Europe's largest containerboard maker Smurfit Kappa saw revenues fall by 17 per cent for first nine months of 2009, while trading profits were down 40 per cent.
In an interim trading statement issued this morning, the company recorded revenues of €4.5 billion compared to €5.4 billion a year earlier. However, Smurfit said allowing for the impact of currency, acquisitions and closures, revenue showed an underlying decrease of €748 million, down 14 per cent compared to the same nine months period in 2008.
Ebitda of €555 million was €190 million, or 26 per cent lower than in the comparable period last year. Fee cash flow was down €83 million to €143 million.
The company said it successfully increased its Ebitda margins from a low of 11.9 per cent in the first quarter to 12.7 per cent in the third quarter.
Smurfit reduced its net debt by just over €158 million during the nine-month period under review, the equivalent of approximately 5 per cent year-on-year.
During the third quarter of 2009, revenues were down 14 per cent to €1.5 billion. However, the company said that once allowance was made for the negative impact of currency of €45 million and net disposals and closures of €8 million, revenue shows an underlying decrease of €185 million, the equivalent of approximately 11 per cent.
Trading profits declined 27 per centto €96 during the three-month period ending September 30th.
Third quarter Ebtida was down 17 per cent or €39 million to €192 million. The underlying Ebitda decrease was €34 million, the equivalent of 15 per cent.
Compared to the second quarter of 2009, Ebitda was €8 million higher.
“Demand for the group’s products was generally stable through the third quarter. The improved Ebitda margin of 12.7 per cent again outlines the continuing benefits of our integrated business model, our effective cost take-out actions and the strong contribution from our Latin American business. These positives were somewhat offset, as expected, by higher recovered fibre costs and continued pressure on corrugated pricing in Europe,” said chief executive Gary McGann.
Smurfit Kappa yesterday said one of its wholly-owned subsidiaries plans to issue debt in the form of senior secured notes due 2017. The net proceeds from this will be used to repay a part of the outstanding indebtedness under its senior credit facility, the company added.
