20 June
2024
DS Smith Plc - 2023/24
Full-year RESULTS
ROBUST performance in a
challenging ENVIRONMENT
12
months to 30 April 2024
Continuing operations
|
|
Change
(reported)
|
Change
(constant currency)
|
Revenue
|
£6,822m
|
(17%)
|
(16%)
|
Adjusted operating
profit(1)
|
£701m
|
(19%)
|
(18%)
|
Profit before tax
|
£503m
|
(24%)
|
(23%)
|
Adjusted basic
EPS(1)
|
33.1p
|
(23%)
|
(22%)
|
Statutory basic EPS
|
28.0p
|
(22%)
|
(20%)
|
Dividend per share
|
18.0p
|
-
|
-
|
Return on sales
(RoS)(2)
|
10.3%
|
(20bps)
|
(10bps)
|
ROACE(3)
|
10.7%
|
(360bps)
|
(370bps)
|
See notes to financial table
below
·
Robust adjusted operating profit of £701m
(FY2022/23: £861m), in line with management expectations, against a
weak consumer demand environment and high inflation
·
Decline in like for like box volumes of 2%;
improving momentum across the year with like for like growth of 2%
in Q4 FY2023/24 vs Q4 FY2022/23
·
Strong customer relationships, innovation and high
service levels, together with strong cost management, have
partially offset downward pricing pressure
·
Lower free cashflow, reflecting our current
capital expenditure programme and a working
capital outflow, predominantly driven by commodity prices,
has resulted in 2.1x net debt/EBITDA (FY2022/23:
1.3x). Underlying working capital metrics remain consistent with
prior years
·
Ongoing capital and operational expenditure
programmes to support our customers and
improve productivity and environmental efficiency
remain on track
·
Further progress towards our 2030 Now and Next
goals;
o Replaced over 1 billion units of plastic since May 2020, ahead
of schedule
o Further greenhouse gas (GHG) reduction
- 5 per cent in the year (19 per cent compared to 2019)
·
Recommended all-share offer from International
Paper to combine the businesses and create a truly international
sustainable packaging solutions leader
Miles Roberts, Group Chief Executive,
commented:
"We are pleased to have delivered a
robust performance, despite the challenging environment, driven by
our focus on customers, quality, service and innovation together
with the benefit from our self-help productivity initiatives. I am
also very proud of the continued excellent progress in helping our
customers' sustainability challenges and to have achieved our
target of 1 billion units of plastic replaced with fibre-based
alternatives 16 months ahead of schedule.
The positive trends in packaging
volumes from the second half of last year have continued into the
current financial year and we remain focused on pricing, operational efficiency and tight cost control. The
increasing demand is resulting in higher paper and other input
costs, including OCC. We anticipate this will be reflected in
packaging price rises, with the benefits expected to be weighted to
the second half of our current financial year and provide further
momentum into FY26.
In April, we announced a
combination with International Paper through an all-share
transaction. The combination with International Paper is an
attractive opportunity to create a truly international sustainable
packaging solutions leader that is well positioned in attractive
and growing markets across Europe and North America. We are working
collaboratively with International Paper to satisfy the offer
conditions and bring about the successful completion of the
transaction."
Enquiries
DS Smith
Plc
+44 (0)20 7756 1800
Investors
Hugo Fisher, Group Investor
Relations Director
Anjali Kotak, Investor Relations
Director
Media
Greg Dawson, Corporate Affairs
Director
Brunswick
+44 (0)20 7404 5959
Simon Sporborg
Dan Roberts
There will be a webcast audio
presentation today at 9:00am BST with the slides of the full-year
results, followed by a live Q&A, given by Miles Roberts, Group
Chief Executive, and Richard Pike, Group Finance
Director.
To access the webcast, please
register
here. A
copy of the slides presented will also be available on the Group's
website, https://www.dssmith.com/investors/results-and-presentations.
If you would like to ask a question
at the end of the webcast, then you will need to dial into the
associated conference call using the following details. Please dial
in 15 minutes before the start of the webcast to allow for
registration.
Dial-in number (UK): +44 (0) 33 0551 0200
Dial-in number (UK Toll Free): 0808
109 0700
Password: DS Smith
An audio file will also be
available on https://www.dssmith.com/investors/results-and-presentations
Notes to the financial tables
Note 14 explains the use of
non-GAAP performance measures. These measures are used both
internally and externally to evaluate business performance, as a
key constituent of the Group's planning process, they are applied
in the Group's financial and debt covenants, as well as
establishing the targets against which compensation is
determined. Reporting of non-GAAP measures
alongside reported measures is considered useful to enable
investors to understand how management evaluates performance and
value creation internally, enabling them to track the Group's
adjusted performance and the key business drivers which underpin it
over time. Reported results are presented in the Consolidated
Income Statement and reconciliations to adjusted results are
presented on the face of the Consolidated Income Statement, in note
2, note 3, note 7, and note 14.
(1) Adjusted operating profit (adjusted EBITA) is before adjusting
items (as set out in note 3) and amortisation of £98
million.
(2) Operating profit before amortisation and adjusting items as
percentage of revenue.
(3) Operating profit before amortisation and adjusting items as a
percentage of the average monthly capital employed over the
previous 12-month period. Average capital employed includes
property, plant and equipment, right-of-use assets, intangible
assets (including goodwill), working capital, provisions, capital
debtors/creditors, biological assets and assets/liabilities held
for sale.
(4) Corrugated box volumes on a 12-month basis (based on area
(m2) of corrugated box sold), adjusted for working days,
on an organic basis.
(5) GDP growth for rolling 12-months (year-on-year) for the
countries in which DS Smith operates, weighted by our sales by
country = 0.8%. Source: Eurostat (15 May 2024) and ONS
(6) EBITDA being operating profit before adjusting items,
depreciation and amortisation and adjusted for the full-year effect
of acquisitions and disposals in the period. Net debt is calculated
at average exchange rates as opposed to closing rates. Ratio as
calculated in accordance with bank covenants. See note 14 on
non-GAAP measures for reconciliation.
(7) Free cash flow before tax, net interest, growth capital
expenditure, pension payments and adjusting cash flows as a
percentage of operating profit before amortisation and adjusting
items.
(8) Free cash flow is the net movement on debt before cash outflow
for adjusting items, dividends paid, acquisitions and divestment of
subsidiary businesses (including borrowings acquired) and proceeds
from issue of share capital.
Cautionary statement: This
announcement contains certain forward-looking statements with
respect to the operations, performance and financial condition of
the Group. By their nature, these statements involve uncertainty
since future events and circumstances can cause results and
developments to differ materially from those anticipated. The
forward-looking statements reflect knowledge and information
available at the date of preparation of this announcement and DS
Smith Plc undertakes no obligation to update these forward-looking
statements. Nothing in this statement should be construed as a
profit forecast.
Unless otherwise stated, all
commentary and comparable analysis in the overview and operating
review relates to the continuing operations of the Group, on a
constant currency basis.
Operating Review
Resilient performance
The macro-economic environment has
remained challenging with overall market demand continuing to be
weak, leading to a decline in like for like box volumes of 2 per
cent(4) compared to FY2022/23. Customers are starting to
increase promotional activity and stock levels, with like for like
volumes in the second half of the year showing positive
growth. The medium-term target for box
volume growth of 1.8% (GDP+1%) was significantly impacted by
inflation, in addition to lower production volumes.
The largest decline in volume was
in Northern Europe, which includes the UK and Germany, where we
have a greater weighting to industrial and e-commerce customers,
respectively. Southern Europe was relatively resilient, and our
Eastern Europe and North American divisions delivered strong volume
growth for the year.
For the 12-month period, revenue
was £6,822 million (FY2022/23: £8,221 million), down 16 per cent on
a constant currency basis and 17 per cent on a reported basis with
the decline in box volumes (£129 million) and lower selling prices
(£1,173 million). Packaging prices were down £647 million,
approximately 10 per cent, with the balance reflecting lower
external paper, recyclate and energy sales. Packaging prices have
been relatively resilient, reflecting our strong customer
relationships, ongoing innovation and continued focus on high
service levels.
Adjusted operating profit declined
18 per cent on a constant currency basis and 19 per cent on a
reported basis to £701 million (FY2022/23: £861 million). The
impact of box and other volume declines led to a £35 million
reduction in adjusted operating profit. The decline in sales price
was mostly offset by a reduction in raw material costs and cost
mitigation actions, which led to an overall decrease in costs,
excluding the impact of volume declines, of £1,059 million versus
the comparable period with a reduction in raw materials costs of
£661 million and cost mitigation initiatives and reduced other
costs totalling £398 million.
Group return on sales was 10.3 per
cent (FY2022/23: 10.5 per cent), and within our medium-term target
range of 10-12 per cent reflecting the robust operating
profit.
Basic earnings per share from
continuing operations declined 20 per cent on a constant currency
basis to 28.0 pence. Adjusted basic earnings declined by 22 per
cent on a constant currency basis to 33.1 pence per share,
reflecting the decline in profitability.
Return on average capital employed
decreased by 360 bps to 10.7 per cent reflecting the lower
profitability and below our medium-term target range of 12 to 15
per cent.
Cash flow and net debt
As previously announced, free cash
flow(8) was impacted in the period by a number of one-off items and
led to an outflow of £175 million versus a cash inflow of £354
million in FY 2022/23. The cash outflow included a working capital
outflow of £417 million including a net outflow of £137 million
(FY2022/23: net benefit of £69 million) in respect of the reversal
of prior period cash collateralisation of energy hedges which we
undertook to limit our counterparty exposure. The underlying
working capital outflow was principally driven by lower paper and
energy prices reducing trade payables. In September 2023 we paid
the final amount of £103 million for the remaining outstanding
shareholding in Interstate Resources, the majority of which we
acquired in August 2017.
Cash generated from operations
before adjusting cash items of £566 million (FY2022/23: £1,092
million) was used to invest in net capex of £506 million
(FY2022/23: £526 million).
Cash conversion(7,8), as
defined in our financial KPIs (note 14), was 39 per cent
(FY2022/23: 101 per cent), below our target of being at or above
100 per cent.
Net debt as at 30 April 2024 was
£2,230 million (30 April 2023: £1,636 million), principally due to
the increased working capital outflow and capital expenditure
described above. Our net debt/EBITDA(6) ratio (calculated in accordance
with our banking covenant requirements) is 2.1 times (2022/23: 1.3
times), substantially below our banking covenant of 3.75 times
and just above our medium-term target of at
or below 2.0 times. The Group remains fully committed to maintaining its
investment grade credit rating.
Leading the way in sustainability
Sustainability has been at the
heart of our business for many years as we have developed and grown
into a solely fibre-based corrugated packaging business and have
built our Now & Next sustainability Strategy around ambitious
near and long-term targets that confirm our commitment to the
Circular Economy and our Purpose of Redefining Packaging for a
Changing World.
Replacing one billion units of
plastic by 2025 was one of these targets and we are proud to have
achieved this target 16 months ahead of schedule. We have replaced
over 1.2 billion units of plastic with a range of new and
innovative fibre-based solutions. Everyday plastic items that have
been replaced on supermarket shelves include ready-meal trays,
fruit and vegetable punnets, plastic carriers and shrink-wrap that
is commonly found on soft drink bottles.
As well as supporting our
customers' sustainability challenges we also continue to make good
progress in delivering against our own sustainability targets. We
have reduced our total greenhouse gas (GHG) emissions by 5 per cent
in the year (19 per cent compared to 2019), strengthened our human
rights due diligence having achieved our target to roll out Sedex
SAQs (Supplier Ethical Data Exchange Self-Assessment Questionnaire)
to all sites and maintained 100 per cent of our sites engaging in
community activities.
We are delighted that our progress
on climate change was recently recognised with our CDP A List
position (achieving A grade for Climate Change, alongside A- for
Forests and Water Security) with continuing high ratings from
EcoVadis, MSCI, S&P Global and Sustainalytics.
Dividend
The Board considers the dividend to
be an extremely important component of shareholder returns. Today,
we are announcing a final dividend of 12.0p per share, taking the
total dividend for this year to 18.0 pence per share, in line with
FY 2022/23.
Subject to approval of shareholders
at the AGM to be held on 3 September 2024, the final dividend will
be paid on 4 October 2024 to shareholders on the register at the
close of business on 6 September 2024.
Our medium-term targets and key performance
indicators
We measure our performance
according to both our financial and non-financial medium-term
targets and key performance indicators. Performance against our
financial key performance indicators and medium-term targets has
been described above.
