Packaging firm Smurfit Kappa has reported a 1% decline in revenue in the first quarter of its financial year, to €2.99 billion, however EBITDA was 13% higher for the period.
The group said that its performance was driven by the 'continuing benefits of [its] integrated model', as well as effective capital spend, a continued focus on customer-led innovation, and its customer footprint.
The group reported EBITDA of €579 million for the period, with an EBITDA margin of 19.3%.
First-Quarter Demand
“As anticipated, first quarter demand was broadly in line with the fourth quarter of 2022," commented chief executive Tony Smurfit. "We expect the demand environment to improve as the year progresses and SKG is well placed across our geographies to take advantage of this."
Smurfit added that the business has been able to "continue to deliver" in a market where volumes are lower than in the previous year.
“As stated at our full year results, Smurfit Kappa has never been better positioned to continue to develop and take advantage of opportunities as they present themselves either through organic investments or acquisitions," he added.
The period also saw Smurfit Kappa finalise its exit from the Russian market.
Read More: Smurfit Kappa On Track To Achieve Net-Zero Emissions By 2050
Analyst Viewpoint
Commenting on its performance, analyst Justin Jordan of Davy said, "While Smurfit Kappa Group (SKG) Q1 2023 box volumes fell 7%, with resilient box prices and easing costs (OCC, energy), Q1 EBITDA rose 13% to €579m.
"With tentative signs of easing destocking in Q2 2023, we maintain our SKG 2023E forecast of €2.07bn EBITDA."
© 2023 European Supermarket Magazine – your source for the latest packaging news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.
