DS Smith today (18 June) reported strong organic box volume growth of +5.2% with growth in all regions, in its 12 months annual figures to 30 April 2018.
An upbeat chief executive, Miles Ropers declared that the company has been focusing on innovation and had also sought to recover “substantial input cost pressure over the period” through the selling price of its products.
And, in the company’s report it also highlighted how there had been a “significant increase in paper prices that we’ve had to recover.”
Prices for used cardboard, a key feedstock for DS Smith to make new corrugated material, were at a particularly high level from May to December 2018 although the prices for the first four months of this year were substantially reduced in the wake of export restrictions to China. DS Smith has also been using more mixed paper in its feedstock. Nevertheless, it appears the company has held on to, or increased, its prices for new material despite recent price falls for used cardboard.
DS Smith has highlighted its success in recovering the higher cost of paper for making new cardboard material (pictured:Kemsley mill, Kent)
Volume growth
DS Smith reported that “adjusted operating profit increased by 16 per cent on a constant currency basis (20 per cent on a reported basis) to £530 million (2016/17: £443 million). This was driven by the significant contribution from volume growth, contributing 13 per cent growth (£59 million) compared to the prior year, and from the contribution of businesses acquired, in particular our North America assets.”
Sustainability
In its financial statement today, DS Smith emphasised its strategy “to lead the way in sustainability. Corrugated packaging is a key part of the sustainable economy, providing essential protection to products as they are transported and, at the end of use, it is fully recyclable. Corrugated packaging is also substantially constructed from recycled material, as are many of our plastic packaging products.”
The statement continued: “Our recycling business works with customers across Europe to improve their recycling operations and overall environmental performance. In calendar 2017, compared to calendar 2016, on a restated basis to reflect acquisitions, our CO2 equivalent emissions, relative to production, have increased by 5 per cent, reflecting an increase in energy usage relating to increased volume growth, and the impact of light-weighting our paper and packaging.”
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Source: letsrecycle.com Packaging
