Smurfit Kappa Group plc (LON:SKG) has announced results for the full year ending 31 December 2023.
2023 Full Year | Key Financial Performance Measures
| €m | FY 2023 | FY 2022 | Change | H2 2023 | H2 2022 | Change | H1 23 | Change |
| Revenue | €11,272 | €12,815 | (12%) | €5,435 | €6,430 | (15%) | €5,837 | (7%) |
| EBITDA 1 | €2,080 | €2,355 | (12%) | €967 | €1,181 | (18%) | €1,113 | (13%) |
| EBITDA Margin 1 | 18.5% | 18.4% | 17.8% | 18.4% | 19.1% | |||
| Operating Profit before Exceptional Items 1 | €1,403 | €1,662 | (16%) | €624 | €823 | (24%) | €779 | (20%) |
| Profit before Income Tax | €1,055 | €1,293 | (18%) | €396 | €524 | (24%) | €659 | (40%) |
| Basic EPS (cent) | 293.5 | 365.3 | (20%) | 109.5 | 143.4 | (24%) | 184.0 | (40%) |
| Pre-exceptional Basic EPS (cent) 1 | 348.7 | 444.1 | (21%) | 151.5 | 222.2 | (32%) | 197.2 | (23%) |
| Free Cash Flow 1 | €628 | €545 | 15% | €509 | €573 | (11%) | €119 | 326% |
| Return on Capital Employed 1 | 17.1% | 21.8% | 19.0% | |||||
| Net Debt 1 | €2,840 | €2,992 | (5%) | €3,175 | (11%) | |||
| Net Debt to EBITDA (LTM) 1 | 1.4x | 1.3x | 1.4x |
Key points:
- Revenue of €11.3 billion
- EBITDA of €2,080 million and an EBITDA margin of 18.5%
- Return on capital employed of 17.1%
- Free cash flow of €628 million
- Net Debt to EBITDA ratio of 1.4x
- Announced combination2 with WestRock to create a global leader in sustainable packaging
- Final dividend increased by 10% to 118.4 cent per share
Tony Smurfit, Group CEO, commented:
“We are pleased to deliver an excellent outcome for the Group in 2023 with full year EBITDA of €2,080 million, an EBITDA margin of 18.5% and a ROCE above our target. Our results, the second best in our 90 year history, reflect the excellence of our people and their dedication in providing the most innovative and sustainable packaging solutions for our customers. The results also demonstrate the continuing benefits of SKG’s multi-year and highly effective capital programmes.
“The demand environment for the industry in 2023 was difficult primarily due to destocking and a lack of economic activity in certain sectors, particularly durable goods. However, one trend in which we have seen strong acceleration, is an increasing demand for sustainable packaging solutions. While full year volumes for the Group were down 3.5%, we saw a progressive improvement in demand during the year, with a return to growth in the fourth quarter.
“Our performance-led culture continues to drive our industry leading performance, with our people living our values of Loyalty, Integrity, Respect and Safety at work. We have a relentless focus on quality and delivery for our customers. This, combined with an unparalleled offering across our 36 countries and our unique industry applications, gives us an unrivalled advantage.
“As mentioned above, our disciplined capital allocation programme has been a significant source of our success. During 2023 we invested over €1 billion, which together with prior years’ spend, sets a strong platform for future growth and delivery. Additionally, with the wide geographic and product diversity that exists within SKG we continue to see opportunities for growth and expansion. As an example, we are developing our Bag‑in-Box business across multiple geographic regions and have expanded into Morocco with a new state of the art corrugated facility.
“In SKG we have always been at the forefront of ensuring we provide the most innovative and sustainable packaging for our customers as well as setting ambitious sustainability targets for ourselves. We will shortly release our 17th Sustainable Development Report, illustrating progress towards our 2030 targets. The Group continued to be recognised in 2023 for its leading sustainability credentials. Moreover in 2023, we received numerous awards across multiple categories, best illustrated by our 12 most recent WorldStar awards for innovation, significantly in excess of our peers.
“In September, we announced an agreement to combine with WestRock to form Smurfit WestRock. Since then we have had the opportunity to expand our knowledge of the WestRock organisation, and its people, and have visited many of their facilities. With a deeper understanding of the WestRock business, we are increasingly excited about the potential this combination presents.