Non-financial key performance indicators
DS Smith is committed to providing
all employees with a safe and productive working environment. We
are pleased, once again, to report improvements in our safety
record, with our accident frequency rate (defined as the number of
lost time accidents per million hours worked) reducing by a further
9 per cent to 1.65, reflecting our ongoing commitment to best
practice in health and safety. We are proud that 262 out of a total
of 325 reporting sites achieved our target of zero accidents this
year and we continue to strive for zero accidents for the Group as
a whole.
In the year we achieved a good
performance in our customer service measure of OTIF (on-time,
in-full deliveries) at 96 per cent, maintaining the same level as
the prior year (96 per cent). Management remains fully committed to
our target of 97 per cent on-time, in-full deliveries and the
highest standards of service, quality and innovation to all our
customers and we will continue to strive to meet the demanding
standards our customers expect.
Combination with International Paper
DS Smith is a high-quality business
with an excellent customer focus and exceptional people and this
has been recognised by the strong interest we have seen in the
Company.
In April the boards of
International Paper Company and DS Smith recommended an all-share
combination of International Paper with DS Smith. The combination
will bring together complementary businesses to create a truly
global sustainable packaging solutions leader, with industry
leading positions in two of the most attractive geographies of
Europe and North America. The combined business will enhance our
global proposition to customers, create opportunities for
colleagues and drive value for shareholders who can remain fully
invested in such an exciting business. Both parties are working
together to satisfy the offer conditions as described in the rule
2.7 announcement on 16 April 2024 and bring about the successful
completion of the recommended all-share combination.
Further details on the proposed
transaction can be found at:
https://www.dssmith.com/investors/possible-offer-for-ds-smith-by-international-paper
Outlook
The positive trends in packaging
volumes from the second half of last year have continued into the
current financial year and we remain focused on pricing,
operational efficiency and tight cost control. The increasing
demand is resulting in higher paper and other input costs,
including OCC. We anticipate this will be reflected in packaging
price rises, with the benefits expected to be weighted to the
second half of our current financial year and provide further
momentum into FY26.
Operating Review
Northern Europe
|
Year
ended
30 April
2024
|
Year
ended
30 April
2023
|
Change -
reported
|
Change -
constant currency
|
Revenue
|
£2,598m
|
£3,132m
|
(17%)
|
(16%)
|
Adjusted operating
profit*
|
£199m
|
£212m
|
(6%)
|
(5%)
|
Return on
sales(2)
|
7.7%
|
6.8%
|
90bps
|
90bps
|
*Operating profit before
amortisation and adjusting items (refer to note 3 of the financial
statements)
In Northern Europe, like for like
corrugated box volumes across the region declined more than the
Group average due to a greater weighting of industrial and
e-commerce customers which have seen the biggest sectoral declines
over the year.
Revenues decreased by 16 per cent
in the region due to a combination of the decrease in box volumes,
reductions in sales prices for packaging and externally sold paper
as well as volumes of recycled fibre. Adjusted operating profit
decreased less than revenue, with return on sales increasing to 7.7
per cent, reflecting resilient pricing in packaging, due to a
higher proportion of indexed pricing and benefits from
restructuring announced in FY2022/23.
Southern Europe
|
Year
ended
30 April
2024
|
Year
ended
30 April
2023
|
Change -
reported
|
Change -
constant currency
|
Revenue
|
£2,532m
|
£3,150m
|
(20%)
|
(19%)
|
Adjusted operating
profit*
|
£373m
|
£501m
|
(26%)
|
(25%)
|
Return on
sales(2)
|
14.7%
|
15.9%
|
(120bps)
|
(120bps)
|
* Operating profit before
amortisation and adjusting items (refer to note 3 of the financial
statements)
Southern Europe saw a decline in
like for like box volumes approximately in line with the Group
average with France weaker than Iberia and Italy, reflecting the
weaker overall consumer market in France.
Revenue declined 19 per cent, due
to the impact of decreases in both packaging and external paper
pricing. Adjusted operating profit declined by 25 per cent compared
to the prior period, due largely to the decrease in the volume and
price of paper sold externally, although margins continued to
remain significantly above the Group's target range.
Eastern Europe
|
Year
ended
30 April
2024
|
Year
ended
30 April
2023
|
Change -
reported
|
Change -
constant currency
|
Revenue
|
£1,106m
|
£1,275m
|
(13%)
|
(13%)
|
Adjusted operating
profit*
|
£72m
|
£76m
|
(5%)
|
(4%)
|
Return on
sales(2)
|
6.5%
|
6.0%
|
50bps
|
60bps
|
* Operating profit before
amortisation and adjusting items (refer to note 3 of the financial
statements)
Like for like corrugated box
volumes in Eastern Europe grew over the period, with revenues
declining 13 per cent, principally reflecting reduced paper and
packaging prices. Return on sales improved during the period, as
adjusted operating profit was down only slightly as the lower
pricing was partially offset by lower raw material costs and
efficiency improvements, together with costs of £19 million
relating to the decision to close our Trakia paper mill in Bulgaria
in the prior year comparative.
North America
|
Year
ended
30 April
2024
|
Year
ended
30 April
2023
|
Change -
reported
|
Change
-
constant
currency
|
Revenue
|
£586m
|
£664m
|
(12%)
|
(8%)
|
Adjusted operating
profit*
|
£57m
|
£72m
|
(21%)
|
(16%)
|
Return on
sales(2)
|
9.7%
|
10.8%
|
(110bps)
|
(100bps)
|
*Operating profit before
amortisation and adjusting items (refer to note 3 of the financial
statements)
|
|
Like for like packaging volumes
grew strongly during the period, reflecting excellent customer
traction and our recent investments in additional capacity.
However, revenue in the region declined, reflecting pricing
reductions in paper and packaging.
Adjusted operating profit declined
by 16 per cent, principally reflecting the decline in paper
profitability as the region produces more paper than it currently
utilises for our own packaging production and hence retains some
exposure to the paper export market. Despite this, return on sales
margins remain attractive and the expected continued volume growth
will reduce this exposure going forward.
Financial Review
Overview
2023/24 has seen the Group deliver
robust adjusted operating profit in the context of a challenging
macroeconomic environment, characterised by soft demand, low paper
prices and higher inflation impacting input costs. We continued to
be responsive to our customers' needs and invested in our strong
relationships, while delivering innovative packaging
solutions.
The business saw revenue decline by
17 per cent (constant currency 16 per cent) as the market price of
paper and packaging reduced, coupled with a marginal decline in
packaging volumes of (2 per cent). Adjusted operating profit
reduced by 19 per cent (constant currency 18 per cent) from the
record level recorded in the previous year, reflecting the enormous
effort by our colleagues across the business to offset the external
headwinds.
Whilst the above-mentioned efforts
ensured that the return on sales of the business remained
relatively flat at 10.3 per cent (2022/23: 10.5 per cent) and
within our target range, return on average capital employed (ROACE)
for the year was 10.7 per cent (2022/23: 14.3 per cent), which was
below the target range of 12 to 15 per cent. The headline results
can be summarised as:
·
Organic corrugated box volume reduced by 2 per
cent (2022/23: a decrease of 5.8 per cent)
·
Revenue decreased 16 per cent on a constant
currency and 17 per cent on a reported basis to £6,822 million
(2022/23: £8,221 million)
·
Adjusted operating profit of £701 million, a
decline of 18 per cent on a constant currency basis and 19 per cent
on a reported basis (2022/23: £861 million)
·
18 per cent reduction in operating profit to £604
million on a reported basis; 16 per cent decrease on a constant
currency basis (2022/23: £733 million)
·
Statutory profit before tax of £503 million, a 23
per cent reduction on a constant currency basis and 24 per cent
decrease on a reported basis (2022/23: £661 million)
·
Adjusted return on sales at 10.3 per cent
(2022/23: 10.5 per cent)
·
Adjusted return on average capital employed of
10.7 per cent (2022/23: 14.3 per cent)
·
Net debt to EBITDA ratio of 2.1 times (2022/23:
1.3 times)
·
Cash conversion 39 per cent (2022/23: 101 per
cent).
Unless otherwise stated, the
commentary below references the continuing operations of the
Group.
Non-GAAP performance measures
The Group presents non-GAAP
measures alongside reported measures, in order to provide a
balanced and comparable view of the Group's overall performance and
position. Non-GAAP performance measures eliminate amortisation and
unusual or non-operational items that may obscure understanding of
the key trends and performance. These measures are used both
internally and externally to evaluate business performance, as a
key constituent of the Group's planning process, they are applied
in the Group's financial and debt covenants, as well as comprising
targets against which compensation is determined. Amortisation
relates primarily to customer contracts and relationships arising
from business combinations. Unusual or non-operational items
include business disposals, restructuring, acquisition related and
integration costs and impairments, and are referred to as adjusting
items.
Reporting of non-GAAP measures
alongside statutory measures is considered useful by investors to
understand how management evaluates performance and value creation,
enabling them to track the Group's performance and the key business
drivers which underpin it and the basis on which to anticipate
future prospects.
Note 14 explains further the use of
non-GAAP performance measures and provides reconciliations as
appropriate to information derived directly from the financial
statements. Where a non-GAAP measure is referred to in the review,
the equivalent measure stemming directly from the financial
statements (if available and appropriate) is also referred
to.
Trading results
Revenue decreased by 17 per cent on
a reported basis to £6,822 million (2022/23: £8,221 million).
Packaging prices continued to fall across the year, reflecting
ongoing soft demand and paper selling prices remained weak through
the year before starting to recover as we approached year end.
Lower selling prices reduced revenue by £1,173 million, with
packaging and other volume reductions reducing revenue by a further
£142 million.
Reported revenues are subject to
foreign currency translation effects. In the year, the euro
accounted for 60 per cent of Group revenue. As such, the movements
of the euro against sterling during the year constituted the
majority of the £84 million of adverse foreign exchange translation
impact. On a constant currency basis, revenues decreased by 16 per
cent.
Corrugated box volumes reduced by 2
per cent (2022/23: 5.8 per cent reduction) as a result of softness
in demand in our end markets. However, there was improvement in the
demand environment across the year and in the second half we saw a
marginal improvement over the prior year comparative period as
sentiment began to improve.
Adjusted operating profit of £701
million on a reported basis is a decrease of 19 per cent (2022/23:
£861 million). This is largely attributable to reducing prices
(£1,173 million) and volume reduction of £35 million, offset by
input cost reductions of £1,059 million. Constant currency decline
was 18 per cent with adverse foreign exchange translation impact to
adjusted operating profit of £11 million. As the Group exited the
year, market prices began to rise following the price reductions
experienced over the past year.
Operating profit at £604 million,
is a decline of 16 per cent on a constant currency basis and 18 per
cent on a reported basis (2022/23: £733 million), as lower
amortisation and adjusting items offset the decline in adjusted
operating profit.
On a reported basis, depreciation
increased to £323 million (2022/23: £312 million), reflective of
the continued investments in the Group's operating
assets.
Amortisation decreased to £98
million (2022/23: £113 million) due to the full year effect of
intangibles arising on earlier acquisitions completing their
amortisation term.
The key measure of return on
average capital employed reduced by 360 basis points to 10.7 per
cent (2022/23: 14.3 per cent), due to the reduction in adjusted
operating profit and higher capital employed. This performance is
below the Group's medium-term target of 12 to 15 per
cent.
The Group's adjusted return on
sales was broadly comparable to the prior year with a 20 basis
points reduction to 10.3 per cent (2022/23: 10.5 per cent),
reflecting the robustness of our business model and continued focus
on costs. It remains within the medium-term target of 10 to 12 per
cent.
Income statement - from continuing
operations
(unless otherwise stated)
|
2023/24
£m
|
2022/23
£m
|
Revenue
|
6,822
|
8,221
|
Adjusted operating
profit1
|
701
|
861
|
Operating profit
|
604
|
733
|
Adjusted return on
sales1
|
10.3%
|
10.5%
|
Adjusted net financing
costs1
|
(103)
|
(74)
|
Share of profit of equity-accounted
investments, net of tax
|
2
|
2
|
Profit before income tax
|
503
|
661
|
Adjusted profit before income
tax1
|
600
|
789
|
Adjusted income tax
expense1
|
(145)
|
(197)
|
Adjusted earnings1
|
455
|
592
|
Profit from discontinued
operations,
net of tax
|
-
|
11
|
Adjusted basic earnings per
share1
|
33.1p
|
43.0p
|
Profit for the year attributable to owners of the parent
(including discontinued operations)
|
385
|
502
|
Basic earnings per share from
continuing and discontinued operations
|
28.0p
|
36.6p
|
Basic earnings per share from
continuing operations
|
28.0p
|
35.8p
|
1 Adjusted to exclude amortisation and adjusting items (see note
3).
Adjusting items
Adjusting items before tax and
financing costs were £1 million (2022/23: £15 million loss) which
relates to a gain from the disposal of the Group's associate in
Ukraine of £10 million offset by acquisition and other adjusting
costs of £9 million.
