Mondi is an international packaging and paper Group, employing around 26,000 people in production facilities across 31 countries. In 2013, Mondi had revenues of €6.5 billion and a return on capital employed (ROCE) of 15.3%. The Group’s key operations are located in central Europe, Russia, the Americas and South Africa. It is fully integrated across the paper and packaging process – from growing of wood and the manufacture of pulp and paper (including recycled grades), to the conversion of packaging papers into corrugated packaging and industrial bags. It has primary listings on the Johannesburg Stock Exchange and the London Stock Exchange. It is a constituent of the FTSE 250 Index


Wood
Wood is Mondi’s most important raw material. It is therefore in our interest to ensure that we meet and support the requirements of sustainable forestry practices, from the management of our own forests right through to the procurement of our wood and fibre through the supply chain.


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Forestry
As a significant holder and manager of land, particularly in developing countries, and as an operator in an industry that potentially has a high impact on the natural environment, we recognise our stewardship role and responsibility in using natural forestry resources in a sustainable way.

Forests provide a range of goods and services. They serve as habitats for two-thirds of terrestrial animal and plant species; prevent soil erosion and water run-off; maintain the chemical balance of soil, air and water; recycle nutrients; break down pollutants; clean the air and water; are vital to watershed protection and soil formation; and play a major role in regulating climate.

The main factors contributing to deforestation and forest degradation are increased agriculture, illegal logging, population growth, poverty and urbanisation. Primary concerns include deforestation resulting from illegal logging in protected or high conservation value (HCV) areas, and timber obtained from controversial sources.

Although Mondi is involved in the felling of trees, we are not party to deforestation. For every tree felled in our plantation forests, at least one more tree is planted. In our natural forests, felled areas are left to regenerate naturally and poor regeneration is supplemented with plantings. Mondi is not involved in illegal logging, or logging in tropical rainforests, and has strict fibre sourcing controls.

Pulp
Wood is an essential raw material for all of our virgin fibre-based products. From wood fibre we produce pulp, the basic ingredient of all paper and paper-based packaging. We use pulp in our own production and also sell it wholesale to third parties. The pulp for paper-making may be produced from virgin fibre by either chemical or mechanical means, or it may be produced by the re-pulping of recovered paper. In the pulping process, the raw cellulose-bearing material is broken down into its individual fibres. In chemical pulping, chemicals are used to dissolve the lignin and free the fibres.

Recovered paper has become an indispensable raw material for our business and, in 2011, we consumed 1.5 million tonnes of recovered fibre, amounting to 30% of our total pulp consumed.

The pulp and paper manufacturing process also requires a large amount of process water and energy (in the form of steam and electrical power), which makes it an energy- and natural resource-intensive one.


http://www.mondigroup.com/desktopdefault.aspx

Trading statement Wednesday 13 May

Interim management statement

13 May Davy Research N/A Outperform
13 May Goodbody N/A Hold
12 May Credit Suisse 1,485.00 Outperform

Mondi makes headway in first quarter; shares in paper maker top FTSE 100

By Andrew Neil

May 13 2015, 11:07am
Mike van Dulken, head of research at Accendo Markets, said Mondi’s results were packed full of positives.



Paper maker Mondi (LON:MNDI) pulled off a punchy performance in its first quarter, sending shares to the top of the FTSE 100 this morning.

Operating profit in the three months to March was €236mln the South African company said – that’s 29% above the comparable period last year.

Wood costs, paper for recycling, resin, energy and chemicals costs were all lower than last year, while currency movements also helped out.

The rise in underlying operating profit was also due to volume growth across most of the European businesses.

Contributions from capital projects and acquisitions, and higher selling prices in Russia and South Africa, aided the performance, it said.

On its outlook, the paper and packaging firm said much depends on the macroeconomic environment, but that it remained confident of making good progress for the year.

Mike van Dulken, head of research at Accendo Markets, said Mondi’s results were packed full of positives.

