..A leading supplier of recycled packaging in Europe

With a turnover in 2011/12 of £2.0 billion and employing more than 20,000 people, DS Smith Plc is an international supplier of recycled packaging for consumer goods.

On 30 June 2012 DS Smith acquired SCA Packaging. On a combined basis, the group is now the second largest manufacturer of corrugated products in Europe. We are also a leading worldwide supplier of bag-in-box packaging and a leading European supplier of plastic returnable transit packaging. The combined Group now has revenues of approximately £4 billion (based on a combination of historically reported figures and a 12 month contribution from both businesses).

DS Smith is a FTSE 250 company listed on the London Stock Exchange and headquartered in Maidenhead.

http://www.dssmith.com/

DS Smith (LON:SMDS)

Yesterday, DS Smith reported results for year ended 30th April 2013. Revenue from continuing operations rose 86% to £3.7bn boosted by strong growth across most markets. Adjusted operating profit was 77% up to £250.9m. Profit before tax rose to £86.6m from £21.7m. Earnings per Share (EPS) grew 36% to 17.4p; dividend per share (DPS) also increased 36% to 8.0p. For Western Europe, revenue increased to £966.2m from £569.4m while operating profits almost doubled to £73.4m. Revenue from France increased to £742.9m from £606.6m. The business in Germany, Austria and Switzerland (DACH) and northern Europe was almost entirely driven by the acquisition of SCA packaging. DACH and northern Europe revenues rose to £835.7m from £7.3m while operating profit advanced to £62.4m from £0.3m. The company has recently started operations in Central Europe and Italy. The revenue picked up fast and stood at £601.1m, up from £167.2m. However, the biggest market i.e. the UK was hit by decline in the paper market. Revenues remained almost flat at £961.2m while operating profits declined to £47.6m from £64.4m. The plastics business reported a robust performance with revenues growing to £305m from £265.3m.

Our view: DS Smith witnessed good growth in revenues and profits during the year with a remarkable acquisition of SCA packaging. The revenues and adjusted operating profit soared 86% and 77%, respectively. Acquisition of SCA packaging helped the company to tap major geographies within Europe. Revenue and operating profit in the newly formed geographical markets are rapidly gaining momentum. The plastics business, though a small part of the total business, is growing at a steady pace. The company has been successful in acquiring international technology license which is likely to help in expanding business across multiple geographies in the future. The geographical spread would also help the company in mitigating the impact of country-specific factors on the overall performance. The company has been successful in delivering strong overall results despite a weak European economy and sluggish paper industry. Continuing cost and cash synergies are likely to add to the profitability. The strong growth in EPS and DPS are a major attraction for the investors. We are optimistic about the company’s ability to achieve good revenue and profits growth in the future. We remain Buyers of the stock.


http://www.proactiveinvestors.co.uk/columns/beaufort-securities/13393/beaufort-securities-breakfast-today-including-wood-group-greene-king-and-ds-smith-13393.html

1 Jul Investec 300.00 Buy
1 Jul JP Morgan... 277.00 Overweight

A buy in this weeks IC - DS Smith's savings soar.

DS Smith doubled in size when it bought SCA Packaging for £1.3bn last year, and the benefits keep exceeding expectations. Management unearthed another slug of savings this time ,too, and rewarded investors with a juicier dividend. More savings seem inevitable and the growth in recycling and packaging should offset weak paper markets. Clearly, SCA flatters these results, generating most of the 77% growth in underlying operating profit to £251m. That included 40m euros (£34.2m) of cost cuts, which Smith now will total 120m euros, or 20% more than previous estimates.
Admittedly, most of the extra benefit fell in the year just gone, but there is more to come and that should underpin profit forecasts for 2014.
But there is still work to be done. Integrating SCA cost almost £58m and although volumes there are on ''improving trend'', they're are still no match for Smith's legacy business. And SCA'S inferior returns, plus a paper business that just broke even last year , hammering profits in the UK, dragged group margins below Smith's 7-9% target range. Still, finance director Steve Dryden is confident SCA will improve on this performance.
Broker JP Morgan expects adjusted 2014 pre-tax profit of £208m, giving EPS of 21.8p (from £166m and 17.4p last year).
DS Smith has got net debt below two times cash profits much more quickly than expected and the current year has started well. So, while the shares are up 50% since Feb 2012 , a forward PE of 11.5 , still looks cheap.

