Interim Results
Smith (DS) PLC
5 December 2001
5 December 2001
DS Smith Plc
Interim Results for the Half Year to 27 October 2001
Reasonable start to the year in challenging conditions
* Group turnover up 3.3% at £711.9m (£689.2m)
* Profit before tax, exceptional items and amortisation of intangibles
was £35.8m (£39.4m)
* Adjusted earnings per share of 7.7p (8.3p restated)
* Interim dividend unchanged at 2.8p per share
* Good performance from packaging operations despite poor UK market
* Office products impacted by lower sales in the UK and Ireland
* Tony Thorne appointed Group Chief Executive
Commenting on the half year results and outlook, Chairman Antony Hichens said:
'We have made a reasonable start to the year given the slowdown in the markets
in which we operate. The packaging business has performed well in demanding
trading conditions though the office products business made a disappointing
start in the UK and Ireland.
'The recession that is gripping the world economy makes it extremely difficult
to forecast trading conditions over the next few months so we are cautious
about the outlook for the balance of this year. However, we have entered this
downturn with strong market positions, an improving cost base and a healthy
balance sheet. This is enabling us to make attractively priced bolt-on
acquisitions whilst continuing the organic development of the Group.'
Enquiries
DS Smith Plc 020 7932 5000
Tony Thorne, Group Chief Executive
David Buttfield, Finance Director
Paul Froud, Investor Relations
Financial Dynamics 020 7269 7291
Richard Mountain/Robert Gurner
Interim results for the financial half year to 27 October 2001
HIGHLIGHTS
The Group has made a reasonable start to the year given the slowdown that has
occurred in our markets. The packaging business has performed well in
demanding trading conditions, slightly exceeding the same period last year.
By contrast the office products business made a disappointing start to the
year in the UK and Ireland.
Group turnover for the half year to 27 October 2001 increased by 3.3% to
£711.9 million from £689.2 million in the same period last year. Operating
profit before amortisation of intangibles was £41.9 million compared to £45.0
million and Group operating margins declined to 5.9% from 6.5%.
Profit before tax, exceptional items and amortisation of intangibles was £35.8
million compared to £39.4 million for the same period of last year. The
underlying effective tax rate was 30%. This compares to 31.7% for last year
which, together with earnings per share and gearing, has been restated for the
implementation of FRS19, the new standard on Deferred Tax. Earnings per share
before exceptional items and amortisation of intangibles were 7.7p compared
to 8.3p (restated) for the first half of last year.
Net borrowings rose to £255.0 million from £200.6 million at this time last
year. Gearing increased to 55.6% from 43.3% (restated), and the interest
cover remained strong at 7.0 times.
Expenditure on acquisitions in the first half amounted to £33.5 million
including acquired debt. Capital expenditure increased slightly to £24.5
million for the first half year and is expected to amount to around £70
million for the full year.
INTERIM DIVIDEND
The Board announces an unchanged interim dividend of 2.8p. This dividend will
be paid on 12 March 2002 to ordinary shareholders on the register at the close
of business on 18 January 2002.
PACKAGING
Total sales for the packaging business increased by 2.5% to £445.6 million.
Operating profit before amortisation of intangibles rose by 2.3% to £35.2
million and operating margins remained unchanged at 7.9% compared to the same
period last year. The return on capital employed was 11.7 % compared with
12.3 %.
Corrugated and Paper
The corrugated and paper segment of Packaging saw a small fall in sales from
£358.4 million to £351.7 million. Operating profit before amortisation of
intangibles slightly reduced to £29.2 million from £29.9 million but operating
margins remained unchanged at 8.3%.
European corrugated demand weakened as the year progressed, falling by 0.7% in
the first nine months of 2001. Once again the UK market experienced much
weaker demand, falling by 3.7% in the same period.
Waste paper prices fell during the first half of the calendar year before
steadying during the third quarter. More recently demand from the Far East
and low stocks in Europe have prompted some price increases. Corrugated case
material (CCM) prices have also declined since January, in line with the waste
paper price reductions. New CCM capacity coming on stream has not been
disruptive as it was largely offset by closures and downtime taken by major
producers. However, the recent weakening of demand across Europe may put
further pressure on CCM margins. Corrugated box plants have been reasonably
successful in holding their selling prices and have benefited from the fall in
CCM prices during the year, although margins still remain inadequate.
