DS Smith (SMDS) broadened its range of capabilities in the first half, while an increase in corrugated box and plastic volumes countered pricing pressures and an unfavourable business mix. Revenues, up 7 per cent at constant currencies, received a significant boost from acquired businesses as the recycled packaging group continued to take advantage of a fragmented marketplace. Despite the initial dilutive impact of recent acquisitions, DS Smith managed to exceed the target rate for return on average capital employed, showing good working capital management. The packaging producer also achieved a cash conversion rate of 129 per cent.
Management has identified point-of-sale packaging as a potential growth area, as a growing proportion of consumer decisions are now made in-store, hence the modern spread of promotional packaging found near retail checkout counters. Two specialists in this area, London-based Creo Retail Marketing, and Deku-Pack in Denmark, were acquired during the period. The ability to fulfil customer needs in this space has also been enhanced by the recent opening of a new site in Erlensee in Germany. And the group has announced the proposed acquisition of Parish Manufacturing Inc, a US producer and supplier of bag-in-box systems - a type of container for the storage and transportation of liquids.