Smurfit Westrock reported a net loss in its first quarter as a merged group, as it booked $500 million (€461 million) of expenses and accounting adjustments relating to the transformational deal.
The cardboard box-making giant turned in a net loss of $150 million for the period, it said on Wednesday. Smurfit reported results for the three months to the end of September, the third quarter of its financial year.
Group chief executive Tony Smurfit said that the merged entity’s $1.27 billion earnings before interest, tax, depreciation and amortisation (Ebitda) and earnings margin of 16.5 per cent provide a “a strong foundation to build upon” as he forecast a $4.7 billion out-turn for the full year.
Ireland’s first multinational group effectively doubled in size on July 5th as the takeover of WestRock created the world’s largest paper packaging group with more than $30 billion of annual revenues.
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Shares in the group have jumped 28 per cent over the past year in London – where it retains a secondary listing after moving its main quotation to New York during the summer – as the paper packaging industry recovers from a downturn and on expectations that Mr Smurfit and his team will be able to improve the profitability of the legacy WestRock business. The US company has had much less investment than the Smurfit side in recent times.
“Our established track record of delivering value to our customers through service, quality and innovation is already beginning to yield results,” Mr Smurfit said on Wednesday. “Equally, we believe our focus on plant level autonomy, operational improvement and profitability will deliver in time, benefits at least equal to the stated synergy target of $400 million.”
He added: “Our third quarter performance, combined with our deeper knowledge of the combination and continuing asset optimisation, clearly points to the opportunities ahead for Smurfit Westrock.”
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