DS Smith reports strong Q1 as it plans end for final-salary pensions

In an interim management statement this morning before its AGM today, the group said volumes had grown in the first quarter that and that it was pushing prices up to recover high paper costs.

It also reported progress in the integration of French packaging group Otor, whose EUR247m acquisition completed last week, and in chief executive Miles Roberts’ strategic review of the business.

However, it also reported that it had begun consultations with UK employees in its defined benefit pension scheme with a view to closing the scheme to future accrual. “This will help the Group better manage this exposure in the future,” the firm said.

‘Positive demand’
In its packaging business, the corrugated group said it had seen a good first quarter thanks to “positive demand trends” in Europe and the UK.

“The anticipated phased recovery of paper price increases has led to profits in line with our expectations,” the statement said.

Chief executive Miles Roberts’ business review, which aims to focus the business on high-margin work, is progressing, the statement said. More details will be announced when half-year results are revealed on 9 December.

The business completed its acquisition of French retail-ready specialist Otor last week (1 September) and, in today’s statement, reported that integration teams have been put in place to manage the merging of Otor and DS Smith’s existing French business.

It added that they were on track in plans to make EUR9.3m ((£7.7m) in annual cost savings by the second full financial year of ownership of Otor.

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