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Recycler DS Smith anticipates packaging price rises

DS Smith

DS Smith has predicted packaging price rises as it reported a sharp drop in pre-tax profit.

The London-based global producer and recycler announced revenue of £6.8bn for the 12 months to 30 April this year.

This represented a drop of 17 per cent while pre-tax profit fell 24 per cent to £503m.

Group chief executive Miles Roberts nonetheless hailed a “robust performance” in the face of a “challenging environment”.

“I am also very proud of the continued excellent progress in helping [meet] our customers’ sustainability challenges and to have achieved our target of 1bn units of plastic replaced with fibre-based alternatives 16 months ahead of schedule,” he added.

Roberts said “positive trends in packaging volumes” had continued into the current financial year, while the firm was “focused on pricing, operational efficiency and tight cost control”.

Increasing demand was pushing up paper and other input costs, including OCC, he added.

“We anticipate this will be reflected in packaging price rises, with the benefits expected to be weighted to the second half of our current financial year and provide further momentum into FY26.”

Roberts said that a previously-mooted merger with International Paper was “an attractive opportunity to create a truly international sustainable packaging solutions leader that is well positioned in attractive and growing markets across Europe and North America”.

He added: “We are working collaboratively with International Paper to satisfy the offer conditions and bring about the successful completion of the transaction.”