Sonoco-Alcore announced that due to continued inflationary pressure on the business, it will raise prices by 10 percent on all tube and core grades sold in the Company’s EMEA regions. The increase will be effective for all shipments made on or after the 13th December 2021. “We continue to experience further cost increases in all sectors of our operations and supply chain. Even with a strong focus on implementing productivity initiatives, they are not enough to offset inflationary pressures from energy, packaging, transportation, adhesives and raw materials. As such, we are forced to pass on cost increases to the market,” said Karsten Kemmerling, Division VP - Sales & Marketing EMEA.
Fourth Quarter and Full Year Key Points
* Group revenue growth of 7% for the fourth quarter and 5% for the full year
* Fourth quarter EBITDA up 10% year-on-year with reported full year EBITDA of €1,240 million
* Full year ROCE at 15.0% in line with Group target
* Solid free cash flow generation of €307 million for the year
* Net debt to EBITDA of 2.3x
* Final dividend increase of 12% to 64.5 cent per share
Performance Review and Outlook
Tony Smurfit, Group CEO, commented: “I am pleased to report EBITDA for the fourth quarter of €351 million, an increase of 10% year-on-year. Our EBITDA margin for the quarter at 15.9% also improved both year-on-year and on a sequential basis. Our full-year EBITDA was €1,240 million, a record for the Group, with an EBITDA margin of 14.5%.
“Our full year result was delivered against a backdrop of an increase in excess of €120 million in recovered fibre costs, generally higher raw material costs and adverse currency movements.This improved result for the year, and more importantly for the fourth quarter, reflects the benefits of our continued focus on offering our customers cost effective and innovative solutions, our capital expenditure program, input cost recovery through paper and box price increases and generally strong markets. We also continue to benefit from the Group’s geographic reach and integrated model, which support our customers by ensuring security of supply in very tight markets.
“Our European business showed very strong progression for the quarter, growing its margin to 16.5%. This strong performance came as a result of high levels of demand across most product lines and input cost recovery. Security of supply for our customers is key for us and we have been investing accordingly.
“In the Americas, reported EBITDA of €311 million and a 14.4% margin came in below our expectations. The result was impacted by a number of factors including increased recovered fibre costs, adverse weather events in the latter half of the year, the continued rise in containerboard prices where we are a significant net buyer of approximately 300,000 tonnes and adverse currency moves. During the fourth quarter, some countries experienced an unexpected slowdown which now shows signs of reversing. The region has been progressing its input cost recovery through 2017 and this will continue into 2018.
“Our two most recent acquisitions in Russia and Greece are integrating well. The Group remains ready to further expand our geographic footprint through acquisition where we can deliver long-term value creation.
“Our net debt to EBITDA ratio at 2.26x is at the lower end of our stated range.
“As we start 2018, the benefits of paper-based packaging are being increasingly recognised as the most sustainable, biodegradable solution for both our customers and their end customers. SKG continues to invest and develop these innovative and sustainable packaging applications which will further broaden our product portfolio. These investments will continue to ensure security of supply for our customers and help them address growing trends such as e-commerce and increasing supply chain complexity.
“SKG is a leader in the area of corporate social responsibility, which has been recognised by a number of third party organisations, and we are committed to supporting the communities in which we operate.
more at: http://www.smurfitkappa.com/vHome/com/Newsroom/PressReleases/Pages/Fourth-Quarter-and-Full-Year-Results-2017.aspx