Paper giant Smurfit Kappa announces rise in price and shares
Shares in Smurfit Kappa have risen to the highest price in six years as the company said it is also ready to raise its prices.
The Dublin-based company said it will raise prices from today to "recover the increased costs in its corrugated pricing with the usual three-to-six-month lag. This in turn will support continued performance and growth into 2014". Shares rose as much as 3.7% to €15.05 (£13.18) – the highest since October 2007.
The jump followed new quarterly results which showed that sales at the paper and packaging giant jumped in the first half of the year but profits still fell.
Revenue rose 6% between January and June to €3.9bn (£3.41bn) but pre-tax profits were down by 31% to €127m (£111.2m) in what the company called a "current challenging operation environment''. Growth in Europe was up 2% in the same period.
The company also announced its new refinancing facility will save it as much as €13m (£11.38m) a year.
Improving circumstances in the European paper industry supported higher recycled containerboard prices and are allowing the company to announced a price increase of €50 (£44) per tonne.