Interest, tax and earnings per share
Net finance costs were £103 million
(2022/23: £74 million). The increase of £29 million over the prior
year is a function of the higher interest rate environment coupled
with the refinancing of prior year bonds. The employment benefit
net finance expense of £1 million is in line with the prior
year.
The share of profits of
equity-accounted investments remained at £2 million (2022/23: £2
million).
Profit before tax decreased by 24
per cent on a reported basis to £503 million (2022/23: £661
million), driven by the decrease in operating profit and increased
financing costs offset by a reduction in amortisation. Adjusted
profit before tax of £600 million (2022/23: £789 million) decreased
by 24 per cent on a reported basis, again due to the decrease in
the underlying adjusted operating profit.
The tax charge of £118 million
(2022/23: £169 million) reflects the lower profits versus the prior
year. The Group's effective tax rate on adjusted profit, excluding
amortisation, adjusting items and associates, was 24.2 per cent
(2022/23: 25.0 per cent).
Reported profit after tax,
amortisation and adjusting items for continuing and discontinued
operations was £385 million (2022/23: £503 million). The decrease
in operating profit led to a reduction of 22 per cent in basic
earnings per share from continuing operations on a reported basis
to 28.0 pence (2022/23: 35.8 pence), with adjusted earnings per
share from continuing operations 23 per cent lower at 33.1 pence
(2022/23: 43.0 pence) on a reported basis, 22 per cent lower on a
constant currency basis.
Acquisitions and disposals
In recent years, the Group's
strategy has focused on organic growth in order to support growth
with our major customers.
During the year the Group acquired
Bosis d.o.o, a high-quality packaging company in Serbia, for €20
million (net of cash and cash equivalents), complementing the
Group's existing regional packaging activity in Eastern
Europe.
The acquisition of the final 10 per
cent holding in Interstate Resources was completed in the year with
a final payment of $129 million.
Cash flow
Reported net debt of £2,230 million
(30 April 2023: £1,636 million) has increased from the prior year,
with a reduction in EBITDA from the record performance in the
previous year and a net working capital outflow of £417 million,
due largely to the decline in energy prices and paper raw material
purchase prices during the financial year, net capital expenditure
of £506 million and higher tax payments. The working capital
outflows were mitigated by maintaining focus on cash management, in
particular cash collection and inventory management, but these were
insufficient to offset the commodity price moves. In order to
manage counterparty credit risk of the Group's energy derivatives
the Group agreed resets of certain derivatives with the
counterparties to reduce the risk. The unwind in the current year
of prior year resets contributed to a net working capital outflow
of £137 million, compared to an inflow of £69 million in the prior
year.
Trade receivables factoring is £9
million higher than April 2023 at £369 million. This remains a
reduction of some 34 per cent from the peak balance of £559 million
in 2018. Going forward the Group expects to continue to sell high
credit quality receivables under this programme within the range
£350-400 million outstanding at any one time. Such arrangements
enable the Group to optimise its working capital position and
reduces the quantum of early payment discounts given.
Net capital expenditure decreased
by £20 million to £506 million in the year. The Group continued to
focus on growth and efficiency capital projects, the most
significant elements of which related to the replacement paper
making line in Italy, the replacement recovery boiler in Portugal
and the new biomass boiler in France. Proceeds from the disposal of
property, plant and equipment were £41 million (2022/23: £19
million), which included assets becoming surplus as a result of the
prior year restructuring, including UK recycling sites, the Berlin
packaging site and other non-core assets.
In the year, the remaining cash
payment of $129 million occurred relating to the acquisition cost
of the Interstate Resources acquisition following the settlement of
the put option, and the acquisition of Bosis d.o.o. in Serbia was
completed for €20 million.
Tax paid of £169 million is £33
million higher than the prior year, driven by increasing levels of
profit in the prior year.
Net interest payments of £66
million decreased by £10 million with higher interest costs being
offset by the timing of payments on the Eurobond that was issued
during the year.
Cash outflows associated with
adjusting items decreased by £3 million to £11 million as
programmes which commenced in previous years concluded.
Disposal proceeds of £5 million
related to the first tranche of the cash flow from the sale of the
Group's associate in Ukraine.
Cash generated from operations
before adjusting cash items was an inflow of £566 million,
(2022/23: £1,092 million inflow). Net cash flow was an outflow of
£543 million, a £592 million decrease on the prior year. This
reflects the effect of working capital outflows in the current
year, increased tax payments and the outflow relating to the
payment of the put option for the final consideration of Interstate
Resources. Cash conversion at 39 per cent was lower than the
previous year (2022/23: 101 per cent) due to the lower adjusted
operating profit and cash outflow relating to working
capital.
Cash flow - from continuing
operations
|
2023/24
£m
|
2022/23
£m
|
Cash generated from operations before
adjusting cash items
|
566
|
1,092
|
Capital expenditure (net of disposal
of fixed assets)
|
(506)
|
(526)
|
Tax paid
|
(169)
|
(136)
|
Net interest paid
|
(66)
|
(76)
|
Free
cash flow
|
(175)
|
354
|
Cash outflow for adjusting
items
|
(11)
|
(14)
|
Dividends
|
(247)
|
(289)
|
Acquisitions and disposals of
businesses, net of cash and cash equivalents
|
(108)
|
-
|
Other
|
(2)
|
(2)
|
Net
cash flow
|
(543)
|
49
|
Issue of share capital
|
7
|
4
|
Foreign exchange, fair value and
other movements
|
(58)
|
(205)
|
Net
debt movement
|
(594)
|
(152)
|
Opening net debt
|
(1,636)
|
(1,484)
|
Closing net debt
|
(2,230)
|
(1,636)
|
Statement of financial position
At 30 April 2024, shareholder funds
were £3,949 million, a decrease from £4,084 million in the prior
year. The key movements are profit attributable to shareholders of
£385 million (2022/23: £502 million), together with an actuarial
loss on employee benefits of £2 million (2022/23: £11 million gain)
and foreign currency translation loss of £147 million (2022/23:
gain of £194 million), with a net reduction in the cash flow hedge
reserve of £211 million (2022/23: £645 million reduction) driven by
the significant reduction in the underlying value of our commodity
hedge positions as energy prices fell. Dividends paid in the year
were £247 million (2022/23: £289 million). Equity attributable to
non-controlling interests was £nil (2022/23: £3 million
positive).
The Group's banking covenants
stipulate the methodology upon which the net debt to adjusted
earnings before interest, tax, depreciation and amortisation
(EBITDA) ratio is to be calculated. The effects of IFRS 16 Leases,
adopted since 1 May 2019, are excluded by the banks from the
ratio's determination. The ratio has increased to 2.1 times, with a
reduction in adjusted EBITDA and an increase in adjusted net debt.
This represents an increase from the previous year-end position of
1.3 times. The ratio remains well inside the covenant requirements,
which across all banking debt is 3.75 times. The Group's publicly
traded euro and sterling bonds are not subject to any financial
covenants. The bonds are, however, subject to a coupon step up of
125 basis points for any period the Group falls below an investment
grade credit rating.
The covenant calculations also
exclude income statement items identified as adjusting by the Group
and any interest arising from the defined benefit pension schemes.
At 30 April 2024, the Group has substantial headroom under its
covenants, with the future outlook assessed as part of the annual
going concern review. The Group's investment grade credit rating
from Standard & Poor's remains stable at investment grade,
which takes into account all the items excluded from covenant
calculations and working capital.
Statement of financial
position
|
30 April
2024
£m
|
30 April
2023
£m
|
Intangible assets
|
2,811
|
2,927
|
Property, plant and
equipment
|
3,743
|
3,529
|
Right-of-use assets
|
237
|
224
|
Inventories
|
591
|
619
|
Trade and other
receivables
|
1,134
|
1,257
|
Cash and cash equivalents
|
499
|
472
|
Derivative financial
instruments
|
79
|
319
|
Employee benefits
|
50
|
24
|
Other
|
110
|
86
|
Total assets
|
9,254
|
9,457
|
Bank overdrafts
|
(89)
|
(104)
|
Borrowings
|
(2,437)
|
(1,816)
|
Trade and other payables
|
(1,850)
|
(2,287)
|
Provisions
|
(68)
|
(65)
|
Employee benefits
|
(82)
|
(79)
|
Lease liabilities
|
(239)
|
(224)
|
Derivative financial
instruments
|
(193)
|
(368)
|
Other
|
(347)
|
(427)
|
Total liabilities
|
(5,305)
|
(5,370)
|
Net
assets
|
3,949
|
4,087
|
Net
debt
|
2,230
|
1,636
|
Net
debt to EBITDA ratio
|
2.1x
|
1.3x
|
Energy costs
Production facilities, in
particular paper mills, are energy intensive resulting in
significant costs for the Group. In 2023/24, costs for gas,
electricity and other fuels, net of periodic local incentives, were
£601 million (2022/23: £669 million). The year saw significant
reductions in prices in the first half year, which eased into the
second half, with energy costs for the first half year of £309
million decreasing to £292 million in the second half year
(2022/23: H1 £400 million, H2 £269 million). The Group's energy
sales reduced compared with the prior year. The Group continues to
invest in energy efficiency projects and limits the exposure to
volatile energy pricing by hedging energy costs with suppliers and
financial institutions, managed by the Group's Energy Procurement
team.
Capital structure and treasury management
In addition to its trading cash
flow, the Group finances its operations using a combination of
borrowings, property and equipment leases, shareholders' equity
and, where appropriate, disposals of non-core businesses. The
Group's funding strategy is to achieve a capital structure that
provides an appropriate cost of capital whilst providing the
desired flexibility in short and medium-term funding to enable the
execution of material investments or acquisitions, as
required.
The Group aims to maintain a strong
balance sheet enabling significant headroom within the financial
covenants and to ensure continuity of funding by having a range of
maturities from a variety of sources. The Group has an investment
grade rating from Standard & Poor's of BBB-, with a positive
outlook.
The Group's overarching treasury
objective is to ensure sufficient funds are available for the Group
to execute its strategy and to manage the financial risks to which
the Group is exposed.
In November 2018, the Group signed
a £1.4 billion five-year committed syndicated revolving credit
facility (RCF) with its core banks. The second extension option was
exercised in November 2020. A further extension was agreed in June
2024, such that the new facility of £1.25 billion matures in May
2027.
In July 2023 the Group issued two
inaugural Green Bonds, to a value of €1.5 billion (€850 million due
2027 and €650 million due 27 July 2030), significantly lengthening
our maturity profile and securing long-term committed financing for
the business. The net proceeds of the issuance will be used to
finance or refinance eligible activities in accordance with DS
Smith's Green Finance Framework. The undrawn £500 million term loan
facility signed in April 2023 was cancelled upon issuance of the
green bonds.
Available cash and debt facilities
are reviewed regularly to ensure sufficient funds are available to
support the Group's activities. At 30 April 2024, the Group's
committed facilities totalled £3.9 billion, of which £1.5 billion
remained undrawn and £3.5 billion matures beyond one year or more.
Undrawn committed borrowing facilities are maintained to provide
protection against refinancing risk.
At 30 April 2024, the committed
borrowing facilities had a weighted average maturity of 2.7 years
(30 April 2023: 2.4 years). Additional detail on these facilities
is provided below. Total gross borrowings at 30 April 2024 were
£2,437 million (30 April 2023: £1,816 million). The committed
borrowing facilities described do not include the £427 million of
committed factoring facilities, which allow the sale of receivables
without recourse. Given the committed nature of these facilities,
they fully protect the Group from any short-term liquidity risks
which may arise from volatility in financial markets.
As described above, the Group
continues to sell trade receivables without recourse, a process by
which the trade receivables balance sold is de-recognised, with
proceeds then presented within operating cash flows.
The Group maintains a €1 billion
Euro Commercial Paper Programme. There was no issued commercial
paper at 30 April 2024.
Facilities
|
Currency
|
Maturity
date
|
£m
equivalent
|
Syndicated RCF 2018
|
Various
|
2024-25
|
1,400
|
Euro medium-term notes
|
EUR
|
2024-30
|
2,182
|
Euro RCF 2020
|
EUR
|
2025
|
51
|
Sterling bond medium-term
note
|
GBP
|
2029
|
250
|
Euro term loan
|
EUR
|
2025
|
9
|
Committed facilities at
30 April 2024
|
|
|
3,892
|
Impairment
The net book value of goodwill and
other intangibles at 30 April 2024 was £2,811 million (30 April
2023: £2,927 million).
