DS Smith ahead of plan

10th Dec 2009 07:37

Packaging and office products wholesaler DS Smith expects to exceed full-year expectations after a ‘relatively good first half’.Underlying profit before tax , which excludes exceptional items, fell to £34.7m in the six months to the end of October, from £44.1m a year earlier.Exceptional costs of £0.5m were incurred in the first half of the year and it is anticipated that around £4m of restructuring costs will be taken in the second half.Revenue eased to £1,018m from £1,102.8m the year before. Return on sales nudged lower to 4.8% from 4.9% in the first half of last year while return on average capital employed dipped to 9.9% from 10.8%.The group’s pension scheme remains under review. The scheme had a pension deficit rose to £240.1m from £191.3m at the end of April s a result of a lower discount rate applied to the pension scheme liabilities, though this was partially offset by improved pension scheme asset values.Trading conditions remain uncertain and second half performance will depend on ‘the level of demand in the new calendar year and the speed of our recovery of the significant cost increases within our supply chain,’ the group said.The interim dividend has been sliced to 1.5p from 2.6p. The group has previously announced its intention to reduce total dividend payments for the year to 4.4p.