Smurfit Kappa Foresees Tremendous Rise in Packaging Demand in 2018

SEATTLE (Scrap Monster):  The recently published Annual Report-2017 by Smurfit Kappa predicts continuation of good demand for corrugated packaging in 2018. Building on the momentum of recent years, the company had reported record high full-year EBITDA of €1,240 million in 2017. Smurfit Kappa expects the momentum to continue in 2018, thereby resulting in tremendous improvement of its business. The year will return strong returns for its shareholders, the Annual Report said.

Even in the midst of increased raw material input costs and adverse currency impacts, the EBITDA by European region climbed higher by 3% to € 955 million. However, in the Americas, EBITDA was down by almost 8% to € 311 million in 2017. The results were impacted by several factors including increased containerboard export prices from the U.S. to Latin America, high recovered fibre costs and adverse weather conditions to name a few. In fact, recovered fibre costs have surged by almost 26% during the previous year.

The Smurfit Kappa Group made three key acquisitions during 2017, mainly in Russia and Greece, for a total consideration of approximately Euro 55 million. It had acquired an integrated corrugated plant in Moscow. The company also entered the Greek market through acquisition of a high-end display and corrugated business. It had also acquired the assets of a Portuguese producer of bags.

The company expressed commitment to develop and further strengthen its global reach through disciplined acquisitions and capital investment programmes. Also, the company will further improve its packaging offering to multinational customers by employing innovative technologies in manufacturing process. Smurfit Kappa foresees increased demand from European region in 2018. Also American business is likely to witness further input cost recovery and signs of improvement during the year.