Packaging group Smurfit Kappa has reported pre-tax profits of €105m for the three months to the end of September.
This is an increase of 24% on the same time last year.
Third quarter revenues fell by 2% to €1.830 billion from €1.868 billion in challenging markets while basic earnings per share rose by 50% to 33.4 cent from 22.2 cent.
Despite macroeconomic pressures, the group said it continues to expect full year earnings before tax and amortisation to be in line with 2011.
Smurfit Kappa said its European EBITDA increased by 4% year on year in the first nine months of 2012 to €644m, in spite of a fall in revenue.
It said that paper price and other input costs increases during the period underpinned corrugated pricing which remained fairly stable. It noted that Eastern European countries performed well with 3% growth in the Polish box market.
Revenues from its Latin American operations rose to €1.032 billion in the nine months to the end of September and now represents 19% of the group's overall revenue.
The company said that the business continues to benefit from the value and contribution of its market leading kraftliner mill system. This grade saw a price increase of €50 per tonne during the quarter, bringing price increases to €90 per tonne over the last two quarters.
In recycled containerboard, it also announced a €100 per tonne price hike which has been partially implemented to date. ''With recovered paper costs on a long term upward trend, we will need further price increases to restore economic margins,'' the company cautioned.
Smurfit Kappa said it has completed two bond offerings, which reduced its future interest costs, extended its debt maturity profile and further diversified its funding sources. It noted that it has reduced its net debt by €483m in the last two years.
''These actions, which give us a debt profile appropriate to the industry and the economies in which we operate, together with the recent increase in the share freefloat of 92% following the placements by the private equity holders, have combined to address a number of issues of previous concern to the equity market,'' commented the group's chief executive Gary McGann.
He said that the company's consistent quality of earnings, along with the relentless focus on cash flow, will enable Smurfit Kappa to maintain an appropriate debt level and a sustained and progressive dividend policy. He added that the company will also continue to target acquisitions to enhance growth.
