05.06.16
Smurfit Kappa Group plc announced results for the three months ending 31 March 31, 2016. The compnay reported sales of €2,001 million, a 2% increase from last year. EBITDA was €281, a 6% incease from 1Q 2015, and a margin of 14%.
Smurfit Kappa Group reported corrugated packaging growth, including acquisitions of 5% with solid underlying volume growth, and growth of 6% in pre-exceptional EBITDA with improved margin at 14%. The company also announced a €40 per ton price increase in European brown kraftliner effective June 15, 2016. Free cash flow was €7 million.
“Solid year-on-year earnings progression in the first quarter of 2016 with 6% EBITDA growth was driven by an improved operating performance and the positive impact of acquisitions completed in 2015,” said Tony Smurfit, Smurfit Kappa CEO. “Our well invested, geographically diversified and vertically integrated operations will continue to provide us with a resilient platform to drive earnings and free cash flows.
“We continue to see good levels of demand for packaging across almost all of the markets in which we operate. During the quarter, currencies had a distorting effect which on a like-for-like basis had a negative translation effect of almost €10 million on EBITDA. In addition, the rebuilds of our Roermond and Sanguesa mills adversely impacted profitability in the quarter. However, both projects will enhance our European system’s cost position and commercial offering.
“Following the completion of over €380 million of acquisitions in 2015, the Group’s focus is on the successful integration of these businesses through 2016 with the capacity for further bolt-on acquisitions. Our capital investment program of over €450 million per annum supports our objective to deliver higher quality packaging and merchandising solutions to our global customers, while continually driving operational efficiencies through our integrated system.
Smurfit Kappa Group reported corrugated packaging growth, including acquisitions of 5% with solid underlying volume growth, and growth of 6% in pre-exceptional EBITDA with improved margin at 14%. The company also announced a €40 per ton price increase in European brown kraftliner effective June 15, 2016. Free cash flow was €7 million.
“Solid year-on-year earnings progression in the first quarter of 2016 with 6% EBITDA growth was driven by an improved operating performance and the positive impact of acquisitions completed in 2015,” said Tony Smurfit, Smurfit Kappa CEO. “Our well invested, geographically diversified and vertically integrated operations will continue to provide us with a resilient platform to drive earnings and free cash flows.
“We continue to see good levels of demand for packaging across almost all of the markets in which we operate. During the quarter, currencies had a distorting effect which on a like-for-like basis had a negative translation effect of almost €10 million on EBITDA. In addition, the rebuilds of our Roermond and Sanguesa mills adversely impacted profitability in the quarter. However, both projects will enhance our European system’s cost position and commercial offering.
“Following the completion of over €380 million of acquisitions in 2015, the Group’s focus is on the successful integration of these businesses through 2016 with the capacity for further bolt-on acquisitions. Our capital investment program of over €450 million per annum supports our objective to deliver higher quality packaging and merchandising solutions to our global customers, while continually driving operational efficiencies through our integrated system.