DS Smith Packaging
Against the background of a poor UK market DS Smith Packaging produced a good
performance. In addition to the benefit of falling CCM prices, profitability
improved as a result of continued efficiency gains across the division and
greater throughput in the conventional corrugated plants, especially at
Bristol and Fordham.
The decline in UK manufacturing continued to impact the division adversely.
The Tri-Wall heavy-duty business has been particularly affected by the
downturn in the engineering sector and our packaging plants in Scotland have
been badly hit by the closure of customers in the electronics market.
In September the division acquired, in a back to back deal with Mondi, 13
Danisco packaging units, based mainly in the south and west of the UK. These
businesses, acquired well below the valuation levels of recent acquisitions in
the industry, are already bringing benefits and the synergies resulting from
integration will be significant after initial reorganisation costs. In
particular, the Kettering sheet plant is a modern, well invested operation
focussing on the production of lightweight speciality board, a fast growing
segment of the market. This business will complement our existing Abbey
sheetfeeding business to create a stronger force in this sector.
The returns in the UK market are unsatisfactory. Nevertheless, the progress
made by the division in this challenging market is encouraging and should
continue.
Kaysersberg Packaging
The Group's continental European corrugated division, Kaysersberg Packaging,
experienced a slight fall in sales during the first half of the financial year
but achieved a small improvement in profitability.
Corrugated demand in France has turned negative with overall demand 1% down
for the first nine months of the calendar year and the situation in Germany is
broadly similar. The main corrugated plants in France saw turnover fall in
line with the market, although margins improved due to CCM price reductions.
The Kaysersberg paper board mill experienced a difficult start to the
financial year as selling prices suffered some erosion and market downtime was
taken. The mill's new combined heat and power plant became operational and
will help reduce both energy costs and greenhouse gas emissions.
In Italy, Toscana Ondulati continued to make excellent progress and the new
factory being built to produce lightweight corrugated packaging is on course
for start-up in the spring of next year. Our Polish operations have also
performed well, recording stronger profits and continuing to gain from recent
investment and production efficiencies. In Turkey our business made good
operational improvements but fell into loss because of the difficult economic
situation in that country.
The division's programme of performance improvement continues and should help
the businesses weather the slowdown in their markets.
St Regis Paper
St Regis has performed better than expected during the first half of the
financial year. Sales volumes have reduced slightly due to the slowdown in
demand in the UK and continental Europe. Selling prices have also fallen
during this period. However, lower waste paper prices, particularly during
the early part of the financial year, have helped to maintain margins. The
division also benefited from improving efficiencies, with Kemsley and Hollins
paper mills making significant productivity gains.
The specialist mills have struggled for some time against overseas competitors
but performance has slowly improved following some reorganisation, investment
and product development. Progress should continue.
The UK packaging waste regulations imposed higher targets for waste recovery
and recycling during the year. This resulted in higher PRN values which
helped to support packaging waste collection when waste prices declined in the
early part of the year. Severnside suffered a difficult start to the
financial year due to this fall in waste paper prices. In the past couple of
months prices have firmed as demand from overseas picked up, particularly from
the Far East.
The outlook for the second half of the financial year is clouded by the risk
that CCM prices may move down without a corresponding reduction in waste paper
prices.
Plastics
Turnover in the plastics business increased by 23% to £93.9 million from £76.2
million in the first half of last year. Operating profit before amortisation
of intangibles rose by 33% to £6.0 million compared with £4.5 million and
operating margins increased to 6.4% from 5.9%.
DS Smith Plastics enjoyed a strong start to the financial year and has made
good progress in most businesses. The division has kept tight control of
costs and has seen some benefit from polymer price reductions.
Three small, but strategically significant, acquisitions have taken place to
strengthen product ranges and extend geographic presence in certain markets.
In May Carton Plastico, a small extruded plastics packaging company based in
Madrid, was acquired which allows further development in the Iberian market.
The liquid packaging business, operating under the Rapak name, grew strongly
over the period. In November it further extended its market coverage with the
acquisition of a 50% interest in AEP's liquid packaging business in Australia
and New Zealand. Our liquid packaging operations are now better able to
service major multinational customers, and the recent deal also secures access
to valuable intellectual property. The division also recently acquired a
small plastic pallet manufacturing business which will be integrated into the
division's existing European reusable transit packaging operation.
The Kaysersberg extruded plastic product operation has suffered a downturn in
sales resulting from the slowdown in the European manufacturing sector, but
the Ducaplast heavy duty transit packaging business has been more robust with
substantially increased sales during the period. The dispensing tap business
also performed well in the half year while the DW Plastics crate business
benefited from its operation in the Dominican Republic.