IAS 36 Impairment of Assets
requires annual testing of goodwill and other intangible assets, as
well as an assessment of any other assets for which there may be
indicators of impairment. As part of this testing, the Group
compares the carrying amount of the assets subject to testing with
the higher of their net realisable value and value-in-use to
identify whether any impairment exists. The asset or group of
assets' value-in-use is determined by discounting the future cash
flows they expect to generate from the basis of the Group's
weighted average cost of capital (WACC) of 9.5 per cent (2022/23:
9.5 per cent), plus a blended country risk premium for each group
of assets. Asset values were tested at 30 April 2024, with no
impairment identified as a result of the testing
performed.
Pensions
The Group's primary funded defined
benefit pension scheme, based in the UK, is closed to future
accrual. There are a variety of other post-retirement and employee
benefit schemes operated locally for overseas operations, and an
additional unfunded scheme in the UK relating to three former
directors which is secured against assets of the UK business. In
accordance with IAS 19 Employee Benefits (Revised 2011), the Group
is required to make assumptions surrounding rates of inflation,
discount rates and current and future life expectancies, amongst
others, which could materially impact the value of any scheme
surplus or liability. A material revaluation of the relevant assets
and liabilities could result in a change to the cost to fund the
scheme liabilities.
The assumptions applied are subject
to periodic review. A summary of the balance sheet position at 30
April is as follows:
|
30
April
2024
£m
|
30
April
2023
£m
|
Aggregate gross assets of
schemes
|
820
|
848
|
Aggregate gross liabilities of
schemes
|
(852)
|
(903)
|
Balance sheet deficit
|
(32)
|
(55)
|
Deferred tax assets
|
7
|
14
|
Net
balance sheet deficit
|
(25)
|
(41)
|
The net deficit has decreased
versus prior year mainly due to an increase in discount rate
assumptions at 30 April 2024 partially offset by a fall in the
asset valuations.
The 2022 triennial valuation of the
main UK scheme incorporated updates to underlying scheme
assumptions, including demographic and life expectancy rates,
which, along with updates surrounding mortality and proportion
married assumptions and future improvements, resulted in a net
decrease of circa 9 per cent in the valuation of the scheme
liabilities. No changes were made to the previously approved
funding plan following the triennial valuation.
Total cash contributions paid into
the Group pension schemes, reported within cash generated from
operations in the cash flow, were £24 million in 2023/24 (2022/23:
£25 million), which primarily constitute the agreed contributions
under the UK defined benefit scheme deficit recovery
plan.
Consolidated income statement
Year ended 30 April 2024
Continuing operations
|
Note
|
Before
adjusting
items
2024
£m
|
Adjusting
items
2024
(note 3)
£m
|
After
adjusting
items
2024
£m
|
Before
adjusting
items
2023
£m
|
Adjusting
items
2023
(note 3)
£m
|
After
adjusting
items
2023
£m
|
Revenue
|
2
|
6,822
|
-
|
6,822
|
8,221
|
-
|
8,221
|
Operating costs
|
|
(6,121)
|
-
|
(6,121)
|
(7,360)
|
-
|
(7,360)
|
Operating profit before
amortisation,
acquisitions and divestments
|
2
|
701
|
-
|
701
|
861
|
-
|
861
|
Amortisation of intangible
assets;
acquisitions and divestments
|
3
|
(98)
|
1
|
(97)
|
(113)
|
(15)
|
(128)
|
Operating profit
|
|
603
|
1
|
604
|
748
|
(15)
|
733
|
Finance income
|
5
|
14
|
-
|
14
|
2
|
-
|
2
|
Finance costs
|
5
|
(116)
|
-
|
(116)
|
(75)
|
-
|
(75)
|
Employment benefit net finance
expense
|
4
|
(1)
|
-
|
(1)
|
(1)
|
-
|
(1)
|
Net financing costs
|
|
(103)
|
-
|
(103)
|
(74)
|
-
|
(74)
|
Profit after financing
costs
|
|
500
|
1
|
501
|
674
|
(15)
|
659
|
Share of profit of equity accounted
investments, net of tax
|
|
2
|
-
|
2
|
2
|
-
|
2
|
Profit before income tax
|
|
502
|
1
|
503
|
676
|
(15)
|
661
|
Income tax
(expense)/credit
|
6, 3
|
(119)
|
1
|
(118)
|
(172)
|
3
|
(169)
|
Profit for the year from continuing
operations
|
|
383
|
2
|
385
|
504
|
(12)
|
492
|
Discontinued operations
|
|
|
|
|
|
|
|
Profit for the year from
discontinued operations,
net of tax
|
|
-
|
-
|
-
|
-
|
11
|
11
|
Profit for the year
|
|
383
|
2
|
385
|
504
|
(1)
|
503
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the year attributable
to:
|
|
|
|
|
|
|
|
Owners of the parent
|
|
383
|
2
|
385
|
503
|
(1)
|
502
|
Non-controlling interests
|
|
-
|
-
|
-
|
1
|
-
|
1
|
Earnings per share
|
|
|
|
|
|
|
|
Earnings per share from continuing
and discontinued operations
|
|
|
|
|
Basic
|
7
|
|
|
28.0p
|
|
|
36.6p
|
Diluted
|
7
|
|
|
27.9p
|
|
|
36.3p
|
Earnings per share from continuing
operations
|
|
|
|
|
|
|
|
Basic
|
7
|
|
|
28.0p
|
|
|
35.8p
|
Diluted
|
7
|
|
|
27.9p
|
|
|
35.5p
|
Adjusted earnings per share from
continuing operations
|
|
|
|
|
|
|
Basic
|
7
|
|
33.1p
|
|
|
43.0p
|
|
Diluted
|
7
|
|
32.9p
|
|
|
42.7p
|
|
Consolidated statement of comprehensive
income
Year ended 30 April 2024
|
Note
|
2024
£m
|
2023
£m
|
Profit for the year
|
|
385
|
503
|
Items which will not be reclassified
subsequently to profit or loss
|
|
|
|
Actuarial (loss)/gain on employee
benefits
|
4
|
(2)
|
11
|
Income tax on items which will not
be reclassified subsequently to profit or loss
|
|
1
|
(2)
|
Items which may be reclassified
subsequently to profit or loss
|
|
|
|
Foreign currency translation
differences
|
|
(147)
|
194
|
Reclassification to income statement
on asset write-down
|
|
-
|
(3)
|
Cash flow hedges fair value
changes
|
|
(236)
|
(72)
|
Reclassification from cash flow
hedge reserve to income statement
|
|
25
|
(573)
|
Movement in net investment
hedge
|
|
41
|
(74)
|
Income tax on items which may be
reclassified subsequently to profit or loss
|
|
43
|
149
|
Other comprehensive (expense)/income
for the year, net of tax
|
|
(275)
|
(370)
|
Total comprehensive income for the year
|
|
110
|
133
|
Total comprehensive income attributable to:
|
|
|
|
Owners of the parent
|
|
110
|
132
|
Non-controlling interests
|
|
-
|
1
|
Consolidated statement
of financial position
At 30 April 2024
|
Note
|
2024
£m
|
2023
£m
|
Assets
|
|
|
|
Non-current assets
|
|
|
|
Intangible assets
|
|
2,811
|
2,927
|
Biological assets
|
|
11
|
11
|
Property, plant and
equipment
|
|
3,743
|
3,529
|
Right-of-use assets
|
|
237
|
224
|
Equity accounted
investments
|
|
17
|
17
|
Other investments
|
|
17
|
17
|
Employee benefits
|
4
|
50
|
24
|
Deferred tax assets
|
|
23
|
11
|
Other receivables
|
|
4
|
1
|
Derivative financial
instruments
|
|
15
|
165
|
Total non-current assets
|
|
6,928
|
6,926
|
Current assets
|
|
|
|
Inventories
|
|
591
|
619
|
Biological assets
|
|
5
|
6
|
Income tax receivable
|
|
37
|
24
|
Trade and other
receivables
|
|
1,130
|
1,256
|
Cash and cash equivalents
|
|
499
|
472
|
Derivative financial
instruments
|
|
64
|
154
|
Total current assets
|
|
2,326
|
2,531
|
Total assets
|
|
9,254
|
9,457
|
Liabilities
|
|
|
|
Non-current liabilities
|
|
|
|
Borrowings
|
|
(2,040)
|
(1,742)
|
Employee benefits
|
4
|
(82)
|
(79)
|
Other payables
|
|
(31)
|
(34)
|
Provisions
|
|
(8)
|
(11)
|
Lease liabilities
|
|
(164)
|
(154)
|
Deferred tax liabilities
|
|
(213)
|
(262)
|
Derivative financial
instruments
|
|
(71)
|
(49)
|
Total non-current
liabilities
|
|
(2,609)
|
(2,331)
|
Current liabilities
|
|
|
|
Bank overdrafts
|
|
(89)
|
(104)
|
Borrowings
|
|
(397)
|
(74)
|
Trade and other payables
|
|
(1,819)
|
(2,253)
|
Income tax liabilities
|
|
(134)
|
(165)
|
Provisions
|
|
(60)
|
(54)
|
Lease liabilities
|
|
(75)
|
(70)
|
Derivative financial
instruments
|
|
(122)
|
(319)
|
Total current liabilities
|
|
(2,696)
|
(3,039)
|
Total liabilities
|
|
(5,305)
|
(5,370)
|
Net assets
|
|
3,949
|
4,087
|
Equity
|
|
|
|
Issued capital
|
|
138
|
138
|
Share premium
|
|
2,258
|
2,251
|
Reserves
|
|
1,553
|
1,695
|
Total equity attributable to owners
of the parent
|
|
3,949
|
4,084
|
Non-controlling interests
|
|
-
|
3
|
Total equity
|
|
3,949
|
4,087
|
Approved by the Board of Directors of DS Smith
Plc on 20 June 2024 and signed on its
behalf by:
M W Roberts
R Pike
Director
Director
The accompanying notes are an integral part of
these consolidated financial statements.
Consolidated statement
of changes in equity
Year ended 30 April 2024
|
Note
|
Share
capital
£m
|
Share
premium
£m
|
Hedging
reserve
£m
|
Translation
reserve
£m
|
Own
shares
£m
|
Retained earnings1 £m
|
Total equity
attributable
to owners of the parent
£m
|
Non-controlling
interests
£m
|
Total
equity
£m
|
At 1 May 2022
|
|
137
|
2,248
|
609
|
(105)
|
(9)
|
1,352
|
4,232
|
2
|
4,234
|
Profit for the year
|
|
-
|
-
|
-
|
-
|
-
|
502
|
502
|
1
|
503
|
Actuarial gain on employee
benefits
|
|
-
|
-
|
-
|
-
|
-
|
11
|
11
|
-
|
11
|
Reclassification to income statement
on asset write-down
|
|
-
|
-
|
-
|
-
|
-
|
(3)
|
(3)
|
-
|
(3)
|
Foreign currency translation
differences
|
|
-
|
-
|
-
|
194
|
-
|
-
|
194
|
-
|
194
|
Cash flow hedges fair value
changes
|
|
-
|
-
|
(72)
|
-
|
-
|
-
|
(72)
|
-
|
(72)
|
Reclassification from cash flow
hedge reserve to income statement
|
|
-
|
-
|
(573)
|
-
|
-
|
-
|
(573)
|
-
|
(573)
|
Movement in net investment
hedge
|
|
-
|
-
|
-
|
(74)
|
-
|
-
|
(74)
|
-
|
(74)
|
Income tax on other comprehensive
income
|
-
|
-
|
149
|
-
|
-
|
(2)
|
147
|
-
|
147
|
Total comprehensive
(expense)/income
|
-
|
-
|
(496)
|
120
|
-
|
508
|
132
|
1
|
133
|
Issue of share capital
|
|
1
|
3
|
-
|
-
|
-
|
-
|
4
|
-
|
4
|
Employee share trust
|
|
-
|
-
|
-
|
-
|
(5)
|
(3)
|
(8)
|
-
|
(8)
|
Share-based payments
(net of tax)
|
|
-
|
-
|
-
|
-
|
-
|
13
|
13
|
-
|
13
|
Dividends paid
|
8
|
-
|
-
|
-
|
-
|
-
|
(289)
|
(289)
|
-
|
(289)
|
Other changes in equity in the
year
|
1
|
3
|
-
|
-
|
(5)
|
(279)
|
(280)
|
-
|
(280)
|
At 30 April 2023
|
|
138
|
2,251
|
113
|
15
|
(14)
|
1,581
|
4,084
|
3
|
4,087
|
Profit for the year
|
|
-
|
-
|
-
|
-
|
-
|
385
|
385
|
-
|
385
|
Actuarial loss on employee
benefits
|
|
-
|
-
|
-
|
-
|
-
|
(2)
|
(2)
|
-
|
(2)
|
Foreign currency translation
differences
|
|
-
|
-
|
-
|
(147)
|
-
|
-
|
(147)
|
-
|
(147)
|
Cash flow hedges fair value
changes
|
|
-
|
-
|
(236)
|
-
|
-
|
-
|
(236)
|
-
|
(236)
|
Reclassification from cash flow
hedge reserve to income statement
|
|
-
|
-
|
25
|
-
|
-
|
-
|
25
|
-
|
25
|
Movement in net investment
hedge
|
|
-
|
-
|
-
|
41
|
-
|
-
|
41
|
-
|
41
|
Income tax on other comprehensive
income
|
-
|
-
|
41
|
2
|
-
|
1
|
44
|
-
|
44
|
Total comprehensive
(expense)/income
|
-
|
-
|
(170)
|
(104)
|
-
|
384
|
110
|
-
|
110
|
Issue of share capital
|
|
-
|
7
|
-
|
-
|
-
|
-
|
7
|
-
|
7
|
Employee share trust
|
|
-
|
-
|
-
|
-
|
5
|
(9)
|
(4)
|
-
|
(4)
|
Share-based payments (net of
tax)
|
|
-
|
-
|
-
|
-
|
-
|
(4)
|
(4)
|
-
|
(4)
|
Dividends paid
|
8
|
-
|
-
|
-
|
-
|
-
|
(247)
|
(247)
|
-
|
(247)
|
Transactions with non-controlling
interests
|
|
-
|
-
|
-
|
-
|
-
|
3
|
3
|
(3)
|
-
|
Other changes in equity in the
year
|
-
|
7
|
-
|
-
|
5
|
(257)
|
(245)
|
(3)
|
(248)
|
At 30 April 2024
|
|
138
|
2,258
|
(57)
|
(89)
|
(9)
|
1,708
|
3,949
|
-
|
3,949
|
1. Retained earnings include a reserve related
to merger relief.
