08.04.17
Smurfit Kappa Group plc announced results for the three and six months ending June 30, 2017. Smurfit Kappa reported revenue growth of 5% for the first six months, with strong demand in most markets. Second quarter EBITDA was €292 million with increased sequential EBITDA margin of 13.9%
Kraftliner demand was robust, with an additional €50 per ton price increase implemented in the third quarter. Containerboard price increases are feeding through to corrugated price recovery.
“We are pleased to report a good set of results for the first half, which were achieved against a backdrop of continued and unprecedented recovered fibre cost inflation of approximately €75 million year-on-year,” Tony Smurfit, Group CEO, reported. “We are in the process of recovering these input costs as we move through the remainder of 2017 and into 2018. The Group reported sequentially improved EBITDA margins at 13.9% with both Europe and the Americas delivering improvement as a result of corrugated price recovery.
“In Europe we have seen a strong demand environment in the second quarter, leading to a first half increase in absolute corrugated volumes of over 2.5% with growth of 5% for the second quarter on a days adjusted basis,” Smurfit added. “In the Americas, the Group reported strong volume growth in Colombia, Mexico and Brazil while Argentina and Venezuela remained challenging.
“As a result of the containerboard price increases in the first half of the year, we began, in the second quarter, increasing corrugated prices in Europe and the Americas and these increases will be progressively implemented throughout the remainder of the year and into the first quarter of 2018,” he noted. “However, shortage of supply and unabated input cost pressures in both regions have necessitated further containerboard price increase announcements for implementation in the third quarter. This will require a further round of corrugated price increases in the fourth quarter and beyond.”
Kraftliner demand was robust, with an additional €50 per ton price increase implemented in the third quarter. Containerboard price increases are feeding through to corrugated price recovery.
“We are pleased to report a good set of results for the first half, which were achieved against a backdrop of continued and unprecedented recovered fibre cost inflation of approximately €75 million year-on-year,” Tony Smurfit, Group CEO, reported. “We are in the process of recovering these input costs as we move through the remainder of 2017 and into 2018. The Group reported sequentially improved EBITDA margins at 13.9% with both Europe and the Americas delivering improvement as a result of corrugated price recovery.
“In Europe we have seen a strong demand environment in the second quarter, leading to a first half increase in absolute corrugated volumes of over 2.5% with growth of 5% for the second quarter on a days adjusted basis,” Smurfit added. “In the Americas, the Group reported strong volume growth in Colombia, Mexico and Brazil while Argentina and Venezuela remained challenging.
“As a result of the containerboard price increases in the first half of the year, we began, in the second quarter, increasing corrugated prices in Europe and the Americas and these increases will be progressively implemented throughout the remainder of the year and into the first quarter of 2018,” he noted. “However, shortage of supply and unabated input cost pressures in both regions have necessitated further containerboard price increase announcements for implementation in the third quarter. This will require a further round of corrugated price increases in the fourth quarter and beyond.”