Smurfit Kappa profit rises to beat estimates
Smurfit Kappa says it is already seeing fallout from the political rise of Donald Trump, through volatility in Mexico's peso linked to campaign rhetoric.
The Irish corrugated packaging group announced a well received set of third-quarter earnings yesterday, with profit and revenue both up in the three months to the end of September.
Pre-tax profits were up 13pc to €187m on the back of a more modest rise in sales to €2.05bn from €2.02bn in the period. Earnings before interest, tax, depreciation and amortisation (ebitda) rose to €323m from €305m a year ago. But the company said it may change its acquisition focus away from the US, in the event of a Donald Trump electoral victory, fearing increased protectionism.
The Trump campaign is already having an effect.
"Where we see a Trump/Clinton impact is in the performance of the Mexican peso. It's an economy that is performing but is hampered by the peso reaction [to the US presidential campaign]," Smurfit Kappa chief financial officer Ken Bowles said yesterday.
Mr Trump's anti-Mexican rhetoric has been a stark feature of the election. Ken Bowles said free cash flow will help fund a mix of deleveraging, acquisitions, investment and dividends into next year. Shares were up 4pc yesterday in London at 1831 pence each.