MNDI Mondi Plc

 
TIDMMNDI 
 
Mondi plc 
 
(Incorporated in England and Wales) 
 
(Registered number: 6209386) 
 
LEI: 213800LOZA69QFDC9N34 
 
LSE share code: MNDI                       ISIN: GB00B1CRLC47 
 
JSE share code: MNP 
 
7 October 2021 
 
Trading update: Strong Q3 performance 
 
Underlying EBITDA for the third quarter was ?388 million, up 27% compared to 
the prior year period (Q3 2020: ?306 million) and 9% on a sequential basis (Q2 
2021: ?356 million). 
 
Andrew King, Chief Executive Officer, said: "Mondi delivered a strong 
performance in the third quarter with higher average prices across the business 
and strong volume growth year-on-year, against a backdrop of sharply higher 
input costs. Throughout this period of high demand, we remained focused on 
ensuring security of supply and high-quality service for our customers. Our 
growth is underpinned by our leading packaging portfolio and we continue to 
develop innovative and sustainable packaging solutions to help our customers 
achieve their environmental goals. 
 
Our major capital investment projects are progressing well. With these 
investments we capture opportunities in our growing packaging markets, 
strengthen our cost competitiveness and deliver sustainability benefits. We 
also have expansionary projects underway at a number of our converting 
operations to grow with our customers, enhance our product and service 
offering, and improve efficiencies and converting costs. We are excited by the 
possibilities offered by our high-quality asset base, supported by strong 
structural growth trends in the markets we serve, including eCommerce and the 
demand for more sustainable packaging solutions, and we continue to evaluate 
further organic development opportunities in our packaging businesses." 
 
Business unit overview 
 
Demand for Corrugated Packaging continued to be strong across all end-uses. On 
the back of tight global markets, we implemented price increases during the 
quarter across our portfolio of containerboard grades. Corrugated Solutions 
performed strongly, growing volumes significantly year-on-year, while making 
good progress in passing on higher input paper costs. The integration of the 
Olmuksan acquisition continues to progress well. 
 
Flexible Packaging delivered strong volume growth in consumer, building and 
construction, eCommerce and specialised applications. On the back of strong 
order books, price increases across our range of kraft papers and paper bags 
were implemented during the quarter, where not fixed by annual or semi-annual 
contracts. The business made progress in passing on higher plastic resin costs. 
 
Engineered Materials' performance in the quarter was stable, as expected, with 
good volume growth in functional papers and films driven by a recovery in 
industrial and specialised applications, and strong demand for sustainable 
packaging materials. 
 
Uncoated Fine Paper sales volumes increased year-on-year with our customers 
valuing the stability of a long-term supplier in the key markets where we 
operate. Average uncoated fine paper prices were higher both year-on-year and 
sequentially, following price increases implemented during the year. 
 
Input costs and maintenance shuts 
 
Input costs were significantly higher in the quarter, both year-on-year and 
sequentially. When compared with the second quarter of 2021, we saw higher 
energy, resins, transport and chemical costs. Paper for recycling costs were 
mostly stable, although they increased towards the end of the quarter. Energy 
costs in Europe increased through the period and rose sharply at the end of the 
quarter on the back of material increases in electricity and gas prices. We 
expect them to remain at these elevated levels in the fourth quarter. 
 
The impact of scheduled maintenance shuts on underlying EBITDA during the 
period was around ?30 million. The fourth quarter's impact is estimated at 
around ?70 million, in line with previous estimates, and includes an extended 
project-related shut at Richards Bay (South Africa) as part of the ongoing 
modernisation programme at the mill. 
 
Outlook 
 
Demand remains strong and we are implementing price increases across the 
business that will support the recovery of ongoing inflationary pressures. 
While in the short term the fourth quarter will be impacted by recent input 
cost increases alongside planned maintenance and project-related shuts, the 
Group remains well-placed to deliver sustainably into the future, supported by 
our leading offering of sustainable packaging solutions, integrated 
cost-advantaged asset base and culture of continuous improvement. 
 
Contact details 
 
Investors/analysts 
Clara Valera                                     +44 193 282 6357 
Mondi Group Head of Strategy and Investor 
Relations 
 
Media 
Kerry Cooper                                     +44 193 282 6323 
Mondi Group Head of External Communication 
 
Richard Mountain                                 +44 790 968 4466 
FTI Consulting 
 
Conference call dial-in details 
 
A conference call will be held today at 08:00 (UK) / 09:00 (South Africa). 
 
The conference call dial-in numbers are: 
 
UK                         0800 279 6619 
 
South Africa           0800 014 552 
 
Other                      +44 2071 928 338 
 
Conference ID       3055818 
 
Should you have any issues with accessing the dial-in conference call, please 
call +44 2071 928 338. 
 
A replay facility will be available until 21 October 2021 (Pin number: 
3055818). The dial in details are: 
 
United Kingdom     0844 571 8951 
 
Other                      +44 3333 009 785 
 
Notes 
 
This trading update provides an overview of our financial performance and 
financial position since the half-year ended 30 June 2021. Financial metrics 
have not been audited or reviewed by Mondi's external auditors. 
 
Underlying EBITDA is an Alternative Performance Measure that is not defined or 
specified according to International Financial Reporting Standards. This 
measure is defined as operating profit before special items, depreciation, 
amortisation and impairments not recorded as special items. 
 
About Mondi 
 
Mondi is a global leader in packaging and paper, contributing to a better world 
by making innovative packaging and paper solutions that are sustainable by 
design. Our business is integrated across the value chain - from managing 
forests and producing pulp, paper and plastic films, to developing and 
manufacturing effective industrial and consumer packaging solutions. 
Sustainability is at the centre of our strategy and intrinsic in the way we do 
business. We lead the industry with our customer-centric approach, 
EcoSolutions, where we ask the right questions to find the most sustainable 
solution. In 2020, Mondi had revenues of ?6.66 billion and underlying EBITDA of 
?1.35 billion. 
 
Mondi has a premium listing on the London Stock Exchange (MNDI), and a 
secondary listing on the JSE Limited (MNP). Mondi is a FTSE 100 constituent, 
and has been included in the FTSE4Good Index Series since 2008 and the FTSE/JSE 
Responsible Investment Index Series since 2007. 
 
Sponsor in South Africa: UBS South Africa Proprietary Limited. 
 
 
 
END 
 
 

(END) Dow Jones Newswires

October 07, 2021 02:00 ET (06:00 GMT)

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