Saturday 10 December 2016

Smurfit Kappa on track after 'solid' results

Published 05/11/2015 | 02:30

The main plant of timber mill Smurfit Kappa group at the Facture site in Biganos, southwestern France.
The main plant of timber mill Smurfit Kappa group at the Facture site in Biganos, southwestern France.

Packaging giant Smurfit Kappa is on track to meet full-year profit expectations, after delivering what analysts described as a "solid" set of third-quarter results.

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Earnings before interest, tax, depreciation and amortisation (EBITDA) were €305m in the period, in line with consensus expectations.

Excluding the impact of currency fluctuations and acquisitions, underlying EBITDA was up 4pc year-on-year.

Revenue during the three months to the end of September was unchanged at €2.02bn.

Smurfit Kappa, headed by chief executive Tony Smurfit, said that higher revenues in Europe during the period were more than offset by a reduction in the Americas.

This was primarily due to the adoption of the Simadi exchange rate in Venezuela, whose economy has been hammered by the fall in oil prices.

Venezuela effectively devalued its currency against the US dollar earlier this year by introducing the new Simadi free-floating currency platform.

During the first nine months of this year, Smurfit Kappa's EBITDA in the Americas was down €4m.

Earnings growth across the region, partly as a result of acquisitions, was "more than offset by net negative currency movements of €46m, inclusive of a €52m negative impact in Venezuela".

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