Thursday, 4 December 2014
DS Smith - Interim Results
The company has developed to become a European leading provider of consumer packaging with emphasis on state-of-the art packaging design. It is the largest paper recycler in Europe, collecting around 5.4m tonnes annually, a market leading recycling and waste management company
DS Smith rejoined my portfolio following the final results last June - here’s a link to a post.
The company has today reported a strong set of interim results for the half year to end October (link via Investegate) with adjusted profits up 17% (constant currency) at £176m and earnings per share up 24% at 12.9p.
Chief Executive Miles Roberts said: "We are pleased with performance in the first half of this financial year. We have continued to make good progress with our customers, benefitting from our differentiated commercial offering, and this has translated into strong financial performance, with a particularly good progression on margins and returns as well as excellent cash flow generation. We continue to actively manage our business portfolio and are excited by the opportunities for the Group.
Our outlook remains positive as the business continues to grow, despite ongoing economic headwinds in many of our markets. The Board expects continued performance in line with the Group's medium term financial targets."
Free cash flow is strong at £151m (£110m 2013). Net debt reduced to £694m (from £827m - April 2014).
The group has increased the interim dividend by 16% to 3.7p (3.2p 2013) - I‘m not sure why investors have to wait 6 months to receive it! The target dividend cover is 2.0x - 2.5x earnings
The results were well received by the market and the share price was up over 5% closing at 304p. More on this following the final results next June.