“Average paper selling prices holding up and comparable sales growth across most business, both sequentially and annually, is also welcome news at this stage of the year,” he said.

“While management says the ‘outlook remains macro-dependant’, its confidence in FY progress is going down well with the investment community this early in the year when other corporates are possibly more cautious.”

Shares were still trading 10% higher at 11am, priced at 1,441p.

Questor-share-tip-Mondi-shares-jump-10pc-on-strong-start

14 May Credit Suisse 1,630.00 Outperform
14 May Deutsche Bank 1,640.00 Buy

8 Jul Davy Research N/A Outperform

20 Jul Investec 1,650.00 Buy

28 July 2015

Mondi Group: Trading Statement

In terms of paragraph 3.4(b) of the Listings Requirements of the JSE Limited, companies are required to publish a trading statement as soon as they become reasonably certain that the financial results for the period to be reported on next will differ by at least 20% from those of the previous corresponding period.

Mondi is currently finalising its results for the half year ended 30 June 2015, which will be released on 6 August 2015. It can now be confirmed that underlying operating profit for the half year ended 30 June 2015 is expected to be above that of the comparable prior year period of EUR377 million.

In the six months ended 30 June 2014, the Group recognised a net special item charge after tax of EUR16 million. The net special item charge for the six months ended 30 June 2015 is around EUR36 million, relating mainly to restructuring activities including the closure of a small kraft paper mill in Finland, the closure of a consumer packaging plant in Spain and further restructuring of the US bags business.

Accordingly, Mondi advises that it expects earnings per share (EPS) for the half year ended 30 June 2015 to be within the ranges shown below:

•basic underlying EPS (euro cents) 65 to 70 (2014 51.9), an increase of between 25% and 35%


•basic EPS (euro cents) 57 to 62 (2014 48.6), an increase of between 17% and 28%


•basic headline EPS (euro cents) 57 to 62 (2014 48.3), an increase of between 18% and 28%


Mondi has disclosed basic underlying EPS, which is defined as basic EPS excluding the impact of special items, as the directors believe this provides a useful additional measure of the Group?s underlying performance. Mondi has disclosed basic EPS which includes the effect of special items. The disclosure of basic headline EPS is required under the Listings Requirements of the JSE Limited and has been calculated in accordance with Circular 2/2013 as issued by the South African Institute of Chartered Accountants.

The above information has neither been reviewed nor audited by Mondi?s auditors.

Mondi PLC (MNDI:LSE) set a new 52-week high during today's trading session when it reached 1,544. Over this period, the share price is up 46.39%.

Half year report

Highlights

•Strong performance on all key financial metrics, with all business units delivering significantly improved results

◦Underlying operating profit of ?490 million, up 30%


◦Underlying earnings of 67.8 euro cents per share, up 31%


◦Cash generated from operations of ?538 million, up 23%


◦Return on capital employed of 19%



•Successful delivery on capital projects and acquisitions

◦Recently completed projects delivering ahead of plan


◦Current major projects on time and on budget


◦Turnaround of US Bags business acquired in 2014 on track



•Interim dividend of 14.38 euro cents per share, up 9%

Company News

Mondi profits up 30% off sales lift

Thu, 06 August 2015



(ShareCast News) - Packaging firm Mondi reported first half profits up 30% to €490m, following a boost in sales.
The dual-listed company said underlying earnings per share were up 31% compared with the same half last year to 67.8 euro cents, in line with the underlying profit lift.

Group revenue was up 10% due to higher sales volumes and prices, acquisitions and currency effects. Excluding the effects of acquisitions and disposals, this figure was up 3.9% compared with last year.

Mondi said like for like sales volumes were up across all Europe and international markets, but sales from South Africa were hit by extended annual maintenance at its Richard Bay mill in that region.

An interim dividend of 14.38 euro cents per share, up 9% on the prior year interim dividend of 13.23 euro cents per share was declared.

