Smurfit Kappa shares climb 2.9%
SMURFIT KAPPA Group rose in Dublin trading yesterday after the box maker said it planned to increase prices in Europe, raising analyst expectations for its earnings outlook.
Smurfit Kappa climbed as much as 2.9 per cent to €6.38, close to a more than five-month high of €6.39 on August 2nd.
The company said in a statement it planned to raise the price for recycled container-board by €100 a tonne from today “amid improving demand growth”.
“Given the comments on improving demand, the outlook statement with the company’s fourth quarter results next week is likely to be more positive than expected,” Barry Dixon, an analyst at Davy, said in a note to clients.
“We remain cautious on the prospects for implementing the current round of price proposals, particularly given the continuing uncertain economic environment.”
The Smurfit price rise follows price increases by rivals including Sweden’s Svenska Cellulosa, according to Davy. The chances of successfully pushing through price increases improved as more companies followed the trend, Mr Dixon added. – (Bloomberg)