..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/

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."

Sharecast - Comments from JPMorgan Cazenove gave consumer packaging group DS Smith a boost on Wednesday, saying that the recent de-rating of the stock has created an opportunity for investors ahead of a trading update later this month. JPMorgan reiterated its ‘overweight’ recommendation and 355p target price for the stock.

Since the start of February, DS Smith’s share price has fallen by 6.7%, underperforming its peers, and it now trades at similar valuation multiples to others in the sector. “Yet, in our opinion, deserves a premium on account of its lower cyclicality and lower capital intensity,” the bank said.

Pre-close statement

RNS


RNS Number : 8344F

Smith (DS) PLC

30 April 2014






30 April 2014

DS Smith Plc - Pre-close statement

DS Smith Plc, the leading supplier of recycled packaging for consumer goods, today issues its pre-close trading statement for the year to 30 April 2014.

Summary

Group performance has been in line with our expectations, driven by growth across our businesses and the ongoing delivery of the previously announced synergies from the acquisition of SCA Packaging. The market and business trends from our Interim Management Statement of 6 March 2014 have continued.

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 continuing to be particularly strong. This growth reflects a strengthened customer proposition, driven by innovation and removing complexity and cost from our customers' supply chains. Return on sales and ROACE continue to improve as the benefit of the combined businesses flow through.

Our outlook remains positive and the Board expects continued performance in line with the Company's medium term financial targets.

Miles Roberts, Group Chief Executive, said:



"We are pleased with the performance of the business in the year, despite market conditions remaining difficult. The strength of our business model is shown by the continued increase in volumes as our customers seek to consolidate their supplier bases. Our complete service from design and production right through to supply and recycling, delivered across Europe, provides our customers with the opportunity to package their products in a recycled, cost effective material that provides consistent quality both in their supply chain and the retail environment. We continue to see opportunities for growth in this market and are confident in the prospects for the business."



Conference call

There will be a conference call at 08:00 today for analysts and investors, hosted by Miles Roberts, Group Chief Executive, and Adrian Marsh, Group Finance Director. Dial-in details:

Standard International Access : +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 7 May 2014. The dial-in number is: +44 (0)20 8196 1998, access pin 3563988. A recording and transcript of the call will also be available through the Investor Relations section of our website: www.dssmith.com

30 Apr Davy Research N/A Underperform
30 Apr Goodbody N/A Hold
30 Apr Berenberg 400.00 Buy

Telegraph -
Mid-cap share tip of the week: DS Smith

Each week, a fund manager tells us of a favourite medium-sized company. This week: recycled packaging firm DS Smith


Under new EU regulations, waste paper, metal, plastic and glass must be collected separately by councils – and if not, councils must prove that it is all of a similar quality to what’s collected separately.

D S Smith provides corrugated packaging solutions, such as cardboard boxes, as well as recycling services, for major companies Photo: Getty Images


After trebling shareholders’ money over the past five years, recycled packaging firm DS Smith has become a victim of its own success, with some fund managers taking profits and selling down their positions at the start of 2014.


But Tom Becket, who runs money for Psigma Investment Management, believes the selling and share price falls have been overdone. Over three months shares have fallen 9pc to trade at 312p last week, which Mr Becket said should tempt investors to buy.


“The company has gained substantial market share in northern Europe, through acquisitions. With a strong balance sheet the firm could easily do more transactions that are immediately accretive to their earnings,” he said. “The share price has recently come back, but those buying in now will be getting a cheaper price and a healthy yield at 3pc.”


DS Smith provides corrugated packaging solutions, such as cardboard boxes, as well as recycling services, for major companies such as Nestlé.


Mr Becket said: “The company could one day be a one-stop service for Europe-wide companies, such as major supermarkets. This potential organic growth is currently underappreciated by the investment community and could lead to earnings surprises in the years ahead.”

DS SMITH PLC - 2013/14 FULL YEAR RESULTS

Highlights

· Strong growth in profits, returns and dividends

· Organic corrugated packaging volume growth of +2.2% driving market outperformance, led by good growth in areas of focus

· Return on sales progression of 80bps to 7.6% despite input cost pressures

· Synergy benefits from SCA Packaging acquisition fully on track

· Continued delivery of our medium-term targets

· Investment to support further growth and efficiency




http://www.moneyam.com/action/news/showArticle?id=4836476

DS Smith "ticks all the boxes", Investec reiterates 'buy'

Thu, 26 June 2014



In spite of the negative reaction to DS Smith's annual results on Thursday, Investec has recommended investors 'buy' shares of the consumer goods packaging group after its report "tick[ed] all the boxes".

"We see these full-year results as solidly in line with our and consensus expectations in what remain difficult end markets," the broker said.

