5th Dec 2019 08:16
(Alliance News) - DS Smith PLC on Thursday reported an improved performance in the first half of its current financial year and said it expects further growth in the remainder.
The FTSE 100-listed packaging firm said pretrax profit grew by 31% in the six months to the end of October to GBP213 million, as revenue climbed by 3.9% to GBP3.19 billion. On a constant currency basis, revenue increased by 3%.
DS Smith said acquisitions boosted revenue growth, while recycling volumes continued to be hurt by lower export demand from Asian markets.
In addition, the company said sales prices within the paper and recycling businesses were lower year-on-year. These decreases were partially offset by modest growth in corrugated box volumes, DS Smith added.
"Our leadership in e-commerce and sustainable packaging solutions has enabled us to perform well despite a difficult macro environment and volatility in paper pricing," explained Chief Executive Miles Roberts.
Back in March, the company had agreed to sell its Plastics division to Olympus Partners for USD585 million. On Thursday, DS Smith said it expects to complete the transaction around the end of 2019.
DS Smith declared an interim dividend of 5.4 pence a share, up 4% year-on-year.
Looking ahead, Roberts added: "Assuming current macro-economic conditions prevail, we anticipate an acceleration of volume growth in the second half of the year which, together with the resilience of our business model, supports our expectation of further growth in the year."
DS Smith shares were trading 4.9% lower in London on Thursday morning at 360.50p each, making it the worst performer in the blue-chip index.
By Evelina Grecenko; [email protected]
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