Management said it was confident about making good progress for the year.

7 Aug Investec 1,700.00 Buy
7 Aug Deutsche Bank 1,750.00 Buy

Shares - so where have investors made money among large caps? Packaging, housebuilders and insurance have been the stand out performers. The idea that you can achieve in excess of 50% profit from a FTSE 100 stock in just over 7 months would seem out of this world. Theoretically large caps are meant to be slow and steady , double digit returns are more the domain of the FTSE250 and lower. Yet international packaging group Mondi (MNDI) has surprised nearly everyone with a 52% gain year-to-date. Its no wonder investors have been clambering to own the stock.

Market Buzz

Mondi downgraded to 'sell' by Goldman Sachs

Wed, 16 September 2015

(ShareCast News) - Mondi, the paper and packaging group, has been downgraded to 'sell' by Goldman Sachs after a strong run in the shares and "stretched" growth expectations.
Goldman said it saw 12% downside to shares in the FTSE 100 group, which was spun-off from miner Anglo American in July 2007, after a 41% price rise since the start of the 2015.

The US bank said it believed growth expectations were stretched, given Mondi's high exposure to kraftliner packaging and near-50% sales exposure to emerging markets.

On publication, Mondi trades at 8.9 times 2016 expected EV/EBITDA on 3% expected EBITDA growth in 2016, versus Goldman's packaging average of 12% and 7.4 times expected EV/EBITDA.

A new target price of 1,300p was set, down from the previous 1,380p.

Last month Mondi reported first half profits up 30% to €490m, following a boost in sales, with the London- and Johannesburg-listed company enjoying said like for like sales volumes were up across almost all European and international markets.

Mondi-drops-on-worries-about-the-packaging-industry.

6 Oct Davy Research N/A Outperform
6 Oct Credit Suisse 1,960.00 Outperform

MONDI

08 Oct 2015 07:00:00



Mondi PLC



Mondi Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1967/013038/06)
JSE share code: MND ISIN: ZAE000156550

Mondi plc
(Incorporated in England and Wales)
(Registered number: 6209386)
JSE share code: MNP ISIN: GB00B1CRLC47
LSE share code: MNDI

As part of the dual listed company structure, Mondi Limited and Mondi plc (together ?Mondi Group?) notify both the JSE Limited and the London Stock Exchange of matters required to be disclosed under the Listings Requirements of the JSE Limited and/or the Disclosure and Transparency and Listing Rules of the United Kingdom Listing Authority.

Mondi Group: Interim Management Statement 8 October 2015

This interim management statement provides an overview of the financial performance and financial position of the Group since the half-year ended 30 June 2015, based on management information up to 30 September 2015 and estimated results for October 2015. These results have not been audited or reviewed by Mondi?s external auditors.

Reviewed results for the year ending 31 December 2015 will be published on or around 25 February 2016.

Except as discussed in this interim management statement, there have been no significant events or transactions impacting either the financial performance or financial position of Mondi Group since 30 June 2015 up to the date of this statement.

Group Performance Overview

Third quarter underlying operating profit of ?221 million was 27% above the comparable prior year period (?174 million) with a good performance from all business units and strong incremental contributions from Packaging Paper, Uncoated Fine Paper and the South Africa Division. As anticipated, underlying operating profit was 13% lower than the second quarter, reflecting the impact of planned maintenance shuts in a number of key operations and the usual seasonal slowdown in demand in certain segments.

Selling prices in local currency terms for most of the Group?s key paper grades were generally stable to higher versus both the second quarter and the comparable prior year period. Like-for-like sales volumes were up on the comparable prior year period with the exception of kraft paper, which was impacted by softer demand in certain export markets and the closure of the Lohja plant in the first half.

Among the key input costs, wood, energy and chemical costs remained stable in local currency terms, while average benchmark European paper for recycling costs rose by 13% over the previous quarter. Polyethylene prices remain volatile, with the average price level higher than the prior quarter.