“Our 2023 results again demonstrate Smurfit Kappa Group’s proven capacity to perform across all market conditions. While there are, and will always be, challenges in the macro environment, we look forward to the year ahead with confidence and excitement. Reflecting the continuing confidence in the strength, quality and performance of the Smurfit Kappa business, the Board is recommending a 10% increase in the final dividend to 118.4 cent per share.”
2023 Full Year | Performance Overview
The Group reported EBITDA for the full year of €2,080 million, 12% lower than 2022. However, the Group EBITDA margin for the year was 18.5%, up from 18.4% in 2022. In what has been a challenging year for the wider sector, this result reflects the effectiveness of our capital allocation program, the security of SKG’s integrated operating model and the commitment and dedication of our people in providing our customers with industry-leading, innovative and sustainable packaging solutions.
In Europe, EBITDA decreased by 14% to €1,593 million in 2023. The EBITDA margin was 18.8%, up from 18.6% in 2022 with the move reflecting lower box volumes and lower average box prices, which were more than compensated by the impact of lower recovered fibre, energy and other raw material costs. While box volumes in Europe were down 3.3% year-on-year, each quarter showed sequential improvement in demand and box volumes in the fourth quarter of the year remained flat compared to the same period of 2022. Demand weakness in Western European markets was partly offset by a more resilient performance in our operations in Southern and Eastern Europe.
Our European business continued to build on its strong operating platform during the year with a number of projects across our paper, corrugated and specialty divisions. In our paper division, we approved investments right across our mill network which will take out costs, increase efficiencies and enhance the Group’s leadership position in sustainability. In our corrugated division, we are investing in modern, energy efficient equipment, including upgrades to corrugators, new converting equipment and expanding capacity in our Bag‑in-Box division. These investments will allow the Group to increase production, reduce our environmental footprint and expand our portfolio of value-added packaging solutions.
In the first half of the year, the Group completed its strategic expansion in Poland with our Pruszków corrugated plant now becoming one of the most advanced packaging plants in Europe. In the second half of the year, the Group completed important sustainability projects including a pioneering purification and wastewater treatment plant in Serbia, the first of its kind in the country.
In 2023, the average price of testliner was €221 per tonne lower and the average price of kraftliner was €188 per tonne lower compared to the prior year. Commercial downtime taken by our recycled containerboard mills in Europe was approximately 330,000 tonnes in 2023 with almost no commercial downtime taken in our kraftliner mills. In order to maintain our position as a key player in the market and to address the weak demand backdrop, SKG announced the closure of its 75,000 tonnes per year Alfa d’Avignon recycled containerboard mill in Le Pontet, France.
In the Americas, EBITDA increased by 1% on 2022 to €557 million. The EBITDA margin improved to 20.1% from 19.0% in 2022 with Colombia, Mexico and the US accounting for over 75% of the region’s earnings. Box volumes in the Americas, excluding acquisitions, were down by 4.3% compared to 2022 with sequential demand improvement seen through each quarter and a return to growth realised in the fourth quarter of 1.6% year-on-year.
SKG continued to invest in its Americas business during the year, with growth and sustainability related investments across our forestry, paper and packaging businesses in Brazil, Colombia, Mexico and the US. We approved investments in our paper division to upgrade machines and increase production efficiencies, investing in automation in our forestry division to take out costs, while investing in state-of-the-art converting equipment in our corrugated division. We are also expanding our capacity in Bag-in-Box in the region.
Earlier in the year, the Group announced that it had sold its Russian operations to local management thereby completing its exit from the Russian market. In July, the Group opened a new integrated corrugated plant in Morocco, making this SKG’s first operation in the attractive growth market of North Africa. Also during the year, the Group acquired a specialty packaging operation in Spain and a folding carton business in Poland.
The Group reported free cash flow of €628 million in the full year of 2023, up 15% on the €545 million reported in 2022. The average maturity profile of the Group’s debt was 4.0 years at 31 December 2023 with an average interest rate of 2.79%. Net debt to EBITDA was 1.4x at the year-end versus 1.4x at the half year and 1.3x at the end of December 2022. The Group remains strongly positioned within its BBB-/BBB-/Baa3 credit rating. Following the announcement of the combination with WestRock on 12 September 2023, Moody’s placed our credit rating on Review for Upgrade, S&P Global Ratings placed our credit rating on CreditWatch Positive and Fitch Ratings placed our long-term issuer default rating on Rating Watch Positive.
