Smurfit Kappa shares rise on strong results
SHARES in Smurfit Kappa rose as much as 1.5pc this morning after the company reported good results and stable demand so far this year for its paper products.
Smurfit Kappa reported earnings before interest, taxes, depreciation, and amortisation of €240m in the last quarter of 2012. While 2pc less than the same period in 2011, the results were ahead of forecasts.
Smurfit Kappa chief financial officer Ian Curley told reporters that the Dublin-based company has seen fairly stable demand since the end of fourth quarter.
Smurfit recently hiked paper prices in the hope that economic recovery in many markets will enable customers to pay more their packaging.
Mr Curley said the company would get a sense of the success of the recently announced price increase in the next week or two
Davy Stockbrokers said after the results that it was now “very comfortable” with forecasts for 2013.
“Now that the balance sheet is under control, the private equity 'overhang' cleared and the stock paying a 3pc dividend yield, there is no apparent reason why SKG should continue to trade at a 30pc valuation discount to the sector,” Davy said in a note to investors.