Wife of DS Smith CEO sells 5.6m-pound stake

Wed, 24 July 2013


The wife of DS Smith frontman Miles Roberts sold a substantial sum of shares in the packaging and office supplies firm on the same day it was revealed the Chief Executive Officer (CEO) received a big pay increase last year.

The move came on Tuesday, the same day DS Smith released its annual report in which it said the CEO had earned a total of £1.6m for the fiscal year ended April 30th, up from £1.3m the year before.

This included an annual salary of £0.61m and bonuses totalling £0.76m, in addition to pension payments and other benefits.

Gillian Roberts exercised nil-cost options over nearly 2.6m shares and subsequently sold around 2.22m of them at a price of 250.53p each, making a total of nearly £5.6m.

The couple’s total holding following the transaction was left at just under 0.6m shares, equal to a 0.064% stake.

The stock has risen by over 20% so far in 2013.

MIDAS UPDATE: DS Smith tip rewards the brave as packaging group's shares rise

By Joanne Hart, Financial Mail On Sunday

PUBLISHED: 22:05, 27 July 2013 | UPDATED: 22:05, 27 July 2013


Crunch: Miles Roberts focuses on 'retail ready' products

Packaging group DS Smith was one of our tips in January 2011, when the shares were 206p and the firm was at the start of a restructuring under chief executive Miles Roberts.


Roberts did well that year but the shares fell to 193p amid concerns about economic conditions in Europe. We suggested that investors hold and, thankfully, they have been rewarded.


Today, the shares are 2411⁄2p and should continue to rise. The current price is particularly impressive, as the group raised £466 million last year through a heavily discounted nine-for-eight rights issue at 95p a share. Existing shareholders who took up their rights have twice as many shares now as they started off with.


The money was raised to buy rival SCA Packaging, a deal that has already started to deliver benefits, both in terms of cost savings and increased sales.


In June, Roberts unveiled results for the year to April 30 showing an 86 per cent gain in sales to £3.7 billion, a 77 per cent increase in profits to £210 million and a 36 per cent rise in the dividend to 8p. Brokers forecast more strong growth this year, expecting £4.1 billion in sales, profits of £258 million and a 9.2p dividend.


DS Smith used to focus on paper making, a cyclical and commoditised industry. Under Roberts, it has shifted towards packaging, especially for big consumer goods groups such as Nestle and Procter & Gamble, and supermarkets.


The company aims to distinguish itself from rivals, particularly by offering ‘retail ready’ packaging, where products, such as cereal boxes are placed in cardboard packages that can be loaded directly on to supermarket shelves. This makes the entire process, from warehouse to supermarket shelf, quicker, easier and considerably cheaper.

DS Smith does not just design the retail-ready packages; it collects the emptied packages from the supermarkets, sends them to its own recycling plants and recreates them in days, ready for use again. The process is fast, efficient and enhances companies’ environmental credentials.


DS Smith has Amazon as a customer, as well as other retail businesses that are trying to make their packaging more interesting. Internet sales are soaring, retailers are keen to deliver goods in attractive containers and DS Smith can help.


Midas verdict: DS Smith has done well, but there is plenty of mileage left. The SCA deal has brought in new custom, the focus on consumer goods makes the firm less vulnerable to economic shocks and Roberts is keen to make further, small acquisitions if the right opportunities arise. The group also aims to reward shareholders with big dividend rises.


Existing investors should hold while new ones could look to buy.

