Deon Stander
President and Chief Executive Officer at Avery Dennison
Thanks, John, and hello, everyone. I'm pleased to report another year of excellent progress towards our long-term strategic and financial goals. For the year, sales grew 5%, adjusted EBITDA margin expanded by 130 basis-points and adjusted EPS grew 19% at the high-end of our original guidance. Both our Materials and Solutions Groups delivered strong top and bottom-line results with our base business recovering from downstream inventory destocking in 2023 as expected, strong productivity-driven margin expansion and our high-value categories delivered strong growth, once again demonstrating the strength of the overall franchise. Over the long-term, our overriding objective remains the same to deliver GDP-plus growth and top-quartile returns on capital, a recipe for superior value-creation. In this context, we continue to make strong progress against our 2025 financial targets, despite multiple macro disruptions in recent years. Recall, this represents our fourth set of long-term goals after meeting or beating our previous three sets. As you can see on Slide 6, we have a proven track-record delivering GDP-plus growth, margin expansion and top-quartile returns across cycles, including delivering 9% earnings growth excluding currency so-far in this current cycle. Strategically, we continue to drive outsized growth in high-value categories, enabling us to shift the portfolio to become more differentiated with higher-growth and higher-margin. These categories now represent almost half of our portfolio and accounted for roughly 3 points of organic sales growth annually over the past four years.
Our high-value platforms, excluding intelligent labels, accounted for roughly 2 points and intelligent labels accounted for roughly 1 point. More broadly, our consistent performance reflects the strength and the durability of our portfolio, the resilience of our industry-leading market positions, our agile and talented global team and the consistent execution of our key strategies. This has and continues to provide us multiple levers to deliver strong results and compound earnings in various scenarios across cycles. Our playbook is working well as we execute on our five strategic pillars across both our primary businesses, driving outsized growth in high-value categories, growing profitably in our base businesses, leading at the intersection of the physical and digital, effectively allocating capital and relentlessly focusing on productivity and leading in an environmentally and socially responsible manner. In Materials Group, our highest returns business, we delivered strong top-line growth in 2024, driven by significant volume growth as our markets recovered from inventory destocking in 2023 with strong margin expansion. This reflects continued above-average growth from our high-value categories and presence in emerging markets, two key catalysts for growth over the long-term and ongoing contribution from productivity improvement initiatives.
Our leadership position in our base business remains strong. We continue to differentiate ourselves through quality and service, strong material science and process technology capabilities and sustainable innovation over the long-term. This foundation, along with the breadth of our overall portfolio, provides the platform for us to drive growth as we balance price, volume, mix and share while reducing complexity and tailoring our go-to-market strategies. Our strategy to expand our position in high-value categories, which makes up more than a third of Materials Group sales, including specialty and durable labels, graphics and reflective solutions and industrial tapes is working. We delivered mid-single-digit organic growth for these products in 2024. We continue to help our customers address complex challenges. Our efforts in 2024 resulted in new innovations and portfolio extensions that reduce supply-chain waste, extend product performance and lifespan and foster packaging circularity. A couple of highlights include introducing the first recycle class certified label solution for high-density polyethylene consumer packaging to help brands address growing packaging recyclability and waste regulations and extending our portfolio of liner list solutions to address -- to address a long-standing productivity challenge with our converting partners. On the productivity front, Materials Group continues to consistently deliver. Our focus on material reengineering, lean operating principles and fixed-cost innovation remain key to our success, not just as a means to expand margins, but also to enhance our competitiveness, particularly in our base business and provide a source of funding for reinvestment. In Solutions Group, we delivered strong top-line growth and margin expansion, driven by strength in the base business as apparel industry volumes normalized following destocking in 2023 and growth in high-value solutions.
Overall, apparel growth was strong across all product, customer and format categories, including performance, fast fashion and value. Within high-value solutions, which delivers higher-than-average segment margins, Imbelix grew roughly 25% for the year, including the impact of acquisitions. As a reminder, this growth platform is driven by increased consumer personalization and fan engagement in team sports and growth in performance athletic category. We continue to invest organically in and inorganically in this now roughly $325 million platform that has grown roughly 15% annually on an organic basis over the last six years., our market-leading suite of productivity and media solutions for the retail shelf edge delivered softer than initially anticipated sales in 2024, primarily on lower-volume in the drugstore channel driven by store closures. I'm pleased to announce that we recently signed a new partnership with CVS Health to launch Vestcom shelf-edge solution chainwide with rollout in the first-half of 2025. We expect Vestcom will deliver strong growth in 2025, continuing to deliver above-average growth over the long-term.