The outlook for the second half of the year is for further growth in profit,
helped by lower polymer costs.
OFFICE PRODUCTS
Turnover in the office products segment for the first half of the financial
year increased 4.6% to £266.3 million from £254.6 million. Operating profit
reduced to £6.7 million from £10.6 million and operating margins were 2.5%
compared with 4.2%. Return on capital employed fell to 7.5% from 13.3%.
Wholesaling
Spicers sales were £241.4 million for the half year, an increase of 5.6% on
the same period last year. Operating profit fell from £10.3 million to £6.4
million. Operating margins declined to 2.7% from 4.5%.
Operating profit in the first half was expected to be lower than last year as
a result of start-up costs in Germany and Spain and the cost of developing
additional capacity in the UK and Ireland in anticipation of higher sales
growth. The expected growth in the UK and Ireland did not materialise, causing
a much greater fall in profitability than was forecast
As a result of a sharp slowdown since the summer, sales of the UK and Ireland
businesses fell 1% and 4% respectively. The operations were not immediately
able to adjust their cost base in line with the downturn. The businesses also
experienced a much higher level of bad debts as dealer customers suffered in
the deteriorating market conditions. The slowdown in the market and increased
pressure on prices looks set to continue. The focus of attention in the UK
and Ireland businesses now is to raise service levels, reduce costs and
improve operational efficiencies.
Spicers France recorded a good performance for the half year with sales growth
of 11%, despite the economic slowdown which has affected the French office
products market. In October Spicers bought a competitor, Plein Ciel, which
had been in administration. This is a significant acquisition, delivering a
strong brand and the opportunity to grow sales to the Plein Ciel dealer
network.
Sales growth in Spicers Germany remained strong at 28% for the first half, but
is lower than previous rates of growth, mainly reflecting the weakening of the
German economy. The second depot at Nuremberg has become fully operational
and has alleviated capacity constraints on the Hanover warehouse.
In Spain the business is preparing for launch in spring of 2002. Building
work on the first depot, in Barcelona, nears completion and a site is being
sought in Madrid.
Although the office products market is challenging we expect the division to
be on an improving trend in the second half.
Manufacturing
John Dickinson Stationery saw a small decline in sales, down 2.8% to £34.8
million from £35.8 million for the same period last year. Operating profit
remained unchanged at £0.3m, giving slightly increased operating margins of
0.9%.
John Dickinson Stationery continues to operate in difficult markets. Envelope
sales declined under sustained pressure from a high level of imports and
severe price competition, though some success in growing branded product sales
was achieved. The book and pad stationery business made some headway with an
improving product mix. John Dickinson Ledbury and Spicer Hallfield produced
reasonable performances though both suffered from the effects of a slowing UK
economy.
Although the division is profitable it has far to go to raise margins to an
acceptable level.
PEOPLE
Tony Thorne has been appointed Group Chief Executive with effect from today,
succeeding Peter Williams. Tony joined the Group as Chief Operating Officer
nearly a year ago. Peter Williams becomes Deputy Chairman and is expected to
retire from the Board at the next AGM in September of 2002.
OUTLOOK
The recession that is gripping the world economy makes it extremely difficult
to forecast trading conditions over the next few months so we are cautious
about the outlook for the balance of this year. However, we have entered this
downturn with strong market positions, an improving cost base and a healthy
balance sheet. This is enabling us to make attractively priced bolt-on
acquisitions whilst continuing the organic development of the Group.
