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DS Smith PLC on Tuesday reported a jump in profit and good revenue growth in financial 2022, due to high demand, specifically in North America.
The London-based packaging firm posted a pretax profit of £378 million in the financial year that ended April 30, reflecting an increase of 64% from £231 million the year before.
This was on revenue growth of 21% to £7.24 billion from £5.98 billion.
The FTSE 100 company credited this to strong demand throughout the year which led to volume growth of 5.4%.
‘Volumes rose in all European regions and were noticeably higher in North America as a result of the continued growth at the greenfield packaging site at Lebanon, Indiana,’ the company said.
DS Smith explained that this coupled with higher selling prices for packaging, paper, and recyclate to mitigate the price increases in raw materials enabled its growth in financial 2022.
DS Smith declared a total dividend of 15.0 pence, up 24% from 12.1p paid out in financial 2021.
The company still cautioned of macroeconomic uncertainty, due to the conflict in Ukraine.
However, DS Smith said it has seen good early momentum at the start of its current financial year, despite the more-challenging backdrop.
For financial 2023, DS Smith expects corrugated box volume growth in the range of 2% to 4%. It plans to increase capital expenditure to £500 million to invest in ‘customer-led growth opportunities’.
Chief Executive Officer Miles Roberts said: ‘It has been another year of volatile trading conditions where we have worked through the tail-end of the pandemic and, more recently, the tragic events of the Russian invasion of Ukraine.
‘The new financial year has started well, building on the momentum from the previous year. Whilst there remains considerable uncertainty about the overall economic environment, our expectations remain unchanged. Strong customer demand reinforces our confidence to invest in the business, with capital expenditure expected to further increase in the current year.’
DS Smith shares were trading 1.4% higher at 286.10 pence each in London on Tuesday morning.
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