DS Smith Full-Year Report 2023

We are pleased to have delivered a robust performance, despite the challenging environment, driven by our focus on customers, quality, service, and innovation together with the benefit from our self-help productivity initiatives. I am also very proud of the continued excellent progress in helping our customers’ sustainability challenges and have achieved our target of 1 billion units of plastic replaced with fiber-based alternatives 16 months ahead of schedule.

Miles Roberts, Group Chief Executive

Highlights

• Robust adjusted operating profit of £701m (FY2022/23: £861m), in line with management expectations, against a weak consumer demand environment and high inflation.
• Decline in like for like box volumes of 2%; improving momentum across the year with like-for-like growth of 2% in Q4 FY2023/24 vs Q4 FY2022/23.
• Strong customer relationships, innovation, and high service levels, together with strong cost management, have partially offset downward pricing pressure.
• Lower free cashflow, reflecting our current capital expenditure programme and a working capital outflow, predominantly driven by commodity prices, has resulted in 2.1x net debt/EBITDA (FY2022/23: 1.3x). Underlying working capital metrics remain consistent with prior years.
• Ongoing capital and operational expenditure programmes to support our customers and improve productivity and environmental efficiency remain on track.
• Recommended all-share offer from International Paper to combine the businesses and create a truly international sustainable packaging solutions leader.