Consolidated statement
OF CASH FLOWS
Year ended 30 April 2024
Continuing operations
|
Note
|
2024
£m
|
2023
£m
|
Operating activities
|
|
|
|
Cash generated from
operations
|
10
|
555
|
1,078
|
Interest received
|
|
14
|
2
|
Interest paid
|
|
(80)
|
(78)
|
Tax paid
|
|
(169)
|
(136)
|
Cash flows from operating
activities
|
|
320
|
866
|
Investing activities
|
|
|
|
Acquisition of subsidiary
businesses, net of cash and cash equivalents
|
13(a)
|
(113)
|
-
|
Divestment of equity accounted
investment
|
13(a)
|
5
|
-
|
Capital expenditure
|
|
(547)
|
(545)
|
Proceeds from sale of property,
plant and equipment and intangible assets
|
|
41
|
19
|
Cash outflows from
restricted cash and other deposits
|
|
-
|
(2)
|
Other investing
activities
|
|
-
|
2
|
Cash flows used in investing
activities
|
|
(614)
|
(526)
|
Financing activities
|
|
|
|
Proceeds from issue of share
capital
|
|
7
|
4
|
Repayment of borrowings
|
|
(616)
|
(679)
|
Proceeds from borrowings
|
|
1,284
|
332
|
(Payments)/proceeds from derivative
financial instruments
|
|
(2)
|
14
|
Repayment of principal on lease
liabilities
|
|
(72)
|
(106)
|
Dividends paid to Group
shareholders
|
8
|
(247)
|
(289)
|
Other financing
activities
|
|
(2)
|
(4)
|
Cash flows from/(used in) financing
activities
|
|
352
|
(728)
|
Increase/(decrease) in cash and cash
equivalents
|
|
58
|
(388)
|
Net cash and cash equivalents at
beginning of the year
|
|
368
|
746
|
Exchange (losses)/gains on cash and
cash equivalents
|
|
(16)
|
10
|
Net cash and cash equivalents at end
of the year
|
|
410
|
368
|
Notes to the consolidated financial
statements
1. Significant accounting policies
(a) Basis of preparation
(i) Consolidated financial statements
These financial statements are the consolidated
financial statements for the Group consisting of DS Smith Plc, a
company registered in England and Wales, and all its subsidiaries.
The consolidated financial statements have been prepared and
approved by the Directors in accordance with the recognition,
measurement and presentation requirements of UK-adopted
International Accounting Standards (IFRS)) as issued by the
International Accounting Standards Board (IASB), and the
requirements of the Companies Act 2006. UK adopted IFRS are
equivalent to those issued by the IASB for the purposes of the
consolidated financial statements.
The consolidated financial statements are
prepared on the historical cost basis with the exception of
biological assets, other investments, assets and liabilities of
certain financial instruments and employee benefit plans that are
stated at their fair value and share-based payments that are stated
at their grant date fair value.
The consolidated financial statements have been
prepared on a going concern basis. The Directors consider that
adequate resources exist for the Group to continue in
operational existence for the period to 31 October 2025.
The preparation of consolidated financial
statements requires management to make judgements, estimates and
assumptions that affect whether and how policies are applied,
and the reported amounts of assets and liabilities, income and
expenses.
(ii) Climate change
The Group has considered the impact of climate
change in preparing these consolidated financial statements,
including the effect upon the application of its accounting
policies, judgements, estimates and assumptions. In making its
assessments of the impact the Group considered the risks identified
through its risk management processes, the Task Force on
Climate-related Financial Disclosures (TCFD) and its defined
sustainability targets.
These considerations, which are core to the
Group's strategy, did not have a material impact on any accounting
estimates and judgements including the following areas:
• The estimates
of future cash flows used in the impairment assessment of goodwill
and going concern;
• The
assessment of residual values and estimated useful economic
lives of property, plant and equipment; and
• The adequacy
of provisions for liabilities.
The impact of climate change will evolve in
future periods and the Group will continue to assess
this.
(iii) Discontinued operations
The Group classifies non-current assets and
disposal groups as held for sale if their carrying amounts will be
recovered principally through a sale transaction rather than
through continuing use. Non-current assets and disposal groups
classified as held for sale are measured at the lower of their
carrying amount and fair value less costs to sell. Costs to sell
are the incremental costs directly attributable to the disposal of
an asset or disposal group, excluding finance costs and income tax
expense.
The criteria for held for sale classification is
regarded as met only when the sale is highly probable and the asset
or disposal group is available for immediate sale in its present
condition. Actions required to complete the sale should indicate
that it is unlikely that significant changes to the sale will be
made or that the decision to sell will be withdrawn. Management
must be committed to the plan to sell the asset and the sale is
expected to be completed within one year from the date of the
classification.
Assets and liabilities classified as held for
sale are presented separately as current items in the statement of
financial position.
Discontinued operations are excluded from the
results of continuing operations and are presented as a single
amount as profit or loss after tax from discontinued operations in
the income statement. Cash flows generated from discontinued
operations are presented as a single item in the statement of
cash flows.
All other notes to the financial statements
include amounts for continuing operations.
(iv) New accounting standards adopted
The following amended standards and
interpretations were adopted by the Group during the year ending 30
April 2024. These amended standards and interpretations have not
had a significant impact on the consolidated financial
statements.
• IFRS 17
Insurance Contracts;
• IAS 12 Income
Taxes - International Tax Reform - Pillar Two
Model Rules;
• Amendments to
IAS 12 Income Taxes - Deferred Tax related to Assets and
Liabilities arising from a Single Transaction;
• Amendments to
IAS 1 Presentation of Financial Statements and IFRS Practice
Statement 2 Making Materiality Judgements - Disclosure of
Accounting Policies; and
• Amendments to
IAS 8 Accounting Policy Changes in Accounting Estimates and Errors
- Definition of Accounting Estimates.
The accounting policies set out above have been
applied consistently in all periods presented in these consolidated
financial statements. The accounting policies have been
applied consistently by all Group entities.
(v) Changes to accounting standards not yet
adopted
The standards not yet adopted are currently not
expected to have a material impact on the consolidated financial
statements of the Group.
2. Segment reporting
Operating segments
IFRS 8 Operating
Segments requires operating segments to be identified on the
same basis as is used internally for the review of performance and
allocation of resources by the Group Chief Executive (who is the
Chief Operating Decision Maker as defined by IFRS 8).
The Group's continuing operations are organised
into segments which cover geographical regions with integrated
packaging and paper businesses. These comprise the Group's
reportable segments and their results are regularly reviewed
by the Group Chief Executive. The measure of profitability
reported to the Group Chief Executive for the purposes of resource
allocation and assessment of performance is adjusted operating
profit, which is a non-GAAP performance measure, about which
further information is provided in note 14.
Segment results include items directly
attributable to a segment as well as those that can be allocated on
a reasonable basis. Central administration costs are allocated to
the individual segments on a consistent basis year-on-year. All
assets and liabilities have been analysed by segment, except for
items of a financing nature, taxation balances, employee benefit
liabilities and current and non-current asset investments. Debt and
associated interest are managed at a Group level and therefore have
not been allocated across the segments.
Year ended 30 April 2024
|
|
Note
|
Northern
Europe
£m
|
Southern
Europe
£m
|
Eastern
Europe
£m
|
North
America
£m
|
Total continuing operations
£m
|
External revenue
|
|
|
2,598
|
2,532
|
1,106
|
586
|
6,822
|
Adjusted EBITDA1
|
|
|
310
|
497
|
127
|
90
|
1,024
|
Depreciation
|
|
|
(111)
|
(124)
|
(55)
|
(33)
|
(323)
|
Adjusted operating
profit1
|
|
|
199
|
373
|
72
|
57
|
701
|
Unallocated items:
|
|
|
|
|
|
|
|
Amortisation
|
|
|
|
|
|
|
(98)
|
Adjusting items in operating
profit
|
|
3
|
|
|
|
|
1
|
Total operating profit (continuing
operations)
|
|
|
|
|
604
|
Unallocated items:
|
|
|
|
|
|
|
|
Net financing costs
|
|
|
|
|
|
|
(103)
|
Share of profit of equity accounted
investments, net of tax
|
|
|
|
|
|
2
|
Profit before income tax
|
|
|
|
|
|
|
503
|
Income tax expense
|
|
|
|
|
|
|
(118)
|
Profit for the year (continuing
operations)
|
|
|
|
|
|
|
385
|
Analysis of total assets and total
liabilities
|
|
|
|
|
|
Segment assets
|
|
|
2,512
|
3,197
|
1,469
|
1,354
|
8,532
|
Unallocated items:
|
|
|
|
|
|
|
|
Equity accounted investments and
other investments
|
|
|
|
|
|
|
34
|
Derivative financial
instruments
|
|
|
|
|
|
|
79
|
Cash and cash equivalents
|
|
|
|
|
|
|
499
|
Tax
|
|
|
|
|
|
|
60
|
Employee benefits
|
|
|
|
|
|
|
50
|
Total assets
|
|
|
|
|
|
|
9,254
|
|
|
|
|
|
|
|
|
Segment liabilities
|
|
|
(990)
|
(762)
|
(238)
|
(110)
|
(2,100)
|
Unallocated items:
|
|
|
|
|
|
|
|
Borrowings, overdrafts and interest
payable
|
|
|
|
|
|
|
(2,583)
|
Derivative financial
instruments
|
|
|
|
|
|
|
(193)
|
Tax
|
|
|
|
|
|
|
(347)
|
Employee benefits
|
|
|
|
|
|
|
(82)
|
Total liabilities
|
|
|
|
|
|
|
(5,305)
|
|
|
|
|
|
|
|
|
Capital expenditure
|
|
|
153
|
242
|
105
|
47
|
547
|
1. Adjusted to exclude amortisation and
adjusting items as presented in the income statement.
