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03 Oct 2013

Smurfit Kappa announces redemption of €500 million 7.25% Senior Notes due 2017

Dublin, London, 3 October, 2013

Significant reduction in interest costs and immediately earnings accretive

Smurfit Kappa Group plc (“SKG” or the “Group”) announces that one of its wholly-owned subsidiaries, Smurfit Kappa Acquisitions, intends to redeem its €500 million 7.25% Senior Notes due 2017. The redemption will be funded from existing credit facilities together with approximately €220 million from the Group’s existing cash resources.

The Group expects cash interest savings from the redemption will be approximately €30 million per annum and the transaction will be immediately earnings accretive with an annualised increase in EPS of approximately 11 cent. There will be a one-off exceptional cost of approximately €26 million arising from the redemption premium and the accelerated amortisation of unamortised deferred debt issue costs related to the notes being redeemed.

Ian Curley, Smurfit Kappa Group CFO, commented: “This transaction is a further significant step in reducing our funding costs following the transition of SKG’s debt portfolio to an unsecured corporate profile.  The redemption further lowers SKG’s overall cost of capital, materially reduces debt servicing costs and enhances earnings and free cash flow.

The strength of our free cash flow generation allows us to fund a significant portion of the redemption from existing cash resources. Following the transaction, the Group continues to maintain strong liquidity in the form of cash and undrawn committed credit facilities.”