Smurfit Kappa annual profit falls, raises dividend on 4Q recovery
Source - SMW
Packaging group Smurfit Kappa posted a 12% fall in annual pre-tax profit after higher raw material costs hurt margins.
The company, however, increased its final dividend after earnings in the fourth quarter rose and margins improved.
Pre-tax profit for the year through December fell to €576m, from €654m in 2016.
In the fourth quarter, pre-tax profit increased by 4% to €161m as the company continued passing higher input costs through to customers via price rises.
The company declared a final dividend of 64.5c per share, up 12%.
'Our full year result was delivered against a backdrop of an increase in excess of €120 million in recovered fibre costs, generally higher raw material costs and adverse currency movements,' chief executive Tony Smurfit said.
'This improved result for the year, and more importantly for the fourth quarter, reflects the benefits of our continued focus on offering our customers cost effective and innovative solutions, our capital expenditure program, input cost recovery through paper and box price increases and generally strong markets.'
'We also continue to benefit from the group’s geographic reach and integrated model, which support our customers by ensuring security of supply in very tight markets.'
'While we continue to experience currency volatility, wage inflation as well as higher energy and other input costs, 2018 has seen the continuation of good demand in Europe, further input cost recovery and signs of improvement in our Americas business.'