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Smurfit Kappa tops FTSE 100 gainers after Irish corrugated packaging firm sees first-half profit jump

The Irish group – which earlier this year fought off an attempted takeover by International Paper – said its operating profit before exceptional items for the six months to the end of June rose by 48% to €529mln (£471mln)

Corrugated paper
The company's chief executive, Tony Smurfit, commented: “As we start the second half, business conditions remain strong"

Smurfit Kappa Group PLC (LON:SKS) was the top riser on the FTSE 100 index on Wednesday, after the Irish corrugated packaging company saw its first-half profit jump.

The group – which earlier this year fought off an attempted takeover by US giant International Paper Co. (NYSE:IP) – said its operating profit before exceptional items for the six months to the end of June rose by 48% to €529mln (£471mln) as revenue increased by 5% to €4.4bn.

READ: Smurfit Kappa not to face hostile takeover bid as US giant International Paper offer folds

The Dublin-based firm said it benefited from lower recovered fibre costs which were €73mln in the first half. The cost of recovered fibre, used in the company's products, will rise in the longer term but the short-term outlook is uncertain, it added.

The company's chief executive, Tony Smurfit, commented: “As we start the second half, business conditions remain strong. We are excited about our prospects and we continue to expect our 2018 [earnings] to be materially better than 2017."

The group raised its interim dividend by 10% to 25.4 euro cents.

Smurfit Kappa received two takeover approaches by International Paper in 2018 but the US company withdrew its interest in May when it decided not to launch a hostile bid.

The UK blue-chip firm argued it had better growth prospects alone and declined to discuss International Paper's €8.9bn proposal.

Quick facts: Smurfit Kappa Group plc

Price: 2974 GBX

LSE:SKG
Market: LSE
Market Cap: £7.1 billion
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