Smith (DS) PLC (SMDS) - Interim Management Statement
RNS Number : 4079L
Smith (DS) PLC
04 September 2012
4 September 2012
DS SMITH PLC INTERIM MANAGEMENT STATEMENT
DS Smith Plc ("DS Smith" or "the Group"), the international supplier of
recycled packaging for consumer goods, today publishes its Interim Management
Statement in respect of the period since 30 April 2012. DS Smith will hold its
Annual General Meeting at 2pm today.
On 30 June 2012 DS Smith completed its acquisition of SCA Packaging, as
planned, for consideration of €1.58 billion (£1.28 billion), funded from bank
facilities and cash raised earlier in the year via an equity issue.
Accordingly, net debt increased commensurately and SCA Packaging is
consolidated in the accounts of DS Smith from this date. Save for this
acquisition, there has been no material change in the financial position of
the Group since the publication of our full year results to 30 April 2012.
Integration of SCA Packaging
On completion of the acquisition, we immediately put in place a combined
management structure, and communicated our plans to both customers and
employees. We have been pleased with the reaction from our key customers and
the enthusiasm of all our employees for the creation of this leading pan
European recycled packaging supplier. The integration work is proceeding
slightly ahead of the planned schedule and we are pleased with progress to
date. We look forward to updating investors with more details at our scheduled
presentation on 11 October 2012.
In the period since 30 April 2012, DS Smith has transformed its position in
the European market for recycled packaging, having completed its acquisition
of SCA Packaging on 30 June 2012 as planned.
Trading for the Group in the period has continued in line with our
expectations, with good corrugated box volumes in the legacy DS Smith
business, slightly ahead of our GDP+1% target, with particularly encouraging
volume growth continuing in Continental Europe. This has led to our operating
profit margin for the Group continuing to improve despite the continued
difficult market for our moderately sized paper business.
In the period we have seen good performance from the legacy DS Smith business
despite the ongoing tough trading environment. Trading in the SCA Packaging
business has been fully in line with expectations, reflecting the continuing
difficult market conditions. As previously announced, we expect to deliver a
return on capital from the acquisition above our weighted average cost of
capital, in the financial year. This is based on the cost and capital
synergies previously announced. We also continue to expect net debt / EBITDA
to fall below 2.0x by the end of the first full financial year of ownership.
The company is trading in line with current market expectations for
substantial year-on-year EPS growth and the Board views the remainder of the
year with confidence.
Miles Roberts, Group Chief Executive, said
"The Group has made a good start to the year by focusing on what our customers
value - service, quality and innovation. The SCA Packaging business is very
complementary to DS Smith's strengths and creates a significantly enlarged
geographic footprint. Together, we are now better positioned to meet the needs
of our pan-European customers and to deliver substantial value for our
customers, shareholders and employees."
DS Smith Plc +44 (0)1628 583 400
Miles Roberts Group Chief Executive
Steve Dryden Group Finance Director
Simon Craven Group Communications Director
Rachel Stevens Head of Investor Relations
Tulchan +44 (0)20 7353 4200
A conference call for analysts and investors, hosted by Miles Roberts and
Steve Dryden, will take place today, 4 September 2012 at 08.00 BST. The
dial-in number is:
UK / International +44 (0)20 3003 2666
Password DS Smith
A play-back facility of this call will be available until 11 September 2012.
The dial-in number is: +44 (0)20 8196 1998, access pin 3388102. A recording
and transcript of the call will also be available through the Investor
Relations section of our website: www.dssmith.uk.com
100-day presentation on SCA Packaging 11 October 2012
Pre-close statement 6 November 2012
Results for the half year to 31 October 2012 6 December 2012
This information is provided by RNS
The company news service from the London Stock Exchange
IMSBKNDQKBKBACK -0- Sep/04/2012 06:00 GMT
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