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Smurfit Kappa (BBB- pos/Baa3 pos) Results in Line, Returns To Growth

BASIC INDUSTRIES


  • Revenues were in line with expectations at €11.27bn, -12% YoY, as was EBITDA at €2.08bn, also -12% YoY
  • Net debt fell to €2.84bn, but leverage comes in at 1.4x vs 1.3x at FY22 due to the drop in EBITDA
  • FCF improved to €628m vs €545m for FY22
  • The company flagged a return of demand in Q4, following slowing sales earlier in the year due to difficult economic conditions
  • Equity trading ~4.5% higher this morning with investors relieved by the return to volume growth in Q4, as well as a 10% dividend increase
  • Overall these results appear neutral for spreads, with indicative pricing unchanged so far

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