01 Aug 2013 Smith (DS) PLC SMDS Numis Buy 265.20 259.40 301.00 301.00 Reiterates

SP TARGET 301p

smds

On the verge of a breakout.

Note how RSI and momentum are not
overbought like most other stocks
in this situation.

Leads me to think the breakout will
have a strong follow through.

16 Aug 2013 Smith (DS) PLC SMDS Bank of America Merrill Lynch Buy 0.00 254.10 - 310.00 Reiterates

SP TARGET 310p

Smith (DS): Citi takes target price from 265p to 300p retaining a buy recommendation.

Tuesday's agenda: DS Smith keeping things under wraps
By John Harrington
September 02 2013, 6:30pm
Packaging company DS Smith is not expected to reveal many numbers in its trading statement on Tuesday.



"We believe DS Smith's paper operations remain around the break-even point but the recent paper price rises do add modest upside risk to numbers if prices can be maintained," UBS said.

"Further details on SCA Packaging integration progress may be offered with revenue synergies potentially being discussed although we believe more colour is likely to be offered at the capital markets day in Brussels on 6th September," the Swiss bank speculates.

McBride, which makes "own brand" personal care and household products for supermarkets, has already indicated it will reveal a decline in full-year revenue of 5% on a constant currency basis.

Panmure Gordon is forecasting a 6.7% decline in revenue to £760mln and a 24% decline in adjusted profit before tax to £18.0mln. The median forecasts for analysts following the stock are £772mln for revenue and £21.3mln for profit before tax.

The consensus view is that the full-year dividend will be nudged up to 5.29p but Panmure Gordon is expecting nothing more than an unchanged pay-out from last year.

"The impact of lost toll manufacturing contracts, a deterioration in major Western European markets and a period of intense promotional activity in the UK all weighed on FY 2013E’s profitability," the broker notes.

Next year should be better for the group, Panmure Gordon believes.

Interim Management Statement

RNS


RNS Number : 0604N

Smith (DS) PLC

03 September 2013




3 September 2013

DS Smith Plc - Interim Management Statement

DS Smith Plc, the leading supplier of recycled packaging for consumer goods, today issues its Interim Management Statement in respect of the three month period to 31 July 2013. DS Smith will hold its Annual General Meeting at 11am today.



Trading



The current year has started well and in line with our plans, driven by a good performance throughout the Group and the continued strong delivery of the previously announced synergies from the acquisition of SCA Packaging. Return on sales and ROACE have continued to improve, as anticipated.



Our Packaging business has performed as expected, despite the European markets remaining challenging. Corrugated volumes have continued to improve, with growth fully in line with our medium term financial target of GDP +1%, reflecting the increasingly positive customer reaction to our differentiated and strong value proposition as we leverage our enlarged and strengthened geographic footprint.



There has been no significant change in DS Smith's financial position during the period.



Outlook



Our overall outlook remains positive, as we continue to grow our business and deliver the synergies from the SCA Packaging acquisition, although as previously indicated there is the expected short term impact ahead of the pass through of input cost increases. The Group expects continued performance in line with the Company's medium term financial targets and views the remainder of the year with confidence.



Miles Roberts, Group Chief Executive, said:



"The year has started well and in line with our plans. Increasing volume growth fully in line with our medium term targets reflects continued innovation driven market share gains and, together with the delivery of synergies from the SCA Packaging acquisition, underpins our confidence for the year. Whilst the European market backdrop remains challenging, we are on track to make further significant progress this year and are excited about the growth opportunities for the Group."



Conference Call



A conference call for analysts and investors, hosted by Miles Roberts, will take place today, 3 September 2013 at 08.00 BST. The dial-in number is:

UK / International +44 (0)20 3003 2666

UK Toll Free 0808 109 0700

Password DS Smith



A play-back facility of this call will be available until 10 September 2013. The dial-in number is: +44 (0)20 8196 1998, access pin 2397506. A recording and transcript of the call will also be available through the Investor Relations section of our website: www.dssmith.uk.com



Capital Markets Event



The Company will be hosting a presentation for financial analysts and institutional investors in Brussels on 6th September 2013. No new material information will be disclosed and copies of the presentations will be available on our website www.dssmith.comfollowing the event.