2023 Full Year | Financial Performance
Revenue for the full year was €11,272 million, down 12% on the prior year on a reported basis and down 11% on an underlying basis3. Revenue in Europe was down 14%, driven primarily by lower paper and box pricing year-on-year and lower box volumes. On an underlying basis, revenue in Europe was down 12%. In the Americas, revenue was down 5% on 2022, or 6% on an underlying basis.
EBITDA for the full year was €2,080 million, down 12% on the prior year. On an underlying basis, Group EBITDA was down 9% year‑on‑year, with Europe down 10% and the Americas was flat.
Operating profit before exceptional items for the full year of 2023 at €1,403 million was 16% lower than €1,662 million in 2022.
Exceptional items charged within operating profit in 2023 amounted to €152 million, €58 million of this related to costs associated with the WestRock combination, €34 million related to currency recycling, impairment of residual assets up to the date of disposal and other costs associated with the disposal of our Russian operations, €30 million due to the devaluation of the Argentinian Peso, €11 million related to redundancy and reorganisation costs in the Americas and €14 million and €5 million respectively for the closure of our operations and impairment of property, plant and equipment in Alfa d’Avignon, France.
Exceptional items charged within operating profit in 2022 amounted to €223 million, of which €128 million related to the impairment of assets in our Russian operations, €56 million and €11 million respectively for the impairment of goodwill in Argentina and Peru, €14 million for redundancy and reorganisation costs in the Americas along with €14 million for the impairment of property, plant and equipment in our North American operations.
Pre-exceptional net finance costs at €185 million were €36 million higher than 2022 primarily due to a negative swing in the net monetary hyperinflationary gain in 2022 to a loss in 2023 and a higher interest cost on net pension liabilities, partly offset by lower cash interest.
Net exceptional finance items charged in 2023 amounted to €13 million and related to bond consent and bridge facility fees regarding the combination with WestRock, partly offset by an exceptional item in relation to the devaluation of the Argentinian Peso.
There were no exceptional finance items charged in 2022.
With the €259 million decrease in operating profit before exceptional items, combined with the €36 million increase in pre-exceptional net finance costs, the pre-exceptional profit before income tax was €1,220 million, or €296 million lower than in 2022.
After exceptional items of €165 million, the profit before tax for the full year of 2023 was €1,055 million compared to a profit before tax of €1,293 million in 2022. The income tax expense was €296 million compared to €348 million in 2022, resulting in a profit of €759 million for the year to December 2023 compared to a profit of €945 million in 2022.
Basic EPS for the full year of 2023 was 293.5 cent, compared to 365.3 cent in 2022. On a pre‑exceptional basis, EPS was 348.7 cent in 2023, compared to 444.1 cent in the full year of 2022.
2023 Full Year | Free Cash Flow
Free cash flow for the full year of 2023 was €628 million compared to €545 million for 2022, an increase of €83 million. Lower EBITDA of €275 million combined with higher outflows on exceptional items, higher tax payments and a higher outflow for changes in employee benefits and other provisions were more than offset by a positive swing in working capital from an outflow in 2022 to an inflow in 2023 with capital outflows remaining broadly stable.
The working capital inflow in 2023 was €148 million compared to an outflow of €358 million in 2022. The working capital inflow in 2023 was a combination of a significant decrease in debtors and stock, partly offset by a decrease in creditors. These movements reflected the combination of lower box prices, lower paper prices and lower energy, recovered fibre and other raw material prices. Working capital amounted to €768 million at December 2023 and represented 7.0% of annualised revenue compared to 8.3% at December 2022.
Capital expenditure in 2023 amounted to €1,056 million (equating to 171% of depreciation) compared to €970 million (equating to 155% of depreciation) in 2022.
Cash interest amounted to €123 million in 2023 compared to €132 million in 2022, with the decrease largely as a result of additional interest income earned on our deposits due to the higher interest rate environment. This was partly offset by higher interest costs on our variable rate debt balances.
Tax payments of €406 million in 2023 were €85 million higher than in 2022. The increase in 2023 mainly arises due to high taxable profits generated in prior periods and the associated timing of tax payments.
2023 Full Year | Capital Structure
Net debt was €2,840 million at the end of December 2023, resulting in a net debt to EBITDA ratio of 1.4x compared to 1.4x at the end of June 2023 and 1.3x at the end of December 2022. The Group’s balance sheet continues to provide considerable long-term strategic and financial flexibility, subject to the stated leverage range of 1.5x to 2.0x through the cycle.
