6th Nov 2013 12:57
LONDON (Alliance News) - Packaging giant Smurfit Kappa Group PLC Wednesday reported higher profits and revenues for the third quarter of the year, as a strong performance from the Americas, offset a weaker European market and higher central costs.
The paper-based packaging manufacturer reported a 2% increase in its pretax profit for the three months to September 30, to EUR104 million, compared with EUR102 million a year earlier.
It said that the Americas region helped drive a better earnings performance in the third quarter, while Europe has begun to show some signs of pricing recovery.
It reported revenue growth of 10% year-on-year in the third quarter, to EUR2.02 billion.
The group acquired UK specialty business, CRP Print and Packaging Holdings Limited in October, and recently completed the redemption of EUR500 million 7.25% Senior Notes due 2017, which was funded by a combination of cash and existing credit facilities
The group reported higher revenues for the first nine months of the year, but saw a 19% drop in its pretax profit to EUR231 million, from EUR286 million the prior year, due to higher costs of sales, distribution costs and administrative expenses. It reported a net profit of EUR128 million for the nine month period.
It said that its margins at the end of the first nine months have recovered to 13.8%, largely due to a strong performance in the Americas, and also the benefit of improved containerboard pricing in Europe.
The group reported an 8% increase in revenues for the nine month period, to EUR5.92 billion, from EUR5.51 billion a year earlier. It said that revenues rose 10% in the third quarter, to EUR2.02 billion.
In the Americas, revenue increased by EUR141 million, while earnings before interest, taxes, depreciation and amortisation increased by EUR35 million as a result of strong underlying volume and revenue growth throughout the region, in particular Venezuela.
Smurfit Kappa said that packaging volume growth has remained solid throughout the year, and European box volumes continue to grow ahead of the general market.
Smurfit Kappa shares were trading at 18.28 cents up 4.4% Wednesday morning.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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