Pre-tax profit surged to £167m in the 12 months to April 30th from £82m a year earlier as revenue increased 10% to £4.03m. Earnings per share climbed 25% to 21.4p.

Organic corrugated packaging volumes grew 2.2%, ahead of the corrugated packaging market.

"Corrugated box volumes were broadly stable during the second half, ahead of target and show continued market share gains," Investec said.

The broker has placed its 390p target price for the shares under review.

Despite the positive comments, the stock was down nearly 5% at 290.2p by 10:25 on Thursday.

Questor share tip: DS Smith a buy as profits double

The recycled packaging maker has benefited from “particularly strong” volume growth in Central Europe and Italy, but a weak euro could hurt future earnings





Unilever, the Persil maker, is aware that job applicants 'are consumers too', according to a spokesman.

DS Smith said a change of one euro cent in the pound/euro exchange rate affected pre-tax profit by about £1.2m.



By Rebecca Clancy

6:00AM BST 27 Jun 2014




DS Smith
287.3p-18
Questor says BUY


It has been a strong year for DS Smith, the recycled packaging maker whose customers include Procter & Gamble, Nestlé and Unilever, which has reported a doubling in its pre-tax profits.


The FTSE 250 company saw its profits rise 104pc to £167m from £82m in the 12 months to April 30, on revenues of £4.03bn, up 10pc from £3.7bn. Volumes grew 2.2pc ahead of the rest of the corrugated packaging market, in which it specialises, which was ahead of its target of 1pc.



The company said it has benefited from “particularly strong” volume growth in Central Europe and Italy, where it has won new customers and expanded services to existing clients.


Revenues were also boosted by Swedish packaging firm SCA Packaging, which DS Smith acquired in 2012. The latest results included 12 months of earnings from the Swedish company, compared with 10 in the previous year.

However, despite the jump in profits and revenues the shares fell 5.9pc yesterday after the company warned that results in the coming year could be restrained by a weaker euro and conditions in Europe, which it sees as remaining “challenging”. DS Smith manufactures recycled cardboard boxes that are used to hold products such as washing 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.

“These results have been achieved despite economic conditions across Europe remaining challenging, with the significant pressure on household budgets affecting the entire supply chain,” said Miles Roberts, chief executive.

The company generates about 65pc of its earnings in euros and more than 70pc of its revenue comes from outside of the UK.

DS Smith said a change of one euro cent in the pound/euro exchange rate affected pre-tax profit by about £1.2m.

Justin Jordan, analyst at Jefferies, estimated a 3pc to 4pc hit in the current fiscal year due to the strong pound, while maintaining a “hold” rating on the stock.

Thomas Rand, analyst at Investec, said he expected the euro weakness to trim roughly 2pc of its forecast for earning per share, but said DS Smith remained a “top pick” for the year and maintained his “buy” rating on the stock.

Overall, the current financial year has “started well” and is in line with expectations, Mr Roberts said, despite anticipation that the “difficult consumer economic environment” will remain.

However, there are encouraging signs coming out of mainland Europe.

In the latest set of Purchasing Managers’ Index (PMI) data from the region, “peripheral” Europe — including the countries that were hit the hardest by the global financial crisis — saw output accelerate and growth was at the strongest since August 2007. Across the whole of the eurozone, new orders showed the largest increase since July 2007.

It is also worth noting that the company has raised its dividend again, up 25pc to 10p for the full year.

While the road to recovery in Europe and the UK may not be smooth, the encouraging manufacturing data and strong dividend growth make for a compelling investment.

Questor maintains its Buy rating.

Jefferies sees lower 2015 profit for DS Smith

Wed, 02 July 2014


Jefferies International has reduced its profit forecasts for DS Smith, but says the recycled packaging maker could cash in on acquisitions.

Jefferies said it was cutting its 2014/15 annual pre-tax profit and earnings per share forecasts by 5% to £281.3m and 23p respectively in light of foreign exchange and economic pressure in Europe. It also reduced its price target to 310p from 335p.

Shares in the group, whose clients include consumer goods giants such as Unilever and Nestlé, have fallen nearly a tenth since June, when it reported higher annual profits but said it expected the consumer economic environment to stay tough.

Jefferies advised investors to 'hold' the shares, however, saying the group could cash in on medium-term opportunities including a Eurozone economic recovery, ongoing market share gains and potentially earnings-enhancing mergers and acquisitions.

Shares in DS Smith climbed 5p or 1.8% to 285.4p at 13:06.

Recently appointed non-exec takes stake in DS Smith

Mon, 14 July 2014

Price: 267.60

Chg: 3.30

Chg %: 1.25%


Recently appointed Non-Executive Director of DS Smith, Ian Griffiths, on Monday purchased 15,000 shares, marking his first stake in the consumer goods packaging firm.

The shares were bought for 266.60p apiece for a total spend of £39,990.

