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British multinational packaging business DS Smith has reported its revenue rose 9% in the second half of the financial year after progressive improvement in volumes despite a challenging environment.
The firm's reported revenue rose to £2.9bn while its adjusted operating profit rose by 34% to £230m in the six months to 31 October 2020. Profit before tax was up 54% to £97m, while its free cashflow increased 16% to £207m. However, revenue and profitability were adversely impacted by effects of Covid-19 particularly in the first quarter.
But the firm said it is in a robust financial position and has long-term liquidity, and it has also resumed its dividend. The company noted that Covid-19 has accelerated structural mega-trends in commerce and sustainability, and-commerce sales up around 30% in the period.
Group chief executive Miles Roberts said keeping all its plants operational and responding to our customers' needs throughout the period has enabled the group to perform well in an unprecedented environment.
"We are as excited as ever about the structural growth drivers for corrugated packaging with a number of trends accelerated by the Covid-19 pandemic. We are well positioned to capitalise and are announcing today the construction of two new state of the art packaging plants in the fast growth regions of Italy and Poland to supply the burgeoning FMCG/ e-commerce sector.
"While the economic and political environment remains uncertain due to Covid-19 and Brexit, we see continued momentum for our business, underpinning confidence in continued performance in line with our expectations for the year."
At 9:25am: (LON:SMDS) Smith Ds PLC share price was 0p at 326.7p