Euro CEO of the Year Miles Roberts: ‘Packaging has Never Been More Relevant’
The following is an excerpt from an exclusive interview that will appear in the March/April issue of Paper360° magazine. It is offered here as a special “sneak peek” for AOTC readers.
“Being able to navigate the volatile OCC and containerboard situation without missing a beat in terms of growing earnings and cash flows” and “Under Roberts’ leadership, DS Smith continues to capture margin by providing creative service and product enhancement to its myriad customers.” These were just two comments cited from investment analysts, industry consultants and commentators on why Roberts should pick up the prestigious RISI European CEO of the Year Award for 2018.
DS Smith is a leading provider of corrugated packaging and a specialist in plastic packaging worldwide. For the fiscal year 2016/17, the company had revenue of £4,781 million (US$6,798 million).
Miles Roberts, CEO, DS Smith.
P360: You last were awarded the RISI European CEO of the Year Award in 2012. Can you tell us, in a nutshell, how DS Smith has developed since that time, and how you feel about the business now and going forward?
Roberts: The business is very different now—we are in 37 countries, employing more than 27,000 colleagues. The growth since has been both organic and via a number of acquisitions including SCA Packaging, Duropack, Lantero, and most recently Interstate, in the US. I am very excited about the opportunities for the business. Packaging has never been more relevant.
Under your leadership, DS Smith has had a prolific acquisition strategy. Do any of these acquisitions over the last few years stand out in particular as ones you are delighted with?
Genuinely I can say we have been pleased with all our acquisitions. We learn something from all of them and we have inherited some fantastic new colleagues. In terms of size, SCA Packaging was transformational for the Group, as we became a pan-European player. Most recently, the acquisition of Interstate in the US gives us a fantastic opportunity to serve our customers on another continent.
And the strategy for more acquisitions in the future in Europe—will it be ‘business as usual’ for DS Smith on the acquisition front?
Business as usual is a good way of describing it. Of course we will remain financially disciplined, but we expect the business to grow both organically and via acquisition. Europe remains a highly fragmented market.
Tell us more about why DS Smith has made the move into the US with the acquisition of Interstate Resources. Why was it an attractive region for you, and is this a signal of more acquisitions to come?
Like all our acquisitions, this was customer-led. Almost all our top European customers operate in the US and we feel our expertise from the European packaging market—retail-ready packaging, for example—will be an asset to US customers. As within Europe, we expect a mix of organic and inorganic growth.
Meet Miles Roberts
Miles Roberts was appointed group chief executive of DS Smith in May, 2010. At DS Smith, he has implemented a clear strategy to become a leading provider of corrugated packaging in Europe.
Under his leadership, the company has grown organically and via a number of acquisitions, including SCA Packaging, Duropack, Grupo Lantero, and Interstate Resources. It is now present in 37 countries, employing around 27,000 people, and was elevated into the FTSE 100 in December, 2017.
Born in Tynemouth, Roberts attended Stanley Technical High in South Norwood before graduating from Bristol with a degree in Civil Engineering. He began his career as an engineer for Ove Arup.
Are there any other world regions that are appealing for an acquisition move—for instance, Latin America or Asia?
We never rule out any opportunities where they will help our customers, but as you would expect, any opportunity also must make sense for our shareholders. Overall, we feel the developed markets provide the best opportunity to create customer and shareholder value.
How about organic growth? What are we likely to see in terms of expansions or perhaps greenfield sites to grow existing operations in Europe and beyond?
We see significant opportunity to grow organically, and that can be by better using existing capacity or through developing greenfield sites. We have announced a few recently on both sides of the Atlantic, driven by our customers’ demand for our products, and I’d expect to see that continue.
Has or will the recent RCP policy shift on imports into China affected your business in any way, positive or negative?
We work with all the major suppliers and customers for RCP on a global basis. Changing regulations and demand are simply part of operating a business of the scale of our recycling operations.
Can you comment on any developments or innovations you are making in the area of e-retail and online shopping and the effects it is having on DS Smith business?
E-commerce is a very exciting and fast-growing market segment. We are working with many customers to help solve their problems including reducing void space, reducing returns, and the personalization of packaging.
Can you comment on any other notable innovation work DS Smith is engaging in? Recycling coffee cups is one area of note publicized recently—can you comment on the work being carried out in this area?
DS Smith has already been actively involved with industry participants, such as Costa, on lab and pilot plant-scale recycling tests. I am pleased this work has developed sufficiently well to be able to undertake research on an industrial scale that will provide the whole supply cycle with data on the recyclability of paper cups in mainstream packaging mills.
We look forward to sharing the results of the trial with the wider industry and working to improve re-use and the efficiency of the infrastructure in this important area.
Also, you’ve invested in digital printing equipment. Can you comment on that area?
With the increasing relevance of point of sale in the decision making process for consumers, together with the ability to personalize packaging, we see digital printing as a very important differentiator for our customer offering. We have been and will continue to invest in this area.
There is a feeling generally that the paper and board industry is on the cusp a new era of growth as plastic packaging gets bad press due to pollution issues. Is DS Smith ready for the probable mass increase in demand as supermarkets and retailers ditch plastic in favor of fiber-based packaging?
Our vision is to be the leading supplier of sustainable packaging solutions, working with our customers to minimize any impact on the environment we live in. It is an exciting time to be in the packaging market!
We are all very lucky to be operating in such a dynamic and exciting industry and I only see the relevance of fiber-based packaging increasing.
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