The company credited growth and improved margins for the increase in profits, along with efficiency savings and the integration of French subsidiary Otor.

Its UK packaging division saw revenues increase by 14% from £450.3m to £514.4m due to increases in pricing and some volume growth. The group said its corrugated R-Flute product was continuing to grow ahead of the market, with volumes up 6% year-on-year.

Operating profits in the UK packaging sector grew 25% from £32m to £39.9m which it attributed to improved efficiency and procurement savings.

Its continental European corrugated packaging division saw revenues rise by 8% year-on-year and adjusted operating profits increase by 23%, excluding the impact of the Otor acquisition, which was only consolidated for two months when last year’s results were published.

The group’s interim dividend per share increased 40% from 2p to 2.8p.

DS Smith plans to increase capacity in the UK and has installed additional printing equipment at two sites, which will be operational in the next financial year, to develop high quality printed packaging products for FMCG customers.

It also plans to increase offset capacity in southwest France for the manufacture of high quality packaging.

The group reduced its net debt from £345.1m last year to £312.9m in 2011 and cut its net pension liability from £143.4m to £112.8m.

DS Smith’s recycling business has expanded into Poland following its work with Tesco to collect used paper and cardboard from Tesco in the country.

The group said that the disposal of Spicers, the group’s wholesale office stationery business, which is being sold to Unipapel for £200m, is expected to be completed by the end of the year. The group said that, after the disposal of Spicers, it will be a business focused on recycled packaging.

DS Smith chief executive Mike Roberts said he was "pleased" with the group’s "improved performance of every division" and signalled its intent to make acquisitions in the packaging sector.

He said: "We have a strong balance sheet with only a limited Group profit exposure to paper, and will evaluate opportunities to pursue acquisitions within a fragmented packaging sector that can meet our medium term objectives.

"We remain confident in the trading outlook for the remainder of this financial year."