Group profit and loss account
Half year Half year Year
ended ended Ended
27 October 28 October 28 April
2001 2000 2001
(unaudited) (unaudited)
(restated) (restated)
Note £m £m £m
Turnover 2 711.9 689.2 1399.1
Operating profit
Before amortisation of intangibles 2 41.9 45.0 84.9
Amortisation of intangibles (0.7) (0.4) (1.1)
Group operating profit 41.2 44.6 83.8
Share of losses of associated (0.1) (0.1) (0.2)
undertakings
Total operating profit 41.1 44.5 83.6
Exceptional loss on termination of 3 - (2.2) (4.3)
operations
Profit on ordinary activities before 41.1 42.3 79.3
interest
Net interest payable (6.0) (5.5) (12.5)
Profit on ordinary activities before
taxation
Before exceptional items and
amortisation of intangibles 35.8 39.4 72.2
Exceptional items and amortisation of (0.7) (2.6) (5.4)
intangibles
35.1 36.8 66.8
Tax on profit on ordinary activities 4
Tax on profit before exceptional items (10.7) (12.5) (22.9)
Exceptional - 0.7 1.2
(10.7) (11.8) (21.7)
Profit on ordinary activities after 24.4 25.0 45.1
taxation
Minority interests - equity (0.6) (0.4) (0.8)
Profit for the period 23.8 24.6 44.3
Dividends (9.0) (8.9) (28.2)
Retained profit for the period 14.8 15.7 16.1
Earnings per share:
Basic 5 7.4p 7.7p 13.8p
Diluted 5 7.4p 7.7p 13.8p
Adjusted 5 7.7p 8.3p 15.1p
Dividends per share 2.8p 2.8p 8.8p
The results for the six months ended 28 October 2000 and the year ended 28
April 2001 have been restated for the effects of applying FRS 19 'Deferred
Tax' (note 1).
Group statement of total recognised gains and losses
Half year Half year Year
ended ended Ended
27 October 28 October 28 April
2001 2000 2001
(unaudited) (unaudited)
(restated)(restated)
£m £m £m
Profit for the period 23.8 24.6 44.3
Exchange differences on foreign currency net
investments (2.2) 2.0 5.6
Total recognised gains and losses relating
to the period 21.6 26.6 49.9
Prior year adjustment (see below) (62.2) - -
Total recognised gains and losses since the
last financial statements (40.6) 26.6 49.9
The prior year adjustment arises from the implementation during the period of
the revised accounting policy for deferred tax provisions (note 1).
Group reconciliation of movements in shareholders' funds
Half year Half year Year
ended ended ended
27 October 28 October 28 April
2001 2000 2001
(unaudited) (unaudited)
(restated) (restated)
£m £m £m
Profit for the period 23.8 24.6 44.3
Dividends (9.0) (8.9) (28.2)
Retained profit for the period 14.8 15.7 16.1
Exchange differences on foreign currency
net investments (2.2) 2.0 5.6
Increase in shareholders' funds 12.6 17.7 21.7
Opening shareholders' funds (restated) 446.2 424.5 424.5
Closing shareholders' funds 458.8 442.2 446.2
The difference between reported and historical cost profits for the periods
reported above is not material.
Group balance sheet
At At At
27 October 28 October 28 April
2001 2000 2001
(unaudited) (unaudited)
(restated) (restated)
£m £m £m
Fixed assets 607.8 558.9 587.6
Current assets
Stocks 141.8 140.0 155.2
Debtors 362.6 339.8 334.6
Short term investments 17.9 15.7 19.3
Cash at bank and in hand 9.7 11.6 10.0
532.0 507.1 519.1
Creditors: amounts falling due
within one year
Trade and other creditors (290.5) (289.6) (334.0)
Borrowings (28.0) (19.6) (22.1)
Net current assets 213.5 197.9 163.0
Total assets less current liabilities 821.3 756.8 750.6
Creditors: amounts falling due
after more than one year
Borrowings (254.6) (208.3) (200.6)
Other (9.5) (8.1) (6.8)
Provisions for liabilities and charges (92.6) (93.8) (92.0)
464.6 446.6 451.2
Minority interests - equity (5.8) (4.4) (5.0)
Net assets 458.8 442.2 446.2
Capital and reserves
Called up share capital 32.1 32.1 32.1
Share premium account 188.0 188.0 188.0
Revaluation reserve 9.5 10.7 9.5
Profit and loss account 229.2 211.4 216.6
Shareholders' funds - equity 458.8 442.2 446.2
Gearing (net debt expressed as a percentage
of shareholders' funds) 55.6% 45.4% 43.3%
Group cash flow statement
Half year Half year Year
ended ended Ended
27 October 28 October 28
2001 2000 April
(unaudited) (unaudited) 2001
Note £m £m £m
Net cash inflow from operating activities 6 49.0 19.8 98.6
Returns on investments and servicing of (5.8) (5.9) (12.2)
finance
Taxation (16.5) 7.3 (3.0)
