DS Smith sees FY in line as prices offset lower volumes

Paper and packaging group held full-year guidance as higher prices offset forecast lower volumes.

It now expects adjusted core earnings to be in a range of £850 - £860m for the year to April 30.

"Excellent customer relationships, and our high levels of service, product innovation and sustainability focus have driven resilient packaging prices during the period," the company said in a trading update.

"Combined with good cost management, this has more than offset the weaker than expected volumes to deliver growth in profitability and delivery in line with our medium-term financial targets."

The company said continued strong free cash flow performance for the full year would lead to a reduction in net debt / core earnings leverage ratio to approximately 1.3 times as against 1.6 times a year earlier.

Reporting by Frank Prenesti for Sharecast.com