisition and a related debt consent and exchange effected in June 2019, the Company incurred higher cash outflows related to the accelerated settlement of accrued interest balances, resulting in cash interest payments which exceeded net interest expense by approximately $16.5 million. · The Company recognized net deferred credits of $16.2 million related to the Company’s captive insurance company. The remainder of the balance is comprised of individually immaterial items. Notes to Consolidated Financial Statements Note 10 - Fair Value Measurements, page 60 3. Staff’s Comment: We note from your disclosures that during 2019 and 2018 you had several impairments such as the $31.1 million impairment for a technology intangible in 2019 and a $36.5 million impairment to an equity method investment in 2019. Please revise to include disclosures related to assets and liabilities measured at fair value on a nonrecurring basis as required by ASC 820-10-50-2. Response: The Company respectfully acknowledges the Staff’s comment and has reviewed the disclosure requirements of ASC 820-10-50-2. Upon our review, we believe that our disclosure meets many of the substantive disclosure requirements related to assets measured at fair value on a non-recurring basis, albeit outside of Note 10 – Fair Value Measurements. For instance, in Note 7 – Equity Method Investments, we state the methodology and publicly traded stock price input used to evaluate impairment (a Level 1 valuation within the fair value hierarchy), along with the results of the most recent impairment test performed. Likewise, in Note 9 – Goodwill and Other Intangible Assets, we state the results of our annual impairment test for intangible assets, and expound upon the asset class, including the valuation techniques used and discounted cash flow input (a Level 3 valuation within the fair value hierarchy), in our Critical Accounting Estimates and Judgements. 2 ***CONFIDENTIAL TREATMENT REQUESTED BY AMCOR PLC FOR CERTAIN PORTIONS OF THIS LETTER PURSUANT TO RULE 83*** However, the Company acknowledges that aggregating the information in one location within the financial statement notes would be beneficial to a reader of our financial statements, along with a more direct statement of the level within the fair value hierarchy for each asset class and a corresponding discussion of the inputs used to value Level 3 assets. In light of the Staff’s comment, find below an example of additional disclosure which will be included in our Fair Value Measurements note. The specific disclosure shown below is a revision to our Quarterly Report on Form 10-Q for the quarter ended December 31, 2019 and is shown for illustrative purposes only, as an example of the type of language that Amcor intends to include in its periodic filings beginning with the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020. Fair Value Measurements – Nonrecurring Basis In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company records assets and liabilities at fair value on a nonrecurring basis as required by U.S. GAAP. The Company measures certain assets, including the Company’s equity method investments and intangible assets, at fair value on a nonrecurring basis when they are deemed to be other than temporarily impaired. 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. The Company tests for impairment of its equity method investments when impairment indicators are present. Impairment tests were performed by comparing the carrying value of the Company’s investment in AMVIG Holdings Limited (“AMVIG”) at the end of each period, including interim periods, to the fair value of the investment, which was determined based on AMVIG’s quoted share price. The Company recorded impairment charges in fiscal years 2019 and 2018 of $14.0 million and $36.5 million, respectively, as the fair value of the investment was below its carrying value. The Company did not record an impairment charge in fiscal 2017 as the fair value of the investment was above its carrying value. The Company classified these fair value measurements as Level 1. Similar to the manner in which it tests other intangible assets, the Company tests technology intangibles for impairment when facts and circumstances indicate the carrying value may not be recoverable from their undiscounted cash flows. During fiscal 2019, and in conjunction with a business review and the Company’s annual review of intangibles, the Company performed a quantitative impairment test for a technology intangible asset utilizing a discounted cash flow valuation method using current market interest rates for instruments with similar terms and recognized non-cash impairment charges of $31.1 million to reduce the carrying value of the asset to its fair value. There were no technology intangible impairment charges recorded during the twelve months ended June 30, 2018. The Company classified these fair value measurements as Level 3. Form 10-Q for the Fiscal Quarter Ended December 31, 2019 3 ***CONFIDENTIAL TREATMENT REQUESTED BY AMCOR PLC FOR CERTAIN PORTIONS OF THIS LETTER PURSUANT TO RULE 83*** Financial Statements Notes to Condensed Consolidated Financial Statements Note 14 – Segments, page 29 4. Staff’s Comment: We note from your disclosure on page 29 that you aggregate your five Flexibles operating segments into one reportable segment. It appears from your disclosure on page 31 that sales from North America were over 50% of total sales for the six month ended December 31, 2019. Explain to us how you evaluated the aggregation criteria in ASC 280-10-50-11 in determining