The deal comes a few weeks after FTSE 250 DS Smith revealed its full-year profit had more than doubled, despite challenging economic conditions across Europe.

Pre-tax profit surged to £167m in the 12 months to April 30th from £82m a year earlier, as revenue increased 10% to £4.03m. Earnings per share climbed 25% to 21.4p.

Organic corrugated packaging volumes grew 2.2%, ahead of the corrugated packaging market. It said volume growth has been particularly strong in its Central Europe and Italy region after new customer wins and expanding services to existing customers.

Questor share tip: DS Smith shares look oversold

The FTSE 250 listed packaging group has suffered a selloff this year and it looks overdone, says Questor



Market consensus is for DS Smith to increase pre-tax profits to £271m, on revenue of £4.12bn in the year ended April

Market consensus is for DS Smith to increase pre-tax profits to £271m, on revenue of £4.12bn in the year ended April Photo: ALAMY

By John Ficenec, Questor editor

6:00AM BST 07 Aug 2014

DS Smith
259.6p-3p
Questor says BUY


SHARES in recycled packaging maker DS Smith [LON:SMDS] have slumped by more than 20pc this year as costs rise and foreign currency movements hit profit forecasts. But Questor thinks the shares are now looking oversold and investors should stick with the chunky dividend income.


The FTSE 250 company, whose customers include Procter & Gamble, Nestlé and Unilever, warned during its full-year results in June that results in the coming year would be hit by a weaker euro and price competition across the European marketplace.


That sent shares down almost 6pc on the day; they have fallen by more than 20pc in the two months since.


The company generates about 65pc of its earnings in euros and more than 70pc of its revenue comes from outside of the UK. DS Smith said a change of one euro cent in the pound/euro exchange rate affected pre-tax profit by about £1.2m.

The packaging group manufactures recycled cardboard boxes that are used to hold products such as washing powder and tinned tomatoes on supermarket shelves and the rising price of paper and cardboard has also eaten into profitability.

DS Smith’s debts have increased following the deal to buy Swedish packaging firm SCA Packaging in 2012: net debt increased to £827m at the end of April.

That said, DS Smith’s sales are linked to consumable products and fast-moving consumer goods.

Stocks with exposure to consumer goods are seen as a good defensive bet during a downturn: people will continue buying cleaning products long after they have reined back luxury purchases, meals out and gifts.

Market consensus is for DS Smith to increase pre-tax profits to £271m, on revenue of £4.12bn in the year ended April, giving 24.2p in earnings per share. That leaves the shares trading on 10.8 times forecast earnings and looking oversold.

DS Smith now trades at a 10pc discount to sector peer Mondi and the wider European packaging sector. The shares are now down slightly on our initial advice (Buy, 267.5p, September 4).

While investors wait for a recovery there is also a prospective dividend yield of 4.3pc on offer, and that dividend is covered more than twice by earnings and almost twice by free cashflow. Questor maintains the long term view on DS Smith: buy.

11 Sep Jefferies... 310.00 Hold

Interim Management Statement

RNS


RNS Number : 8643R

Smith (DS) PLC

17 September 2014






17 September 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 period since 1 May 2014. DS Smith will hold its Annual General Meeting at 11am today.



Trading



The business has made good progress since the start of the year and performance has been in line with our plans. Like-for-like corrugated box volumes have improved in all our regions, with growth ahead of last year's rate and our medium term financial target of GDP +1%. This growth reflects strong customer support for our proposition, driven by our focus on product and service innovation and removing complexity and cost from our customers' supply chains. Return on sales and ROACE continue to improve, benefiting from the organic growth together with the ongoing delivery of previously announced synergies from the acquisition of SCA Packaging.



Financial position



On 1 September 2014, we completed the previously announced disposal of our Scandinavian foam business for £24 million. We concluded our 2013 triennial pension review, with the ongoing cash contribution schedule to the pension fund remaining unchanged.



Outlook



Our outlook remains positive as volumes continue to grow, despite competitive market conditions. The Board expects continued performance in line with our medium term financial targets and views the remainder of the year with confidence.



Miles Roberts, Group Chief Executive, said:



"We continue to make significant progress in developing our differentiated offer for customers in the UK and Continental Europe. Volume performance has been strong as pan-European customers seek to consolidate their supplier bases and recognise the need for well-designed, recycled packaging at the in-store point of sale, where the buying decision is increasingly being made. Notwithstanding continued headwinds in many of our markets, performance has been in line with our plans. The market remains fragmented, providing ongoing opportunities for growth and we are confident in the prospects for the business."



Conference Call



A conference call for analysts and investors, hosted by Miles Roberts, will take place today, 17 September 2014 at 8.00am London time. 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 24 September 2014. The dial-in number is: +44 (0)20 8196 1998, access pin 9303748. A recording and transcript of the call will also be available through the Investor Relations section of our website: www.dssmith.com/investors.