At 31 December 2023, the Group’s average interest rate was 2.79% compared to 2.89% at 31 December 2022. The decrease in our average interest rate on debt is primarily due to the repayment of debt during the year in certain of our higher interest rate environments. At 31 December 2023, over 95% of the Group’s gross borrowings were at fixed interest rates.
The Group’s diversified funding base and long-dated maturity profile of 4.0 years (31 December 2022: 4.9 years) provide a stable funding outlook. At 31 December 2023, we had a strong liquidity position of approximately €2.56 billion comprising cash balances of €905 million, undrawn available committed facilities of €1,346 million on our sustainability-linked Revolving Credit Facility (‘RCF’) and €312 million on our sustainability-linked securitisation facilities.
Dividends
The Board is recommending a 10% increase in the final dividend to 118.4 cent per share. It is proposed to pay this dividend on 10 May 2024 to all ordinary shareholders on the share register at the close of business on 12 April 2024, subject to the approval of the shareholders at the AGM.
2023 Full Year | Sustainability
Smurfit Kappa continues to make significant progress towards achieving its sustainability goals as outlined in its 16th Sustainable Development Report (‘SDR’) published in 2023. The report shows that the Group’s actions are delivering today, and together with its ongoing investments and continuous improvement, we are well positioned to deliver on our long-term ambition to have at least net zero emissions by 2050.
Several landmark achievements are noted in the report including the announcement of a US$100 million investment in a sustainable biomass boiler in our paper mill in Cali, Colombia, our largest single decarbonisation project to date, which will reduce our Group emissions by approximately 6%. Further progress is also outlined across key metrics including CO2 emissions reduction, water consumption, chain‑of‑custody certification, waste reduction and health and safety.
An example of some of the important sustainability projects undertaken during the year include the installation of 12,000 solar panels at our Sanguesa paper mill in Spain. This solar energy project is the latest for Smurfit Kappa which has launched similar green energy initiatives at plants in Spain, Colombia, Mexico and most recently, in our new facility in Morocco.
In 2023 we also completed a €27 million investment in a new waste management and recovery facility at our Nervión paper mill in Iurreta, Spain. This investment sees the mill adopt a fully circular production process involving the biggest landfill reduction project that SKG has undertaken to date.
In September, we inaugurated a pioneering purification and wastewater treatment plant in Belgrade, Serbia, the first of its kind in the country. This innovative treatment purifies water to the highest standards before it can be returned to the environment. It also reduces electricity usage and CO2 emissions by up to 80% and the purified water can be reused thereby further reducing water consumption by up to 90%.
During the year, we approved significant investments to upgrade a combined heat and power plant in one of our European paper mills which will further reduce our carbon emissions alongside upgrading a number of water treatment plants and systems right across our operations.
Having been awarded in 2023 as both a Regional Top Rated and Industry Top Rated company by Morningstar Sustainalytics, SKG has retained both honours this year for its strong ESG credentials and continuous improvement. SKG is now ranked 1st in Paper & Packaging in 2024, up from 2nd in 2023 and 4th in 2022.
Smurfit Kappa continues to be listed on various environmental, social and governance indices and disclosure programmes, such as, CDP, FTSE4Good, the Green Economy Mark from the London Stock Exchange, Euronext Vigeo Europe 120, STOXX Global ESG Leaders, ISS Solactive and Ethibel’s sustainable investment register. SKG also performs strongly across a number of third party certification bodies, including MSCI, ISS ESG and Morningstar Sustainalytics.
2023 Full Year | Commercial Offering and Innovation
SKG’s leadership in innovation and unrivalled market offering is a defining characteristic of our business. With over 1,000 designers across the Group, supported by a network of laboratories, design facilities and unique applications, we continued to deliver the most innovative and sustainable packaging solutions for our customers in 2023. The Group continues to invest in research and development to push the boundaries of paper-based packaging and our design teams work closely with our customers to develop bespoke solutions which optimise functionality, cost-effectiveness and consumer appeal.
Demonstrating our industry leadership, SKG won 74 awards across a host of categories including design, safety, sustainability, community engagement and as a top employer. Smurfit Kappa was recognised for its technical innovation and creativity by winning 14 awards at the Flexographic Industry Association UK awards in addition to eight WorldStar 2023 awards. The latter was followed up by winning an impressive 12 WorldStar 2024 awards in January of this year, more than any other entrant. The Group was also the proud winner of PepsiCo’s prestigious ‘Supplier of the Year’ award. This award recognises excellence across sustainability, speed to market and overall business performance and is the latest milestone in a fifteen-year partnership during which PepsiCo and Smurfit Kappa have collaborated on various stand-out projects.
