June 20 (Reuters) - British paper and packaging firm DS Smith posted on Thursday a smaller-than-expected fall in its annual profit, and said it expects the second half of 2025 fiscal year to benefit from a spike in packaging prices.
After a surge in sales during pandemic lockdowns on the back of soaring e-commerce demand, packaging companies had to grapple with de-stocking by customers amid tough macroeconomic challenges and falling prices.
The London-listed DS Smith, which provides packaging, paper and recycling services to companies including Amazon and Unilever, said the positive trends in packaging volumes from the second half of last year have continued into the current financial year.
The company said its adjusted operating profit from continuing operations for the year ended April 30 fell 19% year-on-year to 701 million pounds ($639 million). Analysts on average, however, had only expected a profit of 654.2 million pounds, according to LSEG data.
The company, which in April agreed to a $7.20 billion all-share takeover by International Paper, said its annual like-for-like box volumes declined 2%.
Originally a UK-focused business, DS Smith now operates in more than 30 countries, with Europe being its biggest market. The company expanded into the United States in 2017 after buying a majority stake in Interstate Resources for $1.15 billion.
($1 = 0.7872 pounds) (Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Sherry Jacob-Phillips)
