Irish packaging giant Smurfit Kappa saw profit before income tax drop 18 per cent last year, as the firm prepares to merge into one of the largest packaging companies in the world.
In the FTSE 100 firm’s full year results for 2023, it revealed that revenue had dropped 12 per cent, from €12.8bn in 2022 to €11.3bn.
The second half of the year saw even worse performance, with revenue dropping 15 per cent compared to the second half of 2022.
EBITDA for the firm also fell 12 per cent, to €2.1bn, while earnings per share sank 20 per cent to €2.94.
In September, the firm announced it would be merging with WestRock to form Smurfit WestRock, allowing the firm to break into the US market.
Tony Smurfit, group CEO of Smurfit Kappa, said 2023’s results were an “excellent outcome”, noting that they were the second best in the firm’s 90-year history.
Smurfit said that the firm’s capital allocation programme had been “a significant source of our success”, with it investing over €1bn throughout 2023.
“The demand environment for the industry in 2023 was difficult primarily due to destocking and a lack of economic activity in certain sectors, particularly durable goods,” added the CEO.
“However, one trend in which we have seen strong acceleration, is an increasing demand for sustainable packaging solutions. While full year volumes for the group were down 3.5 per cent, we saw a progressive improvement in demand during the year, with a return to growth in the fourth quarter.”