During the year, SKG launched its patented Vitop Uno tap which is the first tap in the Bag-in-Box market to have attached tamper protection. Vitop is the leading provider of Bag-in-Box closure solutions with over six billion taps sold worldwide and the Uno tap is now patented in Europe, the USA and a number of other countries.
In 2023, the Group announced the expansion of its Design2Market Factory after a successful first year in operation in the Netherlands. This unique facility, which provides customers with tangible packaging prototypes that can be tested in the market in just two weeks before moving into large-scale production, will be replicated across Germany, Italy, Poland and the UK.
SKG also launched its new digital solution for our existing SupplySmart application. With SupplySmart, we create a digital model of our customer’s supply chains which allows us to stress-test their processes in a completely risk-free way. This helps us to optimise their packaging solutions, enhance efficiencies, reduce CO2 emissions during transport and drive business growth.
The Group continues to experience strong levels of pipeline development across our business as customers strive for more sustainable packaging solutions.
| Summary Cash Flow |
| Summary cash flowsfor the second half and full year are set out in the following table. |
| H2 2023 | H2 2022 | FY 2023 | FY 2022 | |
| €m | €m | €m | €m | |
| EBITDA | 967 | 1,181 | 2,080 | 2,355 |
| Exceptional items | (49) | (3) | (49) | (3) |
| Cash interest expense | (57) | (71) | (123) | (132) |
| Working capital change | 410 | 143 | 148 | (358) |
| Capital expenditure | (627) | (621) | (1,056) | (970) |
| Change in capital creditors | 108 | 84 | 73 | (24) |
| Tax paid | (233) | (163) | (406) | (321) |
| Change in employee benefits and other provisions | (20) | (3) | (66) | (25) |
| Other | 10 | 26 | 27 | 23 |
| Free cash flow | 509 | 573 | 628 | 545 |
| Disposal of Russian operations | – | (50) | 1 | (50) |
| Share buyback | – | (41) | – | (41) |
| Purchase of own shares | – | (1) | (28) | (28) |
| Purchase of businesses, investments and NCI* | (26) | (62) | (30) | (110) |
| Dividends | (87) | (83) | (367) | (333) |
| Bond consent and bridge facility fees | (23) | – | (23) | – |
| Derivative termination (payments)/receipts | (3) | 1 | (3) | 1 |
| Net cash inflow/(outflow) | 370 | 337 | 178 | (16) |
| Acquired net cash/(debt) | – | 2 | – | (3) |
| Deferred debt issue costs amortised | (4) | (3) | (7) | (7) |
| Currency translation adjustment | (31) | (19) | (19) | (81) |
| Decrease/(increase) in net debt | 335 | 317 | 152 | (107) |
| *‘NCI’ refers to non-controlling interests |
| A reconciliation of the Summary Cash Flow to the Consolidated Statement of Cash Flows and a reconciliation of Free Cash Flow to Cash Generated from Operations are included in sections K and L in Alternative Performance Measures in the Supplementary Financial Information on pages 35 to 38. |
Funding and Liquidity
The Group’s primary sources of liquidity are cash flow from operations and borrowings under the RCF. The Group’s primary uses of cash are for funding day to day operations, capital expenditure, debt service, dividends and other investment activity including acquisitions.
The Group has a €1,350 million sustainability-linked RCF with a maturity of January 2026, which incorporates five KPIs spanning the Group’s sustainability objectives regarding climate change, forests, water, waste and people, with the level of KPI achievement linked to the pricing on the facility. Borrowings under the RCF are available to fund the Group’s working capital requirements, capital expenditure and other general corporate purposes. At 31 December 2023, the Group’s drawings on this facility were €4 million, at an interest rate of 4.595%.
At 31 December 2023, the Group had outstanding €250 million 2.75% senior notes due 2025, US$292.3 million 7.50% senior debentures due 2025, €1,000 million 2.875% senior notes due 2026, €750 million 1.5% senior notes due 2027, €500 million 0.5% senior green notes due 2029 and €500 million 1.0% senior green notes due 2033.
At 31 December 2023, the Group had outstanding €13 million variable funding notes (‘VFNs’) issued under the €230 million trade receivables securitisation programme maturing in November 2026 and €5 million VFNs issued under the €100 million trade receivables securitisation programme maturing in January 2026.
