Smurfit Kappa share price up 3% on market opening
Smurfit Kappa increased its final dividend on Wednesday as the company revealed it made a pre-tax profit during 2020.
The packaging firm reported €748m pre-tax profits, up by 10% from €677m in 2019.
Smurfit Kappa reported a 6% year-on-year fall in revenue from €9.05bn to €8.5bn. The FTSE 100 company put this down to adverse currency movements and a fall in box prices.
Smurfit Kappa also announced it would be hiking up the value of its final dividend up by 8% to 87.4 cents per share.
Smurfit Kappa capped its financial results announcement by confirming an EBITDA of €1.15bn with an EBITDA margin of 17%.
The company’s share price jumped up by 3% to 3,648p as the market opened on Wednesday morning following the release of its final results.
Since March 2020 the Smurfit Kappa’s share price has grown steadily from a dip below 2,000p per share to well above 3,500p.
Tom Smurfit, chief executive of Smurfit Kappa, projected confidence in the company’s ability to perform in 2021 despite the ongoing pandemic, and said its dividend payment reflected this.
“While there remains some uncertainty on the impact and duration of COVID-19, the year has started well with the continuation of the demand trends seen during the last quarter.
Reflecting the Board’s confidence in this performance and prospects for the business looking forward, the Board is proposing an increase in the final dividend of 8% to 87.4 cent per share,” said Smirfitt.
Smurfit Kappa has benefited from market trends which have been exacerbated by lockdowns according to the company’s CEO.
“Driven by strong secular trends such as e-commerce and sustainability, the outlook for our industry is increasingly positive.
SKG has positioned itself as the leading company within the industry, with great people, providing our customers with unique packaging solutions centred around innovation, efficiency and sustainability,” said Smurfit.
Smurfit Kappa is well capitalised to pursue growth opportunities after raising €660m via a placing in November.