you have only one Flexibles reportable segment. In doing so, explain in sufficient detail how you determined your operating segments have similar economic characteristics. Response: The Company respectfully acknowledges the Staff’s comment. Both reportable segments of the Company have sales from North America. As the table below highlights, $2.9 billion or 46% of total company sales were from North America for the six months ended December 31, 2019. North American sales from the Flexibles reportable segment of $1.8 billion represented 37% of total Flexibles sales and 29% of total company sales while North American sales of $1.1 billion from the Rigid Packaging reportable segment represented approximately 80% of this segment’s total sales and 17% of total company sales. (in millions) Six Months Ended December 31, 2019 Flexibles Rigid Packaging Total North America $ 1,786.1 $ 1,068.7 $ 2,854.8 Total Net Sales $ 4,844.0 $ 1,339.8 $ 6,183.8 % of Segment Total Sales 37% 80% 46% % of Total Company Sales 29% 17% As disclosed in the referenced filing, in conjunction with the acquisition of Bemis, the Company reassessed its segment reporting structure in the first fiscal quarter of 2020 and elected to disaggregate the Flexibles Americas operating segment into Flexibles North America and Flexibles Latin America. The 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 reporting segment. The aggregation of the flexible operating segments is consistent with the criteria set forth in ASC 280-10-50-11, which provides that two or more operating segments may be aggregated a) if aggregation is consistent with the objectives and principles of ASC 280, b) if the operating segments have similar economic characteristics and c) if the operating segments are similar in the following five qualitative characteristics: nature of services, nature of developing their product, types of customers, methods of distributing products and similar regulatory environment. 4 ***CONFIDENTIAL TREATMENT REQUESTED BY AMCOR PLC FOR CERTAIN PORTIONS OF THIS LETTER PURSUANT TO RULE 83*** The Company’s analysis of the considerations specified in ASC 280-10-50-11 is presented below. The Company believes it has appropriately aggregated its five flexible operating segments based on reasonable judgment and the intent of ASC 280. Similar Qualitative Characteristics The following factors were considered in concluding the five Flexibles operating segments share similar qualitative characteristics. a. The nature of products and services – same types of products that are a variety of plastic, paper and aluminum flexible packaging for consumer products The five Flexibles operating segments manufacture flexible packaging for customers in a variety of industries. The products of the different flexible operating segments may vary by customer, but they are similar in nature in that they are used for the protection and ease of use in various end products such as food, personal care products, medical and pharmaceutical products and other applications. The same types of primary raw materials are used across all operating segments including polymer resins, films, paper, ink, adhesives and aluminium. b. The nature of the production process – same types of production equipment from same equipment suppliers that convert same materials The production processes for the five Flexibles operating segments are consistent and include designing, printing, extruding, laminating, converting, slitting and rewinding into flexible packaging products using variations of the same raw materials. The production equipment used in these processes are also consistent and comprise large gravure and offset printing machines, extruders, slitters, cutters and laminators in addition to a variety of converting equipment including pouch and bag making equipment. The sourcing of direct and indirect materials as well as the equipment for these Flexibles operating segments is often a jointly coordinated effort. It is common for equipment and materials to be sourced for the different operating segments from the same supplier with similar specifications. On many occasions and for many years the Company has transferred production equipment from one Flexibles operating segment to another to address capacity issues given the similarity of the equipment. c. The type or class of customer for their products and services – same types of customers, essentially global and regional fast-moving consumer goods companies The customers of all five Flexibles operating segments are manufacturers of fast-moving consumer goods. Each Flexibles operating segment sells to large global key accounts as well as to smaller regional and local customers. Sales efforts to global key accounts are typically centrally coordinated between the five flexible operating segments to ensure cost efficiency, alignment of product specifications, and consistent customer experience across the globe. 5 ***CONFIDENTIAL TREATMENT REQUESTED BY AMCOR PLC FOR CERTAIN PORTIONS OF THIS LETTER PURSUANT TO RULE 83*** d. The methods used to distribute their products or provide their services – essentially all sales are direct to customers (direct sales and direct distribution) All products supplied by the five Flexibles operating segments are primarily distributed by the Company’s direct sales force. The flexible packaging products are distributed to customers in the same common formats (for example, rolls or sheets on pallets) where they are subsequently further processed and filled as part of the customer’s manufacturing process. The same tran