DS Smith’s (SMDS) strong first half boosts stock price
10:22, 9 December 2021
UK sustainable packaging and recycling specialist DS Smith (SMDS) has reported strong first half numbers for the half year to end of October 2021.
The London-based company revealed pre-tax profit of £175m – up 80% and revenue of £3.36bn ($4.43bn) – up 16% on the same period in 2020.
Interim dividend per share is 4.8p – up 20%.
The company’s stock price rose in mid- morning trading on the back of the positive numbers – up 1.29% to 385.70p.
The company said that in a challenging supply chain environment, its large scale, security of supply and high service levels had driven ongoing gains with large multinational customers.
Commenting on the latest figures, Miles Roberts, Group Chief Executive for DS Smith, said: “We are continuing to benefit from a very dynamic market with demand for packaging for different retail solutions evolving rapidly and COP26 intensifying the desire for sustainable packaging solutions for the circular economy.
Growth in US and Southern Europe
He added: “Our leadership in these areas has contributed to record volumes with particularly strong growth in the US and Southern Europe regions, where we have invested recently, as well as with our multi-national FMCG customers.
“In a challenging operating environment, I am pleased to see good progress. Our supply chains have remained secure and the significant increases in input costs have been mitigated by effective hedging of energy cost, our long term supplier agreements and raising packaging prices.
Roberts concluded: “We have built a business to benefit from the significant structural growth drivers within fibre based corrugated packaging. These benefits, combined with our scale, geographic footprint, sustainability and innovation focus, position us very well for continued volume and market share growth.
“Together with pricing momentum, this underpins our confidence to deliver a significant improvement in profitability during the second half of this year in line with our expectations and towards our medium-term targets”.