Updated / Thursday, 1 May 2025 14:52
US order books at the world’s largest cardboard box maker Smurfit Westrock are steadying after “a lot of weakness” in March and early April amid falling consumer confidence, the company’s chief executive Tony Smurfit said today.
Smurfit said the Ireland-headquartered company was “seeing a lot of nervousness” among its customers that span the household goods, food and pharmaceutical sectors in relation to tariffs but that it had not yet translated into “any material issue”.
He made the comments after the packaging giant reported first quarter core profit of $1.25 billion, in line with its guidance, and forecast a 6% to 11% rise in full year earnings to between $5 billion and $5.2 billion.
“We did see a lot of weakness in March and the first two weeks of April. It seems to be steadying itself, our order books are getting better in the second half of April than they were in the six weeks prior to that. That gives us some encouragement,” Tony Smurfit told an analyst call when asked about the US market.
Smurfit Westrock expected some recovery in the second half of the year but not the kind of bounceback some competitors were talking about that would require a level of consumer confidence that is not currently seen in surveys, he added.
Smurfit said the European market was a bit better and that while demand may not be strong, it is “reasonable” and on an improving trend.
While it largely sells to customers within each of the 40 countries in which it operates, Smurfit said it has adjusted its US/Canada supply chains in response to tariffs to cut out the previous large amount of cross border trade.
Smurfit Westrock was formed when Smurfit Kappa, the largest paper packaging producer in Europe, completed its $11 billion acquisition of US rival WestRock last July.
Tony Smurfit said today’s results were driven by good results across all three segments, with notable progress in North America, and is significantly ahead of the combined result for the previous year.
“I am especially pleased with how well the combination has come together, with strong operational and cultural integration taking place across all three regions,” he said.
“Coupled with our geographic footprint and our unrivalled portfolio of innovative and sustainable packaging solutions, we have a customer-focused and performance-driven team that is delivering for all stakeholders,” he said.
Mr Smurfit said the company’s synergy programme is on track to deliver $400m, with about $350m in the current year.
“We believe there is substantial opportunity to continue to structurally improve the business through a sharper commercial and operational focus, at least equal to our synergy target,” he said.
He also sai the company continues to actively optimise its asset base and recently announced the closure of over 500,000 tons of paper capacity in North America.
“We are also closing two converting facilities in our North American region and have initiated consultations to close two of our converting facilities in EMEA & APAC,” he stated.
Smurfit WestRock shares had fallen by 6.7% this quarter and lost 22% so far this year.