Forthcoming Dates


Half year trading update

Results for the half year to 31 October 2014

6 November 2014

4 December 2014

17 Sep Investec 380.00 Buy
17 Sep JP Morgan... 368.00 Overweight

Questor share tip: DS Smith has strong start

The FTSE 250 listed packaging group has a good start to the new financial year sending shares higher, says Questor


Market consensus is for DS Smith to increase pre-tax profits to £271m, on revenue of £4.12bn in the year ended April

Market consensus is for DS Smith to increase pre-tax profits to £271m, on revenue of £4.12bn in the year ended April Photo: ALAMY








By John Ficenec, Questor editor

6:00AM BST 18 Sep 2014



DS Smith
286.9p+13.9p
Questor says BUY


SHARES in recycled packaging maker DS Smith [LON:SMDS] jumped more than 5pc yesterday as the company said sales volumes were up in the first quarter of the new financial year. The upbeat update means Questor’s advice that the shares were looking oversold is paying out nicely.





The FTSE 250 company, whose customers include Procter & Gamble and Unilever, manufactures packaging for consumable consumer goods such as washing powder and tinned tomatoes on supermarket shelves.


The packaging group said like-for-like corrugated box volumes since May 1 have grown across all DS Smith’s regions, with growth ahead of last year’s rate and its target rate of “GDP +1pc”.

The company added that it bought a Scandinavian foam business for £24m and that, following the triennial pension review, no drastic changes were required to the funding.

The company generates about 65pc of its earnings in euros and more than 70pc of its revenue comes from outside the UK. DS Smith said a change of one euro cent in the pound/euro exchange rate affected pre-tax profit by about £1.2m.

Miles Roberts, chief executive, said: “Notwithstanding continued headwinds in many of our markets, performance has been in line with our plans.”

DS Smith is still generating plenty of cash and the dividend is covered more than twice by free cash flow. Analysts from Investec expect net debt to fall to about £750m by next April, down from about £830m

Market consensus is for DS Smith to increase pre-tax profits to £271m, on revenue of £4.12bn in the year ended April, giving 24.2p in earnings per share. That leaves the shares trading on 11.3 times forecast earnings.

Questor said “DS Smith shares look oversold” at 259.6p on August 7, and so they proved, rising by almost 11pc in little over a month.

We didn’t expect the recovery to be that quick and we think there could be a little longer to run with the prospective dividend yield of 4pc on offer, and that dividend is covered more than twice by earnings. Questor maintains the long-term view on DS Smith: Buy.

Smith (DS): Investec cuts target price from 380p to 350p and stays with its buy recommendation.

H1 trading update and acquisition

RNS


RNS Number : 2867W

Smith (DS) PLC

06 November 2014






6 November 2014

DS Smith Plc - H1 trading update and acquisition

DS Smith Plc, the leading supplier of recycled packaging for consumer goods, today issues a trading update for the half-year to 31 October 2014 and announces the acquisition of Spanish corrugated board producer Andopack.

Trading update

Group performance remains in line with our expectations, with continued good growth across all regions. The market and business trends discussed in our Interim Management Statement of 17 September 2014 have continued.

Like-for-like corrugated box volume growth is ahead of last year and our medium term financial target of GDP +1%. Return on sales and ROACE continue to improve and our focus on working capital and tight capital management has delivered a strong cash flow performance.

Acquisition of Andopack

We are pleased to announce the acquisition of Andopack, a Spanish corrugated board producer. Andopack is a very well-invested and growing business with good access to both Barcelona and Madrid.

The acquisition gives the Group a direct market position in Spain, allowing us to meet the demands from our pan-European customers to have a presence in this important market. Andopack will provide cost and cash saving opportunities and an excellent platform for growth as we leverage our scale, innovation and customer relationships.

The total consideration, including the assumption of debt, is expected to be circa £35m, subject to closing adjustments, representing a post synergy multiple of between 5.0 and 6.0x EBITDA. The transaction is being financed from existing cash resources and is expected to deliver a return on invested capital above our cost of capital in the second year of ownership.

Outlook

Our outlook remains positive as the business continues to grow, despite economic headwinds in many of our markets. The Board expects continued performance in line with the Group's medium term financial targets.

Miles Roberts, Group Chief Executive, said:

"In the first half of this financial year, we have continued to make good progress with our customers, benefitting from our differentiated commercial offering. We have again delivered volume growth ahead of the market, together with improved margins and returns.

The acquisition of Andopack in Spain is an exciting development for DS Smith as we continue to strengthen our pan-European customer offering. Andopack has high quality assets and we look forward to growing it further as we expand in this attractive market."