Turning to enterprise-wide intelligent labels. As you can see on Slide 11, we grew 9% on an organic basis in 2024, below our initial expectations, reaching roughly $900 million in revenue, including currency translation. Strong growth in apparel categories up roughly 20% and general retail categories up more than 40% was partially offset by a decline in logistics as we lapped the largest RFID program single wave rollout in the industry's history in 2023.
Sales in logistics were lower in 2024 on the year-on-year comparison to the initial program build, typical share normalization and the impact from packages that did not receive RFID-enabled tags earlier in the year. We continue to be the significant majority share provider for this customer on the strength of our partnership and value-creation. Importantly, as we did when we first drove adoption in apparel, we've also captured multiple learnings on the adoption dynamics in this new category that will positively support active pilot expansion and likely conversion in 2026. In food, we announced a strategic collaboration with Kroger in October, focused on making possible more frequent and accurate inventory information to maximize freshness, reducing waste in perishable categories and improving the consumer and associate experience. The collaboration will begin rolling out in the bakery department across the Kroger network in 2025. This will be the first grocer moving to rollout for item-level RFID tagging and represents a significant step forward for our intelligent labels platform and the industry overall in a very large addressable market with significant opportunity for growth in the years to come. Across the enterprise, we expect to deliver 10% to 15% growth in intelligent labels in 2025, contributing 1 to 1.5 points to total company growth as adoption continues in both retail and newer categories. We expect end-market and existing customers to deliver roughly 10% growth and are targeting pipeline conversion to deliver roughly another 5% growth. We expect the pace of growth will increase throughout the year due to the targeted timing of pipeline conversions of key programs. We continue to believe that physical items will need a digital identity to help solve challenges such as labor efficiency and supply-chain effectiveness, waste reduction, circularity and transparency and to help better connect brands and their consumers.
And our competitive advantages here are clear. We provide labeling materials that decorate and provide information on most of the world's items, and we are the market leaders in the most ubiquitous broadly applicable sensing technology in UHF RFID. This, combined with our innovation leadership in our go-to-market strategy uniquely positions us to lead and win in multiple new categories with more than 250 billion units of opportunity at the nascent point of industry growth. As such, we will continue to invest to capture the significant opportunity ahead as we grow the overall industry through both the Solutions and Materials Group. Stepping back, as I reflect after five quarters as CEO, my conviction in the earnings power and returns of our franchise remains high. We have multiple levers individually and collectively that we have proven over-time and through cycles can consistently drive outperformance for our stakeholders. We are exposed to diverse and growing markets largely anchored in consumer staples. We are industry leaders in our primary businesses with clear competitive advantages in scale and innovation. We have a strong foundation in our base business delivering GDP growth and strong free-cash flow. We have clear catalysts for significant long-term growth in emerging markets and in high-value categories that are competitively differentiated with higher margins and which are increasingly a larger part of our portfolio.
We have an engaged global team with a strong innovation and productivity culture that continually learns is agile and adjusts to when and we have a strong balance sheet and disciplined approach to capital allocation that provides us significant investment flexibility to drive earnings growth and expand EVA. Taken together, these levers will enable us to not only continue to deliver on the potential of our business, but also expand that potential moving forward. We remain confident that we will continue to generate superior value-creation through a balance of GDP-plus growth, margin expansion and top-quartile returns over the long-term. In 2025, we expect to again deliver strong earnings growth with adjusted EPS of $9.80 to $10.20, up roughly 10% excluding currency. I want to thank our entire team for their continued resilience, focus on excellence and commitment to addressing the unique challenges in 2024. And with that, I'm now going to hand over the call to Danny. As you likely know, Danny has been with the company for 14 years, leading strategy and M&A and has been a critical thought partner for our leadership team over the last decade. I'd like to thank Danny for stepping in as Interim CFO while Greg recovers. And I'm happy to let you know that Greg has made great progress and we look-forward to his likely return in the spring.
