Prices have risen sharply, packaging giant Smurfit Kappa said today after a “remarkable” start to the year fueled by the boom in online shopping.
Managing Director Tony Smurfit said his company has experienced strong growth in corrugated volumes “in virtually every area and every market in which we operate.”
The Dublin-based packaging giant revealed a 6% increase in its underlying revenue to 2.3 billion euros (£ 2 billion) in the first quarter.
This has been accompanied by “unprecedented” supply shortages and input cost pressures, with paper prices significantly higher.
The Company’s packaging plants source most of their raw materials from the Company’s own paper mills.
Smurfit said an underlying margin of 17%, up from 17.9% in the second half of 2020, and said it was recovering higher input costs in line with its expectations.
Shares hit a record high in February after the company posted a 10% rise in pre-tax profits to 748 million euros (£ 650 million).
Smurfit said, “Our strong first quarter performance laid the groundwork for accelerated revenue and earnings growth as we move through 2021.”
In addition to its e-commerce and retail packaging, the company sells paper-based social distancing products after discovering that the virus that causes Covid-19 has a shorter lifespan on corrugated cardboard than on other materials such as steel and plastic. .