Year ended 30 April 2023
|
|
Note
|
Northern
Europe
£m
|
Southern
Europe
£m
|
Eastern
Europe
£m
|
North
America
£m
|
Total continuing operations
£m
|
External revenue
|
|
|
3,132
|
3,150
|
1,275
|
664
|
8,221
|
Adjusted EBITDA1
|
|
|
324
|
621
|
125
|
103
|
1,173
|
Depreciation
|
|
|
(112)
|
(120)
|
(49)
|
(31)
|
(312)
|
Adjusted operating
profit1
|
|
|
212
|
501
|
76
|
72
|
861
|
Unallocated items:
|
|
|
|
|
|
|
|
Amortisation
|
|
|
|
|
|
|
(113)
|
Adjusting items in operating
profit
|
|
3
|
|
|
|
|
(15)
|
Total operating profit (continuing
operations)
|
|
|
|
|
733
|
Unallocated items:
|
|
|
|
|
|
|
|
Net financing costs
|
|
|
|
|
|
|
(74)
|
Share of profit of equity accounted
investments, net of tax
|
|
|
|
|
|
2
|
Profit before income tax
|
|
|
|
|
|
|
661
|
Income tax expense
|
|
|
|
|
|
|
(169)
|
Profit for the year (continuing
operations)
|
|
|
|
|
|
|
492
|
Analysis of total assets and total
liabilities
|
|
|
|
|
|
Segment assets
|
|
|
2,246
|
3,762
|
1,247
|
1,318
|
8,573
|
Unallocated items:
|
|
|
|
|
|
|
|
Equity accounted investments and
other investments
|
|
|
|
|
|
|
34
|
Derivative financial
instruments
|
|
|
|
|
|
|
319
|
Cash and cash equivalents
|
|
|
|
|
|
|
472
|
Tax
|
|
|
|
|
|
|
35
|
Employee benefits
|
|
|
|
|
|
|
24
|
Total assets
|
|
|
|
|
|
|
9,457
|
|
|
|
|
|
|
|
|
Segment liabilities
|
|
|
(1,249)
|
(910)
|
(282)
|
(119)
|
(2,560)
|
Unallocated items:
|
|
|
|
|
|
|
|
Borrowings, overdrafts and interest
payable
|
|
|
|
|
|
|
(1,936)
|
Derivative financial
instruments
|
|
|
|
|
|
|
(368)
|
Tax
|
|
|
|
|
|
|
(427)
|
Employee benefits
|
|
|
|
|
|
|
(79)
|
Total liabilities
|
|
|
|
|
|
|
(5,370)
|
|
|
|
|
|
|
|
|
Capital expenditure
|
|
|
134
|
266
|
109
|
36
|
545
|
1. Adjusted to exclude amortisation and
adjusting items as presented in the income statement.
Geographical areas
In presenting information by geographical area,
external revenue is based on the geographical location of
customers. Non-current assets are based on the geographical
location of assets and exclude investments, deferred tax assets,
derivative financial instruments and intangible assets (which are
monitored at the operating segment level, not at a country
level).
|
External revenue
|
Non-current assets
|
Capital expenditure
|
Continuing operations
|
2024
£m
|
2023
£m
|
2024
£m
|
2023
£m
|
2024
£m
|
2023
£m
|
UK
|
1,071
|
1,300
|
525
|
508
|
70
|
67
|
France
|
1,009
|
1,203
|
518
|
491
|
76
|
79
|
Iberia
|
798
|
970
|
702
|
673
|
94
|
81
|
Germany
|
631
|
763
|
429
|
420
|
52
|
38
|
Italy
|
720
|
972
|
473
|
426
|
72
|
106
|
USA
|
591
|
671
|
410
|
390
|
47
|
36
|
Rest of the World
|
2,002
|
2,342
|
938
|
857
|
136
|
138
|
|
6,822
|
8,221
|
3,995
|
3,765
|
547
|
545
|
3. Adjusting items
Items are presented as adjusting in the
financial statements where they are significant items of financial
performance that the Directors consider should be separately
disclosed to assist in the understanding of the trading and
financial results of the Group. Such items include business
disposals, restructuring and acquisition related and integration
costs, and impairments.
Continuing operations
|
2024
£m
|
2023
£m
|
Acquisition related costs
|
(9)
|
(15)
|
Gain on acquisitions and
divestments
|
10
|
-
|
Net gain/(loss) on acquisitions and
divestments
|
1
|
(15)
|
Total pre-tax adjusting items
(recognised in operating profit)
|
1
|
(15)
|
Current tax credit on adjusting
items
|
1
|
3
|
Total post-tax adjusting
items
|
2
|
(12)
|
2023/24
In April 2024, the Group sold its previously
fully written-down Ukrainian associate, RKTK, for £10m. £5m was
received by 30 April 2024 and a further £5m will be received in the
next financial year. This resulted in a £10m gain on divestment in
the year ended 30 April 2024.
The Group incurred £3m of acquisition costs in
the year-end 30 April 2024 relating to the recommended all-share
offer from International Paper and a further £6m of other related
costs.
2022/23
On 1 September 2022 the put option for the final
10% stake in Interstate Resources crystallised. This has resulted
in additional costs
in relation to performance conditions which have been met by the
business and the costs of hedging the pending payment of the
US dollar liability.
The current tax credit on adjusting items of £3m
for the year ended 30 April 2023 is the tax effect at the local
applicable tax rate of adjusting items that are subject to tax.
This excludes non-tax-deductible deal related advisory fees in
relation to acquisitions and divestments.
Adjusting items from discontinued operations
comprise the gain on the settlement of certain costs and
obligations arising from the disposal of the Plastics
division.
4. Employee benefits
|
2024
£m
|
2023
£m
|
Employee benefit deficit at
beginning of the year
|
(55)
|
(86)
|
Divestments
|
-
|
-
|
Expense recognised in operating
profit
|
(5)
|
(6)
|
Employment benefit net finance
expense
|
(1)
|
(1)
|
Employer contributions
|
21
|
23
|
Other payments and
contributions
|
8
|
9
|
Actuarial loss
|
(2)
|
11
|
Currency translation
|
2
|
(5)
|
Employee benefit deficit at 30
April
|
(32)
|
(55)
|
Deferred tax asset
|
7
|
14
|
Net employee benefit deficit at end
of the year
|
(25)
|
(41)
|
|
|
|
The table above is the aggregate net value of
all Group employee benefit schemes, including both overseas and UK
schemes.
The Group's principal funded defined benefit
scheme, the DS Smith Group Pension scheme, is in the UK and is now
closed to future accrual.
This scheme has a surplus of £49m and an asset
has been recognised on the Group's balance sheet in respect of
this.
The Group also operates various local
post-retirement arrangements for overseas operations,
pre-retirement benefits and long service awards, and a small UK
unfunded scheme.
The net position of all schemes is shown
above.
5. Finance income and costs
Continuing operations
|
2024
£m
|
2023
£m
|
Interest income from financial
assets
|
(14)
|
(2)
|
Finance income
|
(14)
|
(2)
|
Interest on borrowings and
overdrafts
|
103
|
49
|
Interest on lease
liabilities
|
12
|
11
|
Other
|
1
|
15
|
Finance costs
|
116
|
75
|
Borrowing costs capitalised on qualifying assets
in the year ended 30 April 2024 was £1m (2022/23: £nil). Borrowing
costs were capitalised at a weighted average rate of
4.7%.
6. Income tax expense
|
2024
£m
|
2023
£m
|
Current tax expense
|
|
|
Current year
|
(158)
|
(206)
|
Adjustment in respect of prior
years
|
25
|
32
|
|
(133)
|
(174)
|
Deferred tax
credit/(charge)
|
|
|
Origination and reversal of
temporary differences
|
29
|
14
|
Change in tax rates
|
(3)
|
(4)
|
Recognition of previously
unrecognised deferred tax assets
|
4
|
1
|
Adjustment in respect of prior
years
|
(16)
|
(9)
|
|
14
|
2
|
Total income tax expense before
adjusting items
|
(119)
|
(172)
|
Current tax credit on adjusting
items (note 3)
|
1
|
3
|
Total income tax expense in the
income statement from continuing operations
|
(118)
|
(169)
|
Total income tax expense in the
income statement from discontinued operations
|
-
|
-
|
Total income tax expense in the
income statement - total Group
|
(118)
|
(169)
|
The tax credit on amortisation was £26m
(2022/23: £25m).
The reconciliation of the actual tax charge to
the domestic corporation tax rate is as follows:
|
2024
£m
|
2023
£m
|
Profit before income tax on
continuing operations
|
503
|
661
|
Profit before income tax on
discontinued operations
|
-
|
11
|
Share of profit of equity accounted
investments, net of tax
|
(2)
|
(2)
|
Profit before tax and share of
profit of equity accounted investments, net of tax
|
501
|
670
|
|
|
|
Income tax at the UK corporation tax
rate of 25.0% (2022/23: 19.5%)
|
(125)
|
(131)
|
Effect of additional taxes and tax
rates in overseas jurisdictions
|
(1)
|
(47)
|
Impact of tax credits
|
9
|
23
|
Non-deductible expenses
|
(13)
|
(34)
|
Non-taxable income
|
6
|
2
|
Recognition of previously
unrecognised deferred tax assets
|
4
|
1
|
Deferred tax not
recognised
|
(4)
|
(2)
|
Adjustment in respect of prior
years
|
9
|
23
|
Effect of change in corporation tax
rates
|
(3)
|
(4)
|
Income tax expense - total
Group
|
(118)
|
(169)
|
The Group's effective tax rate, excluding
amortisation, adjusting items and share of result from equity
accounted investments, was 24.2% (2022/23: 25.0%).
The Finance Act 2021 included a 6% increase in
the main UK corporation tax rate to 25% from 1 April 2023, which
was substantially enacted on 10 June 2021. The tax reconciliation
for the year ended 30 April 2024 is therefore presented at the 25%
rate and the effects of additional taxes and tax rates in overseas
jurisdictions is lower than for 2022/23.
Tax on other comprehensive income and equity
|
Gross
2024
£m
|
Tax credit/
(charge)
2024
£m
|
Net
2024
£m
|
Gross
2023
£m
|
Tax credit/
(charge)
2023
£m
|
Net
2023
£m
|
Actuarial (loss)/gain on employee
benefits
|
(2)
|
1
|
(1)
|
11
|
(2)
|
9
|
Foreign currency translation
differences
|
(147)
|
-
|
(147)
|
194
|
-
|
194
|
Reclassification to income statement
on asset write down
|
-
|
-
|
-
|
(3)
|
-
|
(3)
|
Movements in cash flow
hedges
|
(211)
|
41
|
(170)
|
(645)
|
149
|
(496)
|
Movement in net investment
hedge
|
41
|
2
|
43
|
(74)
|
-
|
(74)
|
Other comprehensive (expense)/
income for the year
|
(319)
|
44
|
(275)
|
(517)
|
147
|
(370)
|
Issue of share capital
|
7
|
-
|
7
|
4
|
-
|
4
|
Employee share trust
|
(4)
|
-
|
(4)
|
(8)
|
-
|
(8)
|
Share-based payments
|
(2)
|
(2)
|
(4)
|
15
|
(2)
|
13
|
Dividends paid to Group
shareholders
|
(247)
|
-
|
(247)
|
(289)
|
-
|
(289)
|
Other comprehensive (expense)/income
and changes in
equity
|
(565)
|
42
|
(523)
|
(795)
|
145
|
(650)
|
The realisation of underlying reserves is
conducted in such a way to ensure there is no material tax
consequence.
7. Earnings per share
Basic earnings per share from continuing
operations
|
2024
|
2023
|
Profit from continuing operations
attributable to ordinary shareholders
|
£385m
|
£492m
|
Weighted average number of ordinary
shares
|
1,374m
|
1,376m
|
Basic earnings per share
|
28.0p
|
35.8p
|
Diluted earnings per share from continuing
operations
|
2024
|
2023
|
Profit from continuing operations
attributable to ordinary shareholders
|
£385m
|
£492m
|
Weighted average number of ordinary
shares
|
1,374m
|
1,376m
|
Potentially dilutive shares issuable
under share-based payment arrangements
|
7m
|
10m
|
Weighted average number of ordinary
shares (diluted)
|
1,381m
|
1,386m
|
Diluted earnings per
share
|
27.9p
|
35.5p
|
The number of shares excludes the weighted
average number of the Company's own shares held as treasury shares
during the year of 3m (2022/23: 2m).
|
2024
|
2023
|
|
Basic
pence per share
|
Diluted
pence per share
|
Basic
pence per share
|
Diluted
pence per share
|
Earnings per share from continuing
operations
|
28.0p
|
27.9p
|
35.8p
|
35.5p
|
Earnings per share from discontinued
operations
|
-
|
-
|
0.8p
|
0.8p
|
Earnings per share from continuing
and discontinued operations
|
28.0p
|
27.9p
|
36.6p
|
36.3p
|
Adjusted earnings per share from continuing
operations
Adjusted earnings per share is a key performance
measure for management long-term remuneration and is widely used by
the Group's shareholders. Adjusted earnings is calculated by adding
back the post-tax effects of both amortisation and adjusting
items.
Further detail about the use of non-GAAP
performance measures, including details of why amortisation is
excluded, is given in note 14.
