DS Smith's revenues for year to end of April up 10% due to organic growth, 12-month contribution from legacy SCA Packaging business; operating profit increases 23% to £307M, including benefit of €40M of cost synergies

Elyse Blye

LONDON , June 26, 2014 (press release) – Packaging specialist DS Smith said revenues grew by 10% in the year to end-April, due to organic growth and a 12-month contribution from the legacy SCA Packaging business.

Operating profit increased 23 per cent to £307 million (2012/13: £249 million), including the benefit of €40 million of cost synergies, which we have delivered as expected. A further €40 million benefit is expected from synergies in 2014/15, as previously announced, completing the overall three year cost synergy programme.

Earnings per share increased 25 per cent to 21.4 pence (2012/13: 17.1 pence), building on the substantial growth of the prior two years of 37 per cent and of 29 per cent.

Dividend per share is 10.0p, up 25% from 8.0p. Highlights

· Strong growth in profits, returns and dividends

· Organic corrugated packaging volume growth of +2.2% driving market outperformance, led by good growth in areas of focus

· Return on sales progression of 80bps to 7.6% despite input cost pressures

· Synergy benefits from SCA Packaging acquisition fully on track

· Continued delivery of our medium-term targets

· Investment to support further growth and efficiency

Miles Roberts, Group CEO, said:

"This is a strong set of results achieved despite economic conditions across Europe remaining challenging. We have achieved our synergy targets for the year and delivered good growth in profits, returns and dividends.

At the heart of our performance is an unrelenting focus on the customer. Our strengthened customer proposition and an ability to deliver across the whole customer supply cycle has led to increased market share across our regions.

The current year has started well and is in line with our expectations. While we are planning for a difficult consumer economic environment to remain, our focus on delivery, capital discipline and continued investment in the business provides us with confidence in the sustainability of our business model. Looking ahead we remain excited about further growth opportunities for the Group."

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