Capital expenditure and financial 7 (35.3) (27.8) (62.8)
investment
Acquisitions and disposals 9 (30.0) (8.3) (9.1)
Equity dividends paid (19.2) (18.6) (27.5)
Net cash outflow before use of liquid
resources and financing (57.8) (33.5) (16.0)
Management of liquid resources 1.1 (11.2) (13.9)
Financing - net increase in debt 53.2 45.7 29.6
Increase/(decrease) in cash in the period (3.5) 1.0 (0.3)
Reconciliation of net cash flow to movement in net debt
(See note 8)
Half year Half year Year
ended ended Ended
27 October 28 October 28
2001 2000 April
(unaudited) (unaudited) 2001
£m £m £m
Increase/(decrease) in cash in the period (3.5) 1.0 (0.3)
Increase in debt financing (53.2) (45.7) (29.6)
Increase/(decrease) in liquid resources (1.1) 11.2 13.9
Increase in net debt resulting from cash (57.8) (33.5) (16.0)
flows
Net debt acquired with subsidiary (3.5) (4.2) (5.3)
undertakings
Exchange differences (0.3) (0.5) (9.7)
Increase in net debt in the period (61.6) (38.2) (31.0)
Opening net debt (193.4) (162.4) (162.4)
Closing net debt (255.0) (200.6) (193.4)
Notes to the accounts
1 Basis of preparation
The interim financial information, which is unaudited, has been prepared using
the same policies as those adopted in the accounts for the financial year
ended 28 April 2001, except as set out below. The financial information for
the year ended 28 April 2001 is an abridged version of the accounts, as
restated following the adoption of FRS 19 'Deferred Tax'. Those accounts have
been reported on by the company's auditors and delivered to the Registrar of
Companies. The report of the auditors was unqualified and did not contain an
adverse statement under section 237(2) or (3) of the Companies Act 1985.
During the period, the Group adopted FRS 18 'Accounting Policies' and FRS 19 '
Deferred Tax'. There was no effect on the Group's net assets and results for
the period arising from the adoption of FRS 18.
Implementation of FRS 19 'Deferred Tax'
The standard, which affects the way the Group accounts for deferred tax, has
been adopted by the Group for the first time in these accounts. Comparative
amounts have been restated as appropriate.
FRS 19 requires full, rather than partial, provision for future corporate tax
liabilities, and has resulted in a prior year adjustment which has decreased
shareholders' funds and increased provisions by £58.8m at 29 April 2000. In
adopting FRS 19 the Group has decided not to use the option of discounting the
liability, as allowed by the standard. Comparative amounts have been restated
and consequently reserves have decreased and provisions increased by £59.5m at
28 October 2000 and £62.2m at 28 April 2001. The tax charges for the six
months ended 28 October 2000 and for the financial year ended 28 April 2001
have been increased by £0.7m and £3.4m respectively.
2 Analysis of Group turnover, profit and capital employed
Half year ended Half year ended Year
27 October 2001 28 October 2000 ended
(unaudited) (unaudited) 28 April
2001
£m £m £m
Turnover
Packaging: Corrugated and Paper 351.7 358.4 702.1
Plastics 93.9 76.2 161.1
445.6 434.6 863.2
Office products: Wholesaling 241.4 228.7 485.0
Manufacturing 34.8 35.8 71.4
Intra-segment sales (9.9) (9.9) (20.5)
266.3 254.6 535.9
711.9 689.2 1,399.1
By origin: United Kingdom 450.2 449.2 898.6
Rest of World 261.7 240.0 500.5
711.9 689.2 1,399.1
Operating profit (see below)
Packaging: Corrugated and Paper 29.2 29.9 51.3
Plastics 6.0 4.5 8.9
35.2 34.4 60.2
Office products: Wholesaling 6.4 10.3 24.4
Manufacturing 0.3 0.3 0.3
6.7 10.6 24.7
41.9 45.0 84.9
By origin: United Kingdom 27.7 31.7 56.6
Rest of World 14.2 13.3 28.3
41.9 45.0 84.9
Capital employed (see below)
Packaging: Corrugated and Paper 518.7 487.3 484.4
Plastics 80.6 73.4 82.0
599.3 560.7 566.4
Office products: Wholesaling 141.6 123.3 122.7
Manufacturing 38.0 36.4 36.4
179.6 159.7 159.1
778.9 720.4 725.5
By origin: United Kingdom 549.0 519.9 497.8
Rest of World 229.9 200.5 227.7
778.9 720.4 725.5
Operating profit is stated before amortisation of intangibles.
Capital employed excludes goodwill and other intangible assets, fixed asset
investments, net borrowings, deferred consideration due in respect of
acquisitions, corporation tax, dividends payable and minority interests.