Forthcoming Dates


Q2 trading update

Results for the half year to 31 October 2013

1 November 2013

5 December 2013

Questor share tip: DS Smith upgraded to a buy on strong trading
TelegraphBy John Ficenec | Telegraph – 1 hour 50 minutes ago..


Strong trading at packaging group DS Smith (LSE: SMDS.L - news) makes the shares with a fast growing dividend well worth snapping up, says Questor

DS Smith 267½p-2½ Questor says BUY

A STRONG start to the year’s trading at recycled packaging group DS Smith means the shares are looking increasingly attractive. The FTSE 250-listed group offers some stellar dividend growth and has wrapped up the first quarter with a confident outlook.

DS Smith manufactures recycled cardboard boxes that are used to hold products such as washing-up powder and tinned tomatoes on supermarket shelves. DS Smith’s fortunes are therefore linked to the sales of consumable products, or fast-moving consumer goods, made by global players such as Nestle (VTX: NESN.VX - news) and Reckitt Benckiser (Xetra: A0M1W6 - news) .

There are encouraging signs coming out of mainland Europe. The eurozone manufacturing indices announced a two-year high on Monday. This is good for DS Smith as it aims to deliver growth of GDP plus 1pc. The group said that packaging volume growth had accelerated during the first quarter, ended July 31, and was now above its targets. This improved trading will be boosted by recent acquisitions.

The packaging group made a bold expansion move last year. DS Smith bought Swedish rival SCA packaging in a €1.6bn (£1.35bn) deal, greatly expanding its footprint across northern Europe. The group now has three-quarters of its business focused in Europe. The impact of the deal can be seen in the table with a step change in revenues during 2012, while the profit impact lagged by a year due to restructuring and other deal costs.

The benefits of the SCA deal are ahead of schedule. DS Smith now expects to make €120m in cost savings over three years from joining the two groups. It had initially expected to save €75m a year after three years.

Dividend growth is a major reason for investors to take a look at DS Smith. “We are here to pay dividends and in a consistent fashion.” said Miles Roberts, chief executive. That isn’t just bluster either as, for the past three financial years, the dividend has grown by an annual average of 36pc. That growth is forecast to slow slightly in the years ahead but should still easily beat inflation. And on the concensus forecast 2014 dividend, the shares offer a handy yield of 3.5pc, rising to 4pc next year.

That dividend is looking secure. At the most recent full-year results the dividend was covered by more than 2.2 times earnings and over 3.7 times by the free cash flow. Mr Roberts said he wants to keep the earnings cover between 2 and 2.5 times earnings. So there is plenty of scope for more increases if the full-year figures match the encouraging start.

Increasing prices should improve profitability into rest of the year. DS Smith has managed to put through a round of paper price increases, which have increased profit margins. Mr Roberts said: “Price increases typically have around a four-month lag on profit performance.” So, if they hold into the second half, it is likely that analysts will have to upgrade numbers after the second-quarter trading update due on November (Xetra: A0Z24E - news) 1.

Shares in DS Smith have had an excellent run. They are up 29pc in the year to date. That means they trade on a 2014 earnings multiple of 12.6 times, falling to 10.2 times next year.

Given the group’s exposure to Europe, a wobble in the region would hurt as earnings per share need to grow by 27pc in the year ahead to reach targets. However, manufacturing indicators are encouraging and that dividend growth is too good to ignore. Questor upgrades to a buy.

Smith (DS): JP Morgan raises target price from 277p to 308p and retains an overweight rating.

