DS Smith Plc Delivered good top line growth and substantially increased profit levels

DS Smith Plc (LON:SMDS), today announced 2018/19 half year results.

6 months to 31 October 2018




 (constant currency)

Continuing operations(10), excluding Plastics





Adjusted operating profit




Profit before tax




Adjusted EPS(1) (9)




Statutory EPS(9)




Interim dividend per share(9)




Return on sales(4)








Group, including Plastics

Revenue (Group)




Adjusted operating profit(1)(Group)





· Successful and differentiated business model

o Return on sales margin +120 bps

o Good organic volume growth(2) of 3.2%

o Excellent cost recovery reflects business mix and strength of business model

o Growth from FMCG and e-commerce leadership

o US acquisition fully integrated and delivering well ahead of acquisition case

· Strong balance sheet

o Increase in cash flow from operating activities from continuing operations

o Net debt / EBITDA(6) (excluding rights issue proceeds) fallen to 2.1x

o Refinancing complete – new long-term facility

o Plastics strategic review making good progress

· Europac acquisition completion expected around calendar year end

o Reported performance to Q3 2018 in line with expectations

o Integration planning well advanced

· Compelling commercial differentiation and structural drivers for growth

o E-commerce, sustainable packaging, dynamic retail changes

o DS Smith innovation-led solutions for multinational customers

· Good momentum into H2

Miles Roberts, DS Smith Group Chief Executive commented:

“We are very pleased with the progress we have made over the last six months. We have strong momentum in the market, delivering good top line growth and substantially increased profit levels. We continue to win market share through our strong FMCG presence and our leadership in both e-commerce and sustainable packaging. DS Smith is extremely well positioned to capitalise on these ongoing growth trends and we are confident about the future prospects for the business.”

Sustainable delivery against medium term targets

Medium term targets

Continuing operations

Delivery in H1 2017/18(8)

Organic volume growth(2) ≥GDP(3)+1%


Return on sales(4) 8% – 10%

+120bps to 9.9%

ROACE(5) 12% – 15%

 unchanged at 13.9%

Net debt / EBITDA(6) ≤2.0x


Cash conversion(7)  ≥100%