3 Exceptional loss on termination of operations
The exceptional loss on termination of operations in the financial year ended
28 April 2001 related to the closure of the Group's Bracknell corrugated
packaging plant.
4 Tax charge
Tax on profits before exceptional items and amortisation of intangibles has
been charged at an effective rate of 30.0% (half year to 28 October 2000:
31.7%, year to 28 April 2001: 31.7%), being the expected full year effective
rate.
The tax charge for the period consists of UK taxation of £6.3m (half year to
28 October 2000: £6.9m, year to 28 April 2001: £12.7m) and overseas taxation
of £4.4m (half year to 28 October 2000: £4.9m, year to 28 April 2001: £9.0m).
The UK tax charge for the half year ended 28 October 2000 was stated net of a
tax credit of £0.7m (year to 28 April 2001: £1.2m credit) relating to the
exceptional items.
5 Earnings per share
The basic earnings per share have been calculated on the profit for the period
of £23.8m (half year to 28 October 2000: £24.6m, year to 28 April 2001:
£44.3m) and on 320.1m (half year to 28 October 2000: 320.3m, year to 28 April
2001: 320.2m) ordinary shares, being the weighted average in issue and fully
paid during the period.
The adjusted earnings per share excludes the effect of exceptional items and
amortisation of intangibles and has been calculated on the adjusted profit for
the period of £24.5m (half year to 28 October 2000: £26.5m, year to 28 April
2001: £48.5m).
6 Reconciliation of operating profit to net operating cash flow
Half year Half year Year
ended ended ended
27 October 28 October 28
2001 2000 April
(unaudited) (unaudited) 2001
£m £m £m
Operating profit before amortisation of
intangibles 41.9 45.0 84.9
Depreciation 31.2 28.9 60.4
Profit on sale of tangible fixed assets (0.4) - (3.2)
Working capital (24.0) (51.1) (39.7)
Increase in provisions (0.1) (0.3) (0.1)
Other non cash operating items 0.4 0.2 0.8
Cash flow from operating activities before
exceptional items 49.0 22.7 103.1
Operating cash flow relating to exceptional
items (see below) - (2.9) (4.5)
Net cash inflow from operating activities 49.0 19.8 98.6
The operating cash flows relating to exceptional items comprise the cash costs
of closing operations.
7 Capital expenditure and financial investment
Half year ended Half year ended Year
27 October 2001 28 October 2000 ended
(unaudited) (unaudited) 28 April
2001
£m £m £m
Purchase of tangible fixed assets (37.2) (33.4) (70.7)
Sale of tangible fixed assets 2.4 5.8 10.1
Purchase of fixed asset investments (0.5) (0.2) (2.2)
(35.3) (27.8) (62.8)
8 Analysis of net debt (unaudited)
At Acquired Cash Exchange At
28 April flow differences 27 October
2001 2001
£m £m £m £m £m
Cash at bank and in 10.0 0.1 - (0.4) 9.7
hand
Overdrafts (18.1) - (3.5) 0.2 (21.4)
(8.1) 0.1 (3.5) (0.2) (11.7)
Debt due after one (198.2) (0.1) (51.0) (0.2) (249.5)
year
Debt due within one (3.3) - (2.7) 0.4 (5.6)
year
Finance leases (3.1) (3.5) 0.5 - (6.1)
(204.6) (3.6) (53.2) 0.2 (261.2)
Short term 19.3 - (1.1) (0.3) 17.9
investments
Total (193.4) (3.5) (57.8) (0.3) (255.0)
9 Acquisition
On 11 September 2001, the Group acquired a number of corrugated packaging
operations on a back to back basis from Anglo American International S.A. (an
associate of Mondi Packaging UK) following their purchase of the UK paper and
packaging operations of Danisco A/S. The acquired operations consisted of two
corrugated sheet feeder plants, based at Kettering and Hastings, and 11
corrugated sheet plants mainly located in the south and west of the UK. The
businesses were acquired for a total consideration of £20.9m.
10 Post balance sheet event
On the 2 November 2001 the Group formed a joint venture with AEP Industries
Inc, acquiring a 50% stake in AEP's bag-in-box liquid packaging operations.
AEP's bag-in-box operations comprised its Liquipac business in New Zealand and
the Liquid Bag Systems business based in Australia and New Zealand, recently
acquired from VisyPak Operations Pty Limited. The total consideration was
£6.3m.
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