Funding and Liquidity (continued)
Both these securitisation programmes are sustainability-linked and incorporate five KPIs spanning the Group’s sustainability objectives regarding climate change, forests, water, waste and people, with the level of KPI achievement linked to the pricing on the programmes.
In connection with the proposed WestRock combination, we entered into a Bridge facility agreement in the amount of US$1,500 million which is available to finance the cash consideration and any fees, commissions, costs and expenses in connection with the proposed combination. At 31 December 2023, the facility was undrawn.
Market Risk and Risk Management Policies
The Group is exposed to the impact of interest rate changes and foreign currency fluctuations due to its investing and funding activities and its operations in different foreign currencies. Interest rate risk exposure is managed by achieving an appropriate balance of fixed and variable rate funding. At 31 December 2023, the Group had fixed an average of 98% of its interest cost on borrowings over the following 12 months.
The Group’s fixed rate debt comprised €250 million 2.75% senior notes due 2025, US$292.3 million 7.50% senior debentures due 2025, €1,000 million 2.875% senior notes due 2026, €750 million 1.5% senior notes due 2027, €500 million 0.5% senior green notes due 2029 and €500 million 1.0% senior green notes due 2033.
The Group’s earnings are affected by changes in short-term interest rates on its floating rate borrowings and cash balances. If interest rates for these borrowings increased by one percent, the Group’s interest expense would increase, and income before taxes would decrease, by approximately €2 million over the following 12 months. Interest income on the Group’s cash balances would increase by approximately €9 million assuming a one percent increase in interest rates earned on such balances over the following 12 months.
The Group uses foreign currency borrowings, currency swaps and forward contracts in the management of its foreign currency exposures.
Principal Risks and Uncertainties
Risk assessment and evaluation is an integral part of the management process throughout the Group. Risks are identified, evaluated and appropriate risk management strategies are implemented at each level in the organisation.
The Board in conjunction with senior management identifies major business risks faced by the Group and determines the appropriate course of action to manage these risks.
The Board regularly monitors all of the Group’s risks and appropriate actions are taken to mitigate those risks or address their potential adverse consequences. In addition, emerging risks and the current global uncertainties were also considered as part of the year-end assessment. The process completed for risk at the year-end focused on the principal risks and uncertainties for Smurfit Kappa as a standalone entity.
However, consideration was also given to risks which arise specifically as a result of the proposed Combination with WestRock, which included the following: (1) Smurfit Kappa has incurred, and will incur, further fees and costs in connection with the Combination, regardless of whether it is completed, and these fees and costs may be greater than anticipated. Any delay in the completion of the Combination would likely incur additional fees and costs. In the event of a valid termination of the Combination by Smurfit Kappa, termination fees may be payable by Smurfit Kappa to WestRock; and (2) Smurfit Kappa has been, and will continue to, invest resources in the Combination and the associated integration planning activities. In the event that the Combination was not to complete, these resources could otherwise have been spent in connection with other activities of Smurfit Kappa.
The principal risks and uncertainties facing the Group are summarised below.
- If the current economic climate were to deteriorate, for example as a result of geopolitical uncertainty, trade tensions and/or a pandemic, it could result in an increased economic slowdown which if sustained over any significant length of time, could adversely affect the Group’s financial position and results of operations.
- The cyclical nature of the packaging industry could result in overcapacity and consequently threaten the Group’s pricing structure.
- If operations at any of the Group’s facilities (in particular its key mills) were interrupted for any significant length of time, it could adversely affect the Group’s financial position and results of operations.
- Price fluctuations in energy and raw material costs could adversely affect the Group’s manufacturing costs.
- The Group is exposed to currency exchange rate fluctuations.
- The Group may not be able to attract, develop and retain suitably qualified employees as required for its business.
- Failure to maintain good health, safety and employee wellbeing practices may have an adverse effect on the Group’s business.
- The Group is subject to a growing number of environmental and climate change laws and regulations, and the cost of compliance or the failure to comply with current and future laws and regulations may negatively affect the Group’s business.
- The Group is subject to anti-trust and similar legislation in the jurisdictions in which it operates.
- The Group, similar to other large global companies, is susceptible to cyber-attacks with the threat to the confidentiality, integrity and availability of data in its systems.
- The global impact of climate change in the long-term could adversely affect the Group’s business and results of operations.
The principal risks and uncertainties faced by the Group, were outlined in our 2022 Annual Report on pages 34 to 36. The Annual Report is available on our website; smurfitkappa.com.