A reconciliation of basic to adjusted earnings
per share is as follows:
|
2024
|
2023
|
|
£m
|
Basic
pence
per share
|
Diluted
pence
per share
|
£m
|
Basic
pence
per share
|
Diluted
pence
per share
|
Basic earnings
|
385
|
28.0p
|
27.9p
|
492
|
35.8p
|
35.5p
|
Add back:
|
|
|
|
|
|
|
Amortisation of intangible
assets
|
98
|
7.1p
|
7.0p
|
113
|
8.1p
|
8.1p
|
Tax credit on
amortisation
|
(26)
|
(1.9p)
|
(1.9p)
|
(25)
|
(1.8p)
|
(1.8p)
|
Adjusting items, before
tax
|
(1)
|
(0.1p)
|
(0.1p)
|
15
|
1.1p
|
1.1p
|
Tax on adjusting items and adjusting
tax items
|
(1)
|
-
|
-
|
(3)
|
(0.2p)
|
(0.2p)
|
Adjusted earnings
|
455
|
33.1p
|
32.9p
|
592
|
43.0p
|
42.7p
|
8. Dividends proposed and paid
|
2024
|
2023
|
|
Pence
per share
|
£m
|
Pence
per share
|
£m
|
2022/23 interim dividend -
paid
|
-
|
-
|
6.0p
|
83
|
2022/23 final dividend -
paid
|
-
|
-
|
12.0p
|
165
|
2023/24 interim dividend - declared
and paid
|
6.0p
|
82
|
-
|
-
|
2023/24 final dividend -
proposed
|
12.0p
|
166
|
-
|
-
|
|
2024
£m
|
2023
£m
|
Paid during the year
|
247
|
289
|
The final 2022/23 dividend of 12p per share and
the 2023/24 interim dividend of 6.0p per share were paid during the
year.
9. Net debt
The components of net debt and movement during
the year are as follows:
|
|
At 30 April
2023
£m
|
Continuing operations
cash flow
£m
|
Foreign exchange, fair value and
non-cash
movements
£m
|
At 30 April
2024
£m
|
Cash and cash equivalents
|
|
472
|
44
|
(17)
|
499
|
Overdrafts
|
|
(104)
|
14
|
1
|
(89)
|
Net cash and cash
equivalents
|
|
368
|
58
|
(16)
|
410
|
Other investments - restricted
cash
|
|
6
|
1
|
-
|
7
|
Other deposits
|
|
30
|
(1)
|
-
|
29
|
Borrowings - after one
year
|
|
(1,742)
|
(738)
|
440
|
(2,040)
|
Borrowings - within one
year
|
|
(74)
|
70
|
(393)
|
(397)
|
Lease liabilities
|
|
(224)
|
72
|
(87)
|
(239)
|
Derivative financial
instruments
|
|
|
|
|
|
Assets
|
|
-
|
2
|
(2)
|
-
|
Liabilities
|
|
-
|
-
|
-
|
-
|
|
|
(2,004)
|
(594)
|
(42)
|
(2,640)
|
Net debt - reported basis
|
|
(1,636)
|
(536)
|
(58)
|
(2,230)
|
IFRS 16 lease liabilities
|
|
220
|
|
|
236
|
Net debt excluding IFRS 16
liabilities
|
|
(1,416)
|
|
|
(1,994)
|
Net debt is a non-GAAP measure not defined by
IFRS. While the Group has included lease liabilities after
transition to IFRS 16 Leases within total
lease liabilities (in addition to arrangements previously
classified as finance leases under IAS 17), IFRS 16 liabilities are
currently excluded from the definition of net debt as set out in
the Group's banking covenant requirements.
Further detail on the use of non-GAAP measures
and a reconciliation showing the calculation of adjusted net debt,
as defined in the Group's banking covenants, is included in note
14.
Derivative financial instruments above relate to
forward foreign exchange contracts and cross-currency swaps used to
hedge the Group's borrowings and the net assets of foreign
operations. The difference between the amounts shown above and the
total derivative financial instrument assets and liabilities in the
consolidated statement of financial position relates to derivative
financial instruments that hedge forecast foreign currency
transactions and the Group's purchases of energy.
Non-cash movements relate to amortisation of
fees incurred on debt issuance and new leases.
Other deposits are included, as these short-term
receivables have the characteristics of net debt.
10. Cash generated from operations
Continuing operations
|
2024
£m
|
2023
£m
|
Profit for the year
|
385
|
492
|
Adjustments for:
|
|
|
Amortisation of intangible assets;
acquisitions and divestments
|
97
|
128
|
Cash outflow for adjusting
items
|
(11)
|
(14)
|
Depreciation
|
323
|
312
|
(Profit)/loss on sale of non-current
assets
|
(9)
|
7
|
Share of profit of equity accounted
investments, net of tax
|
(2)
|
(2)
|
Employment benefit net finance
expense
|
1
|
1
|
Share-based payments
|
(2)
|
15
|
Finance income
|
(14)
|
(2)
|
Finance costs
|
116
|
75
|
Other non-cash items
|
(13)
|
24
|
Income tax expense
|
118
|
169
|
Change in provisions
|
7
|
19
|
Change in employee
benefits
|
(24)
|
(25)
|
Cash generation before working
capital movement
|
972
|
1,199
|
Changes in:
|
|
|
Inventories
|
6
|
99
|
Trade and other
receivables
|
88
|
15
|
Trade and other payables
|
(511)
|
(235)
|
Working capital movement
|
(417)
|
(121)
|
Cash generated from continuing
operations
|
555
|
1,078
|
11. Reconciliation of net cash flow to movement in net
debt
|
2024
£m
|
2023
£m
|
Profit for the year
|
385
|
492
|
Income tax expense
|
118
|
169
|
Share of profit of equity accounted
investments, net of tax
|
(2)
|
(2)
|
Net financing costs
|
103
|
74
|
Amortisation of intangible assets;
acquisitions and divestments
|
97
|
128
|
Adjusted operating profit
|
701
|
861
|
Depreciation
|
323
|
312
|
Adjusted EBITDA
|
1,024
|
1,173
|
Working capital movement
|
(417)
|
(121)
|
Change in provisions
|
7
|
19
|
Change in employee
benefits
|
(24)
|
(25)
|
Other
|
(24)
|
46
|
Cash generated from operations
before adjusting cash items
|
566
|
1,092
|
Capital expenditure
|
(547)
|
(545)
|
Proceeds from sale of property,
plant and equipment and other investments
|
41
|
19
|
Tax paid
|
(169)
|
(136)
|
Net interest paid
|
(66)
|
(76)
|
Free cash flow
|
(175)
|
354
|
Cash outflow for adjusting
items
|
(11)
|
(14)
|
Dividends paid
|
(247)
|
(289)
|
Acquisition of subsidiary
businesses, net of cash and cash equivalents
|
(113)
|
-
|
Divestment of equity accounted
investments
|
5
|
-
|
Other
|
(2)
|
(2)
|
Net cash flow
|
(543)
|
49
|
Proceeds from issue of share
capital
|
7
|
4
|
Net movement on debt
|
(536)
|
53
|
Foreign exchange, fair value and
other non-cash movements (note 10)
|
(58)
|
(205)
|
Net debt movement - continuing
operations
|
(594)
|
(152)
|
Opening net debt
|
(1,636)
|
(1,484)
|
Closing net debt - reported
basis
|
(2,230)
|
(1,636)
|
Adjusted operating profit, adjusted EBITDA,
free cash flow, and net debt are non-GAAP measures not defined by
IFRS. Further detail on the use of non-GAAP measures is included in
note 14.
12. Financial instruments
The Group's activities expose the Group to a
number of key risks which have the potential to affect its ability
to achieve its business objectives. A summary of the Group's key
financial risks and the policies and objectives in place to manage
these risks is set out in the Financial review and Principal risk
sections of the Strategic Report.
The derivative financial instruments set out in
this note have been entered into in line with the Group's risk
management objectives. The Group's treasury policy prohibits
entering into speculative transactions.
(a) Carrying amounts and fair values of financial assets
and liabilities
Set out below is the accounting classification
of the carrying amounts and fair values of all of the Group's
financial assets and liabilities:
|
|
|
2024
|
2023
|
|
|
Category
|
Carrying amount
£m
|
Fair value
£m
|
Carrying amount
£m
|
Fair value
£m
|
Financial assets
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
Amortised cost
|
499
|
499
|
472
|
472
|
Restricted cash
|
|
Amortised cost
|
6
|
6
|
7
|
7
|
Other investments
|
|
Fair value through other
comprehensive income
|
11
|
11
|
10
|
10
|
Trade and other
receivables
|
|
Amortised cost
|
1,134
|
1,134
|
1,257
|
1,257
|
Derivative financial
instruments
|
|
Fair value - hedging
instruments
|
79
|
79
|
319
|
319
|
Total financial assets
|
|
|
1,729
|
1,729
|
2,065
|
2,065
|
Financial liabilities
|
|
|
|
|
|
|
Trade and other payables
|
|
Amortised cost, except as detailed
below
|
(1,850)
|
(1,850)
|
(2,287)
|
(2,287)
|
Bank and other loans
|
|
Amortised cost
|
(9)
|
(9)
|
(341)
|
(341)
|
Commercial paper
|
|
Amortised cost
|
-
|
-
|
(24)
|
(24)
|
Medium-term notes and other
fixed-term debt
|
|
Amortised cost
|
(2,428)
|
(2,382)
|
(1,451)
|
(1,384)
|
Lease liabilities
|
|
Amortised cost
|
(239)
|
(239)
|
(224)
|
(224)
|
Bank overdrafts
|
|
Amortised cost
|
(89)
|
(89)
|
(104)
|
(104)
|
Derivative financial
instruments
|
|
Fair value - hedging
instruments
|
(193)
|
(193)
|
(368)
|
(368)
|
Total financial
liabilities
|
|
|
(4,808)
|
(4,762)
|
(4,799)
|
(4,732)
|
The fair value is the price that would be
received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement
date. For financial instruments carried at fair value, market
prices or rates are used to determine fair value where an active
market exists. The Group uses forward prices for valuing forward
foreign exchange and commodity contracts and uses valuation models
with present value calculations based on market yield curves to
value fixed rate borrowings. All derivative financial
instruments are shown at fair value in the consolidated statement
of financial position.
The Group's medium-term notes and other
fixed-term debt are in effective cash flow and net investment
hedges. The fair values of
financial assets and liabilities which bear floating rates of
interest or are short term in nature are estimated to be equivalent
to their carrying amounts.
The Group's financial assets and financial
liabilities are categorised within the fair value hierarchy that
reflects the significance of the inputs used in making the
assessments. The majority of the Group's financial instruments are
Level 2 financial instruments in accordance with the fair value
hierarchy, meaning although the instruments are not traded in an
active market, inputs to fair value are observable for the asset
and liability, either directly (i.e. quoted market prices) or
indirectly (i.e. derived from prices). The Group's medium-term
notes are Level 1 financial instruments, as the notes are listed on
the Luxembourg Stock Exchange. Other investments are Level 3
financial instruments. The fair value of other investments is
derived from fair value calculations based on their cash
flows.
13. Acquisitions and divestments
(a) 2023/24
On 29 March 2024, the Group completed the
acquisition of Bosis doo, a Serbia-based packaging company, for
£17m, net of cash and cash equivalents..
In April 2024, the Group sold its previously
fully written-down Ukrainian associate, RKTK, for £10m. £5m was
received by 30 April 2024 and a further £5m will be received in the
next financial year. This resulted in a £10m gain on divestment in
the year ended 30 April 2024.
2022/23
The crystallisation of the put option for the
final 10% stake in Interstate Resources occurred during the
financial year. Additional costs as a result of the business
meeting performance obligations were recognised together with the
costs of hedging the dollar payment of the liability, the latter of
which will continue until the payment is made. These costs of £15m
have been taken to adjusting items; refer to note 3 for further
details.
(b) Plastics division
On 27 February 2020, the sale of the Group's
Plastics division to Olympus Partners and its affiliate Liqui-Box
Holdings was completed.
Plastics principally comprised flexible
packaging and dispensing solutions, extruded and injection moulded
products and foam products.
The Plastics segment has been
classified as a discontinued operation. The consolidated income
statement
presents the Plastics segment as a discontinued
operation with a single line amount of profit from discontinued
operation, net of tax. The consolidated statement of cash
flows presents a single amount of net cash flow from discontinued
operations.
Consolidated income statement - discontinued
operations
|
Year ended
30 April 2024
£m
|
Year ended
30 April 2023
£m
|
Revenue
|
-
|
-
|
Operating costs
|
-
|
-
|
Operating profit before
amortisation and adjusting
items
|
-
|
-
|
Amortisation of intangible
assets
|
-
|
-
|
Profit on disposal before
tax
|
-
|
-
|
Other pre-tax adjusting
items
|
-
|
11
|
Net finance cost
|
-
|
-
|
Profit before income tax
|
-
|
11
|
Income tax
credit/(expense)
|
-
|
-
|
Profit for the year from
discontinued operations
|
-
|
11
|
Settlement of certain costs and obligations
arising from the disposal of the Plastics division in the year
ended 30 April 2023 resulted in a gain in adjusting items in profit
from discontinued operations of £11m.
