5 December 2019 by Joshua Doherty

Profits up at DS Smith but Northern Europe falls

Paper company DS Smith has posted a 27% fall in operating profit in Northern Europe in its half year results, despite recording increased profits for the group amid a “challenging and uncertain” environment.

The results posted this morning, 5 December, cover the first six months of the financial year to 31 October.

Northern Europe

The results show that revenues in Northern Europe – which comprises the UK, Germany, Switzerland, Norway, Sweden, Finland, Denmark and Benelux – fell by 7% to £1.31 billion while operating profit fell by 27% to £104 million.

DS Smith has posted its half year 2019/20 financial results

This was put down to “a combination of a modest decline in corrugated box pricing, combined with a larger impact from a reduced sales price for externally sold paper and lower volumes sold externally”.

The results also showed that in Northern Europe, organic corrugated box volume growth was “mixed, with continued good growth in the UK and the Nordic region” driven by its “strong Fast-Moving Consumers Goods focus”.

This was “somewhat offset by difficult conditions” for industrial customers in Germany and the surrounding Benelux region, particularly in the automotive sector, DS Smith said.


However, the wider group, which also covers both Southern and Eastern Europe and the US, saw profits increase by 30% when compared with the same period last year to £213 million and a revenue jump by 3% to £3.18 billion in the same period.

In the half year to 31 October 2019, DS Smith said it has “continued to grow well”, despite a fall in prices for exported paper.

“Group revenue for the half year increased, principally due to acquisitions, partially offset by lower volumes and sales prices within the paper and recycling businesses,” the results read.

They added: “External volumes in paper reduced as a result of increased internal sales and recycling volumes continue to be impacted by lower export demand from Asian markets. These decreases were partially offset by modest growth in corrugated box volumes and robust average sales prices.”


Miles Roberts, group chief executive at DS Smith

Miles Roberts, group chief executive at DS Smith, said: “Our leadership in e-commerce and sustainable packaging solutions has enabled us to perform well despite a difficult macro environment and volatility in paper pricing.”

Mr Roberts added: “We continue to capitalise on the strong long-term growth drivers of fibre-based packaging, with our industry-leading innovation driving differentiation in the market. Assuming current macro-economic conditions prevail, we anticipate an acceleration of volume growth in the second half of the year”.


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