Smith (DS): Investec moves target price from 300p to 320p retaining a buy recommendation

DS SMITH PLC - 2013/14 HALF YEAR RESULTS


Highlights

· Market share gains driving organic corrugated packaging volume growth of +2.2%, led by good growth in areas of focus; - Germany and CEE

· Improved performance across our key operational metrics

· Return on sales progression of 40bps to 7.7% despite input cost pressures

· Synergy benefits from SCA Packaging acquisition fully on track

· Results in line with our medium-term targets


http://www.moneyam.com/action/news/showArticle?id=4719096

Broker snap: Investec sees upside risk to forecasts at DS Smith

Thu, 05 December 2013


Investec has upped its target price for DS Smith from 340p to 350p after a better-than-expected first half from the packaging group, saying there is now upside risk to full-year forecasts.

The broker retained its 'buy' recommendation for the shares.

Revenues came in at £2,081m during the first six months of the year, up 25% year-on-year and 1.5% ahead of Investec's forecast. Meanwhile, adjusted operating profit jumped 31% to £160.2m, 4.7% above estimates.

"We see these interim results as very solid, driven by improving volumes and market share gains, in line with the medium term targets. The recent input price increases, while a short-term headwind, do present an opportunity to sell innovation and reduce paper content in the box.

"We leave estimated 2014 fiscal year forecasts unchanged, but with upside risk and being mindful of the first half bias. We expect to upgrade our estimates for the 2015 fiscal year adjusted operating profit by approximately 2% towards £340m," the broker said.

Numis Securites also upgraded its rating for DS Smith from 'hold' to 'add', saying that the business as a positive near- and long-term outlook.

The broker has 349p target price for the stock, valuing it at 14 times full-year earnings for the year ending April 2014 (24.9p).

"Our 14x rating reflects the improving return on capital employed and the opportunities for growth in an industry which now has much improved capital discipline."

The stock was 6.35% higher at 318p by 11:18 on Thursday.

A buy in this weeks IC - DS Smith on target.

Broker Investec Securities expects full year adjusted pre-tax profit of £259m, giving adjusted EPS of 21.3p from £211m and 17.3p in 2013. DS Smith continues to generate organic growth and expects another 60 million euros of cost savings over the next 18 months. Higher paper prices will be recovered in time, too. Smith's shares still trade on a not overly pricey 15 times forecast earnings.

Smith (DS): Berenberg starts with a target price of 400p and a buy recommendation

Smith (DS): Canaccord Genuity initiates with a target price of 370p and a buy recommendation.

Interim Management Statement

RNS


RNS Number : 6368B

Smith (DS) PLC

06 March 2014






6 March 2014

DS Smith Plc - Interim Management Statement

DS Smith Plc, the leading supplier of recycled packaging for consumer goods, today issues its Interim Management Statement in respect of the three month period to 31 January 2014.



Trading



The business has continued to perform well, in line with our plans, driven by growth across the Group and the ongoing delivery of the previously announced synergies from the acquisition of SCA Packaging.



Like-for-like corrugated box volume growth has remained good and ahead of our medium term financial target of GDP +1%, with Germany and Central and Eastern Europe particularly strong. This volume growth reflects a strengthened customer proposition, driven by innovation and removing complexity and cost from our customers' supply chain. The pass through of input cost rises to date, with the usual short-term impact, has been as expected. Return on sales and ROACE continue to improve as the benefit of synergies flow through.



There has been no significant change in DS Smith's financial position during the period.



Outlook



Our outlook remains positive. Volumes continue to grow and the pass through of increased input costs remains ongoing. The Board expects performance in line with our medium term financial targets and views the remainder of the year with confidence.



Miles Roberts, Group Chief Executive, said:



"The year has continued in line with our plans, despite market conditions remaining difficult. We are continuing to grow volumes in these competitive markets, as our customers seek to consolidate their supplier base, by offering a complete service from design and production right through to supply and recycling via our closed loop model, delivered across Europe. DS Smith's recycled corrugated packaging offers our customers the opportunity to package their products in a cost effective material that provides consistent quality both in their supply chain and the retail environment. As such, we continue to see opportunities for growth in this market and are confident in the prospects for the business."