Basic earnings per share from discontinued
operations
|
2024
|
2023
|
Profit from discontinued operations
attributable to ordinary shareholders
|
-
|
£11m
|
Weighted average number of ordinary
shares
|
1,374m
|
1,376m
|
Basic earnings per share
|
-
|
0.8p
|
Diluted earnings per share from discontinued
operations
|
2024
|
2023
|
Profit from discontinued operations
attributable to ordinary shareholders
|
-
|
£11m
|
Weighted average number of ordinary
shares
|
1,374m
|
1,376m
|
Potentially dilutive shares issuable
under share-based payment arrangement
|
7m
|
10m
|
Weighted average number of ordinary
shares (diluted)
|
1,381m
|
1,386m
|
Diluted earnings per
share
|
-
|
0.8p
|
The number of shares excludes the weighted
average number of the Company's own shares held as treasury shares
during the year of 3m (2022/23: 2m).
Adjusted earnings per share from discontinued
operations
Further detail about the use of non-GAAP
performance measures is given in note 14.
A reconciliation of basic to adjusted earnings
per share from discontinued operations is as follows:
|
2024
|
2023
|
|
£m
|
Basic -
pence
per share
|
Diluted -
pence
per share
|
£m
|
Basic -
pence
per share
|
Diluted -
pence
per share
|
Basic earnings from discontinued
operations
|
-
|
-
|
-
|
11
|
0.8p
|
0.8p
|
Add back:
|
|
|
|
|
|
|
Adjusting items, before
tax
|
-
|
-
|
-
|
(11)
|
(0.8p)
|
(0.8p)
|
Adjusted earnings from discontinued
operations
|
-
|
-
|
-
|
-
|
-
|
-
|
Other 2023/24 acquisitions and
divestments
The Group incurred £3m (2022/23: £nil) of
acquisition costs in the year ended 30 April 2024 relating to the
recommended all-share offer from International Paper and a further
£6m (2022/23: £nil) of other related costs.
14. Non-GAAP performance measures
The Group presents reported and adjusted
financial information in order to provide shareholders with
additional information to further understand the Group's
operational performance and financial position.
The principal adjustments to financial
information are made to exclude the effects of adjusting items
(refer to note 3) and amortisation.
Total reported financial information represents
the Group's overall performance and financial position, but can
contain significant unusual or non-operational items that may
obscure understanding of the key trends and position. These unusual
or non-operational items include business disposals, restructuring
and project costs, acquisition-related and integration costs, and
impairments. Restructuring items treated as adjusting items are
major programmes usually spanning more than one year, with uneven
impact on the profit and loss for those years affected. Other
adjusting items, such as business disposals, impairments,
integration and acquisition costs, are by nature either highly
variable or can also have a similar distorting effect. Therefore,
the Directors consider that presenting non-GAAP measures which
exclude adjusting items enables comparability of the recurring core
business, complementing the IFRS measures presented.
Amortisation relates primarily to
customer contracts and relationships arising from or as a result of
business combinations. Significant costs
are incurred in maintaining, developing and increasing the value of
such intangibles, costs which are charged in determining adjusted
profit. Exclusion of amortisation remedies this double count as
well as, in the case of customer contracts and relationships,
providing comparability over the accounting treatment of customer
contracts and relationships arising from the acquisition of
businesses and those generated internally.
The Group's key non-GAAP measures are used both
internally and externally to evaluate business performance against
the Group's KPIs and banking and debt covenants, as a key
constituent of the Group's planning process, as well as comprising
targets against which compensation is determined.
Certain non-GAAP performance measures can be,
and are, reconciled to information presented in the financial
statements. Other financial key performance measures are
calculated using information which is not presented in the
financial statements and is based on, for example, average 12-month
balances or average exchange rates.
Unlike other of the Group's non-GAAP performance
measures, net debt and net debt/EBITDA remain calculated under the
previous standard, IAS 17 Leases, because they are calculated in accordance
with the Group's banking covenant requirements which remain on the
previous GAAP basis. As such, for net debt and net debt/EBITDA, the
reconciliation for the non-GAAP performance measure below has been
expanded to show the calculation to return the non-GAAP
performance measure to the IAS 17 basis.
Key non-GAAP performance measures
The key non-GAAP performance measures used by
the Group and their calculation methods are as follows:
Adjusted operating profit
Adjusted operating profit is operating profit
excluding the pre-tax effects of both amortisation and adjusting
items. Adjusting items include business divestment gains and
losses, restructuring and acquisition-related and integration costs
and impairments.
A reconciliation between reported and adjusted
operating profit is set out on the face of the consolidated income
statement.
Operating profit before adjusting items
A reconciliation between operating profit and
operating profit before adjusting items is set out on the face of
the consolidated income statement.
Other similar profit measures before adjusting
items are quoted, such as profit before income tax and adjusting
items, and are directly derived from the consolidated income
statement, from which they can be directly reconciled.
Adjusted EBITDA
Earnings before interest, tax,
depreciation and amortisation (Adjusted EBITDA) is adjusted
operating profit excluding depreciation.
A reconciliation from adjusted operating profit
to adjusted EBITDA is provided in note 11.
Adjusted earnings per share
Adjusted earnings per share is basic earnings
per share adjusted to exclude the post-tax effects of adjusting
items and amortisation. Adjusted earnings per share is
a key performance measure for management long-term remuneration and
is widely used by the Group's shareholders.
A reconciliation between basic and adjusted
earnings per share is provided in note 7.
Return on sales
Return on sales is adjusted operating profit
measured as a percentage of revenue. Return on sales is used to
measure the value delivered to customers and the Group's ability to
charge for that value.
|
2024
£m
|
2023
£m
|
Adjusted operating profit
|
701
|
861
|
Revenue
|
6,822
|
8,221
|
Return on sales
|
10.3%
|
10.5%
|
Adjusted return on average capital employed
(ROACE)
ROACE is the last 12 months' adjusted operating
profit as a percentage of the average monthly capital employed over
the previous 12-month period. Capital employed is the sum of
property, plant and equipment, right-of-use assets, goodwill and
intangible assets, working capital, capital debtors/creditors,
provisions, biological assets and assets/liabilities held for
sale.
|
2024
£m
|
2023
£m
|
Capital employed at 30
April
|
6,636
|
6,203
|
Currency inter-month and
acquisition/divestment movements
|
(79)
|
(194)
|
Last 12 months' average capital
employed
|
6,557
|
6,009
|
Last 12 months' adjusted operating
profit
|
701
|
861
|
Adjusted return on average capital
employed
|
10.7%
|
14.3%
|
Net debt and net debt/EBITDA
Net debt is the measure by which the Group
assesses its level of overall indebtedness within its financial
position. The components of net debt as they reconcile to the
primary financial statements and notes to the accounts are
disclosed in note 9.
Net debt/EBITDA is the ratio of net debt to
adjusted EBITDA, calculated in accordance with the Group's banking
covenant requirements.
Net debt/EBITDA is considered a key measure of
balance sheet strength and financial stability by which the Group
assesses its financial position.
The Group's banking covenant requirements
currently exclude IFRS 16 liabilities from the definition of net
debt, as well as requiring that EBITDA is calculated before the
effects of IFRS 16, so an adjustment to the previous IAS 17 basis
is made in the calculation.
In calculating the ratio, net debt is stated at
average rates as opposed to closing rates, and adjusted EBITDA is
adjusted operating profit before depreciation from the previous 12
month period adjusted for the full year effect of acquisitions and
divestments in the period, and to adjust to an IAS 17
basis.
|
2024
£m
|
2023
£m
|
Net debt - reported basis (see note
9)
|
2,230
|
1,636
|
IFRS 16 lease liabilities (see note
9)
|
(236)
|
(220)
|
Adjustment to average
rate
|
7
|
(17)
|
Net debt - adjusted basis
|
2,001
|
1,399
|
Adjusted EBITDA - last 12 months'
reported basis (continuing operations)
|
1,024
|
1,173
|
Adjust to IAS 17 basis
|
(85)
|
(85)
|
Acquisition and divestment
effects
|
3
|
-
|
Adjusted EBITDA - banking covenant
basis
|
942
|
1,088
|
Net debt/EBITDA
|
2.1x
|
1.3x
|
Free cash flow
Free cash flow is the net movement on debt
before cash outflow for adjusting items, dividends paid,
acquisition and divestment of subsidiary businesses (including
borrowings acquired), and proceeds from issue of share
capital.
A reconciliation from Adjusted EBITDA to free
cash flow is set out in note 11.
Cash conversion
Cash conversion is free cash flow, as defined
above, adjusted to exclude tax, net interest, growth capital
expenditure and pension payments as a percentage of adjusted
operating profit and can be derived directly from note 14, other
than growth capital expenditure, which is capital expenditure
necessary for the development or expansion of the business as
follows:
|
2024
£m
|
2023
£m
|
Growth capital
expenditure
|
186
|
275
|
Non-growth capital
expenditure
|
361
|
270
|
Total capital expenditure (note
11)
|
547
|
545
|
Free cash flow (note 11)
|
(175)
|
354
|
Tax paid (note 11)
|
169
|
136
|
Net interest paid (note
11)
|
66
|
76
|
Growth capital
expenditure
|
186
|
275
|
Change in employee benefits (note
11)
|
24
|
25
|
Adjusted free cash flow
|
270
|
866
|
Adjusted operating profit
|
701
|
861
|
Cash conversion
|
39%
|
101%
|
Average working capital to sales
Average working capital to sales measures the
level of investment the Group makes in working capital to conduct
its operations. It is measured by comparing the monthly working
capital balances for the previous 12 months as a percentage of
revenue over the same period. Working capital is the sum of
inventories, trade and other receivables, and trade and other
payables, excluding capital and acquisition and divestment-related
debtors and creditors.
|
2024
£m
|
2023
£m
|
Inventories
|
591
|
619
|
Trade and other
receivables
|
1,099
|
1,211
|
Trade and other payables
|
(1,696)
|
(2,105)
|
Inter-month movements and exclusion
of capital and acquisition and divestment-related items
|
80
|
36
|
Last 12 months' average working
capital
|
74
|
(239)
|
Last 12 months' revenue
|
6,822
|
8,221
|
Average working capital to
sales
|
1.1%
|
(2.9%)
|
Constant currency and organic growth
The Group presents commentary on both reported
and constant currency revenue and adjusted operating profit
comparatives in order to explain the impact of exchange rates
on the Group's key income statement items. Constant currency
comparatives recalculate the prior year revenue and adjusted
operating profit as if they had been generated using the current
year exchange rates. In addition, the Group then separates the
incremental effects of acquisitions and disposals made in the
current year, and the incremental effects of acquisitions and
disposals made in the previous year, to determine underlying
organic growth. The table below shows the calculations:
|
Revenue
£m
|
Adjusted operating profit
£m
|
|
Reported basis - comparative year
ended 30 April 2023
|
8,221
|
861
|
|
Currency effects
|
(84)
|
(11)
|
|
Constant currency basis -
comparative year ended 30 April 2023
|
8,137
|
850
|
|
|
|
|
|
Organic growth
|
(1,315)
|
(149)
|
|
Reported basis - year ended 30 April
2024
|
6,822
|
701
|
|
|
|
Return on sales - comparative year
ended April 2023 - constant currency basis
|
10.4%
|
|
£m
|
Reported profit before tax
comparative year ended 30 April 2023
|
661
|
Currency effects
|
(10)
|
Constant currency profit before tax
comparative year ended 30 April 2023
|
651
|
|
|
Basic earnings per share from
continuing operations for the comparative year ended 30 April 2023
- constant currency basis
|
£m
|
Profit from continuing
operations
|
492
|
Currency effects
|
(9)
|
|
483
|
Weighted average number of ordinary
shares
|
1,376m
|
Basic earnings per share - constant
currency basis
|
35.1p
|
Constant currency and organic growth
continued
Adjusted earnings per share for the
comparative year ended 30 April 2023 - constant
currency basis
|
£m
|
Adjusted earnings
|
592
|
Currency effects
|
(10)
|
|
582
|
Weighted average number of ordinary
shares
|
1,376m
|
Adjusted earnings per share -
constant currency basis
|
42.3p
|
Dividend cover
Dividend cover is adjusted earnings per share
divided by the total dividend for the year.
|
2024
|
2023
|
Adjusted earnings per
share
|
33.1p
|
43.0p
|
Total dividend
|
18.0p
|
18.0p
|
Dividend cover
|
1.8x
|
2.4x
|
15. Subsequent events
On November 2018 the Group signed a
£1.4 billion five-year committed syndicated revolving credit
facility with its core banks. The second extension option was
exercised in November 2020. A further extension was agreed in June
2024, such that the new facility of £1.25 billion matures in
May 2027.
On 19 June 2024 the Group signed a 5 year €200m
loan facility with Bayerische LB, Commerzbank, IKB Deutsche
Industriebank Ag and Unicredit Bank.