WITH long experience of charting a course through recurrent growth/slump cycles of the paper and packaging industry management at Smurfit Group need no crystal ball to peer into the immediate future. The signs of imminent down turn are self apparent, the only uncertainty is the depth of the approaching trough and the extent of financial damage that could be inflicted on the group.

Given its geographical diversity Smurfit is better positioned than most players in the business to ride out hard times. Last year was particularly productive and full cash granaries will help buttress group through leaner harvests ahead.

This week Smurfit produced a record set of results, strong growth in all areas generating £3 billion in sales and £420 million in pre tax profits, the highest ever reported by an Irish public company.

Benefits from the £683 million acquisition of French packaging group Cellulose du Pin in 1993 flowed through in trebled European sales of around £1.8 billion.

Profits from operations in France, Austria and Sweden raced ahead from £35 million to £1 million and solid performances were achieved in Latin America; the US and Canada; and Ireland and Britain.

But falling prices for linerboard and finished boxes means Smurfit now faces a substantial slowdown in profitability this year and next.

Smurfit finance director Ray Curran cautions against under pessimism in saying that, while some slippage seems inevitable, "We're certainly not looking at a bad year". Analysts' forecasts vary greatly, some brokers expect profits to halve by 1997, then rebound sharply.

Shareholders are urged to keep their nerve, sentiment sweetened with a whopping 50 per cent rise in total dividend to 4p a share.