DS Smith sees trading in line with expectations

Packaging company DS Smith said trading was in line with expectations as higher box volumes were offset by a rise in input costs.

Like-for-like corrugated box volume growth had accelerated compared to the second quarter, with e-commerce strength over Christmas continuing into 2021, the company said in a trading update on Wednesday.

“Trading continues to progress well, with the trends and momentum described in our first-half results on 10 December continuing into the second half,” the company said.

DS Smith, which last week the centre of speculation that it was the target of rival paper and packaging firm Mondi, said rising input costs, together with high demand, continued to drive higher paper prices.

“We have started to recover these additional costs through higher packaging prices and our expectation is, with the customary lag, they will be fully recovered and underpin continued momentum into the 2022 financial year,” the company said.

Chief executive Mike Roberts said that while the economic environment remained uncertain due to Covid-19, the company was “experiencing good momentum across the business in both Europe and North America”.

“We are confident in delivering results in line with our expectations for the year and showing further good progress and momentum as we move into the next financial year.”