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(Alliance News) - DS Smith PLC on Thursday reported a strong half-year ended October 31, posting a jump in profit as it touted its focus on customers' needs amid revenue climbs in Southern Europe and North America.
The London-based packaging firm said revenue rose 28% to GBP4.30 billion from GBP3.36 billion a year before, lifting pretax profit by 82% to GBP322 million from GBP177 million.
Meanwhile, net debt as of October 31 was reduced by 23% to GBP1.15 billion from GBP1.48 billion at April 30, the end of the previous financial year.
DS Smith said the performance was driven by focusing on its customers' needs during a period of significant economic volatility. "This has enabled us to achieve continued market share gains, an increase in profitability and improvements in our key financial performance ratios," said Chief Executive Officer Miles Roberts.
Revenue in Southern Europe jumped 35% to GBP1.67 billion from GBP1.23 billion a year prior, boosted by higher packaging and paper prices. In North America, revenue grew by 30% to GBP355 million from GBP274 million. In Eastern Europe, it was up 24% to GBP648 million from GBP523 million.
Revenue in Northern Europe rose by 22% to GBP1.62 billion from GBP1.33 billion, DS Smith said, due to box price and sale price increases for externally sold paper and volumes of recycled fibre. It noted that the region grew slower than others due to overall economic conditions in the UK and Germany, as well as "very strong growth in the comparative period".
Looking ahead, DS Smith now expects its full-year performance to be ahead of previous expectations, and the second half to be consistent with the first. It announced an interim dividend of 6.0 pence per share, up 25% from 4.8p a year before.
Chief Executive Officer Roberts said: "The macro-economic outlook for the rest of the financial year remains challenging. However, we have an excellent customer base, efficient high quality assets, dedicated colleagues and a strong balance sheet allowing continued organic investment to support our customers. "
In an outlook posted in June, the company had said it anticipated a capital expenditure of around GBP500 million to invest in customer-led growth opportunities for financial year 2023, which it said on Thursday it expects to remain unchanged.
DS Smith shares were 1.0% higher at 320.13 pence each in London on Thursday morning.
By Tom Budszus, Alliance News reporter
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