Smurfit earnings rise in 2010

Smurfit Kappa Group grew its earnings by 22 per cent in 2010, and said it expects further growth in 2011.

Earnings before interest, tax, depreciation and amortisation rose to €904 million last year, despite costs pressures in the fourth quarter.

Chief executive Gary McGann said focus on driving operating efficiency helped offset the impact of rising input costs in the last quarter of the year, along with better than expected demand and pricing recovery in Europe and in Latin America.

"Current business conditions support continued price recovery with input costs rising and demand remaining strong. Industry inventory levels remain at a satisfactory level and the supply outlook is favourable," he said.

Full-year revenue trose 10 per cent to €6.7 billion, while the company also booked exceptional charges of €81 million during the period, almost half of which was related to the Mondi asset swap completed in May. A further €23 million was accounted for by the disposal of SKG's Polish paper sack plant and of Rol Pin.

Operating profit after exceptional items was €409 million, a rise of 53 per cent compared to the previous year. Profit before tax was €103 million, compared to a loss before tax of €52 million last year.

Looking ahead to 2011, the company predicted ongoing strength in its performance.

"The group currently expects its free cash flow generation to be materially stronger in 2011, which should translate into significant debt paydown, and enhance the available range of strategic and financial options," Mr McGann said.