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Interim Results

Smurfit Kappa's Q1 pretax profit falls 15%

05 May 2017 07:23

Smurfit Kappa's Q1 pretax profit fell 15% to €109m, from €128m.

Its revenue for the period was €2.13bn, up 6% from €2.0bn. EBITDA was €278m, down 1% from €281m.

CEO Tony Smurfit said these results, against a backcloth of significant recovered fibre cost inflation of about €30m year-on-year, reflected the continued strength of our business.

"We expect improved margins as paper price increases translate into higher box prices," he said in a statement.

In Q1, corrugated volumes were generally good across most markets with the group recording growth of 3%.

"With solid demand, tight inventories and higher input costs, containerboard prices across all grades have been, and continue to be increased," said Smurfit.

"These increases have provided the backdrop for necessary box price increases which will be progressively implemented during 2017."

The company's cash flow and debt ratios improved in what was traditionally a softer quarter.

"The geographic spread of our business, the integrated model which we operate, the strongest suite of business applications in our industry, and, most importantly, the tremendously talented people that work in SKG, give us great confidence for our future," said Smurfit.

"While there are always political and economic risks, and individual markets invariably have challenges from time to time, we are increasingly well positioned to capitalise on a positive pricing environment in 2017."

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Related Company: SKG

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