IRELAND – Corrugated packaging company, Smurfit Kappa, has reported that its profit fell by 19.6% to €759 million (US$817m) in financial year 2023 (FY23), compared with €945 million (US$1.02bn) in FY22.

Throughout the year concluding on 31 December 2023, the company’s operating profit before exceptional items dwindled to €1.40 billion (US$1.51bn), reflecting a 16% decrease from the preceding year’s €1.66 billion (US$1.79bn).

Smurfit’s revenue for the full year amounted to €11.27 billion (US$12.14bn), marking a 12% decline on a reported basis and an 11% reduction on an underlying basis compared to the prior year.

In Europe, the company witnessed a 14% decline in revenue, primarily attributable to decreased paper and box pricing year-on-year (YoY) along with reduced box volumes.

Similarly, its Americas segment observed a 5% revenue dip from 2022, with a corresponding 6% decrease on an underlying basis.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) amounted to €2.08 billion (US$2.24bn) in FY23, indicating a 12% decrease from €2.35 billion (US$2.53bn) in FY22.

Notably, the company’s net debt experienced a 5% reduction to €2.84 billion (US$3.06bn) in FY23 from €2.99 billion (US$3.22bn) in FY22.

CEO Tony Smurfit remarked, “Our results, the second best in our 90-year history, underscore the excellence of our workforce and their unwavering commitment to delivering the most innovative and sustainable packaging solutions for our clientele.

“However, one notable trend we’ve observed is the escalating demand for sustainable packaging solutions. While full-year volumes witnessed a 3.5% decline, we witnessed progressive demand improvement throughout the year, culminating in growth during the fourth quarter.”

O-I Glass reports substantial decline in EBIT in FY23

Meanwhile, O-I Glass, a US-based glass container manufacturer, reported earnings before income taxes (EBIT) of US$67 million in financial year 2023 (FY23), a substantial decrease from US$805 million in FY22.

This notable decline was primarily attributable to non-recurring items deemed non-indicative of ongoing operations by the company’s management.

Particularly impactful were a US$445 million charge for the impairment of goodwill in O-I’s North America reporting unit in 2023, and a US$334 million one-time gain from sales-leaseback transactions in 2022, which were not repeated.

Loss attributable to O-I Glass stood at US$0.67 per share (diluted) in FY23, in stark contrast to earnings of US$3.67 per share (diluted) in 2022.

Despite the downturn in EBIT and earnings per share, net sales increased to US$7.1 billion in 2023, up approximately 4% from US$6.9 billion in the previous year.

In the fourth quarter (Q4) of FY23, O-I Glass reported a loss before income taxes of US$439 million, compared to earnings before income tax of US$29 million in the corresponding quarter of FY22.

The fourth quarter also saw a loss attributable to the company of US$3.05 per share, against earnings of US$0.08 per share (diluted) in Q4 FY22.

Net sales in Q4 amounted to US$1.6 billion, down from US$1.7 billion in the same period of the preceding year. As of 31 December 2023, O-I’s total debt stood at US$4.9 billion, an increase from US$4.7 billion at the end of the previous year.

Its net debt also expanded to US$4.0 billion, from US$3.9 billion in 2022.

CEO Andres Lopez expressed satisfaction, stating, “I’m pleased to report strong 2023 performance as we successfully navigated softer macro conditions that developed over the course of the year, including significant inventory destocking across the value chain.

“O-I continued to execute well through the fourth quarter, and business performance moderately exceeded our expectations.

“As we concluded the year, strong net price and the benefit from our margin expansion initiatives helped mitigate the impact of softer demand and elevated production curtailment to balance supply with lower shipments.”

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