DS Smith calls profit trend positive

United Kingdom-based recycled-content paperboard and packaging producer DS Smith PLC has issued a trading statement citing what it calls an ongoing trend in profitability in line with management expectations.

Looking at its 2023 fiscal year third quarter, which ran from Nov. 1, 2022, through Feb. 28 of this year, the maker of paperboard grades and downstream packaging cites “continued strong trading” in that timeframe building on “the positive trends in profitability experienced” in its May through October 2022 fiscal year first half.

“We have continued to perform well in the second half of the [fiscal] year despite the volatile macro-economic conditions,” says Miles Roberts, group chief executive of DS Smith.

He continues, “As expected, profitability and returns have grown strongly, and cash generation remains good. We continue to stay very close to our customers and their evolving needs, which, together with a relentless cost focus and robust supply chain, positions us well for the remainder of the year and into our next financial year.”

In additional trading statement comments, DS Smith says it has “continued to take market share, driven by our strategic focus on resilient sectors such as food and drinks, although like-for-like corrugated box volumes during [the second fiscal half] have been lower than the comparative period with market weakness and evidence of de-stocking over Christmas and New Year.”

The firm says while its volume are lower, its profitability is not poised to suffer in the same way. “Our robust and flexible supply chain, together with ongoing cost management initiatives and resilient pricing, have more than offset the lower volumes, driving further margin progression, strong profit growth and improvement in our return on capital,” states DS Smith.