The London-headquartered packaging giant recorded sales on continuing operations in the year to 30 April 2023 up 14% or by 11% on a constant currency basis to £8.22bn. Adjusted operating profit climbed by 40%, or 35% constant currency, to £861m, while pre-tax profit grew by 75%, or 71% constant currency, to £661m.

The company attributed its adjusted operating profit growth to improved product “added value”, and effective cost mitigation more than offsetting volume declines and a more challenging inflationary environment.

Meanwhile, it said strengthening customer relationships drove record customer ratings and contract wins, while good free cashflow of £354m reduced leverage to 1.3x net debt/EBITDA, compared to 1.6x a year ago.

The business also reported continued momentum in plastic replacement, with 762 million units of plastic replaced since 2020 and 297 million in 2022/23.

Group chief executive Miles Roberts said: “The performance of the business during the year has been excellent, despite the challenging economic environment and I am extremely proud of all our colleagues for their dedication and support.

“We have had an unremitting focus on meeting our customers’ rapidly changing needs with new innovation. This, together with high levels of service and our sustainability performance, has been rewarded through market share gains during the period.

“Our operational, environmental, and financial performances have all been strong through the year. Our service levels have remained very high, supporting our customers through our robust and flexible supply chain.”

He added that while box volumes have remained lower than normal, trading for the year to date “is in line with our expectations”.

“Our strong customer relationships in the resilient FMCG sector, together with the investments we are making to drive cost efficiencies and growth, give us confidence for the future.”

Speaking to BBC Radio 4’s Today programme this morning (22 June), Roberts added: “It’s clearly been a very volatile time. There’s been pressure across the final consumer, but as a group we’ve really stayed very, very close to our customers in this rapidly changing environment and we’ve continued to invest, so as a result of that we’re pleased for the overall performance for the group.

“It has been quite challenging in the UK – demand is weak. We’ve seen a lot of supply side friction – additional costs coming through – and clearly, we do everything we possibly can to improve those but ultimately, faced with these costs, to keep a viable business and to keep us investing we do have to raise prices.”

DS Smith’s share price climbed slightly in early trading today following the publication of the results but was down 1.1% on yesterday’s close at the time of writing at midday to 286.90p. (52-week high: 369.10p, low: 238.10p).