There was a mixed impact in the period from currencies to which the Group is exposed. The South Africa Division benefited from the weaker rand against both the US dollar and euro while the weakening of the Russian rouble during the third quarter had a net negative translation effect on the profits from the domestically focused uncoated fine paper business.

During the third quarter, a number of planned maintenance shuts took place at various containerboard, kraft paper and uncoated fine paper operations. In the fourth quarter, maintenance shuts are planned at the Group?s Swiecie and Steti mills. For the full year, based on prevailing selling prices, the impact of maintenance shuts on underlying profit is still expected to be around ?90 million, of which the third quarter effect was around ?35 million (?70 million year-to-date).

Divisional Overview

In Packaging Paper, the containerboard business benefited from higher average selling prices versus both the comparable prior year period and the previous quarter, offset in part by higher paper for recycling costs. Average benchmark European virgin containerboard prices increased by 2% and recycled containerboard by 5% over the previous quarter as previously announced price increases came into effect. Demand remains good in all grades.

While European kraft paper markets remain stable, sack kraft export volumes are under some pressure due to a combination of political instability in the middle-east and north Africa and a slowdown in demand in certain south-east Asian markets.

The Fibre Packaging business benefited from volume growth and a reduction in fixed costs versus the comparable prior year period as a result of commercial excellence initiatives and the benefits of completed restructuring activities. Corrugated Packaging margins were negatively impacted by rising recycled containerboard input costs. The integration of the bags business acquired in the US continues to progress according to plan. The expected seasonally weaker demand in Industrial Bags will lead to lower profitability in the fourth quarter compared to the third quarter.

The Consumer Packaging business continues to make good progress with higher like-for-like sales volumes and improved margins versus the comparable prior year period. During the quarter, the sale of non-core operations in Germany and Malaysia was completed, in line with the Group?s strategy of focusing on higher-value added segments. In September, the Group announced that it had signed an agreement for the acquisition of Ascania nonwoven Germany GmbH for ?45 million, strengthening Mondi?s position as a preferred supplier of hygiene components. Completion remains subject to competition clearance.

Uncoated Fine Paper was impacted by the usual seasonal weakness in the third quarter, planned maintenance shuts and the weaker Russian rouble. Average European benchmark selling prices were up around 1% over the previous quarter. Price increases of between ?25/tonne and ?50/tonne depending on grade were successfully implemented in Europe during the quarter, while a price increase of 5% has been announced for the Russian market from October. The unintegrated mills in Austria remain under pressure from higher euro pulp prices.

The South Africa Division benefited from higher average domestic selling prices, higher export prices for hardwood pulp and currency gains. As anticipated, fair value gains on forestry assets were lower than both the previous quarter and the comparable prior year period.

Capital investment projects

Good progress is being made on the Group?s major capital investment projects although the ramp-up of the recently rebuilt paper and in-line coating machine at the Group?s Steti mill in the Czech Republic is slower than anticipated. As a consequence, the Group expects to deliver an incremental ?50 million contribution (previously ?60 million) to underlying operating profit in 2015 from its capital investment programme.

In July 2015, the first phase of the ?166 million Swiecie recovery boiler project in Poland was commissioned according to schedule, and a number of the smaller projects intended to modernise some packaging paper and converting operations have been completed and are in the process of ramp-up and optimisation.

Cash flow and financing activities

Strong cash generation from operating activities more than offset the cash outflows related to the Group?s capital expenditure programme and financing activities, resulting in a reduction in net debt during the quarter, with further deleveraging expected by the end of the year.

Finance charges were lower than that of the preceding quarter and the comparable prior year period, primarily due to lower average net debt levels and a reduction in exposure to higher-cost Russian rouble denominated debt.

There have been no significant changes in the Group?s borrowing facilities since 30 June 2015.

Summary

The Group continues to deliver strongly, benefiting from stable to higher selling prices in a number of key grades and the contributions from its capital investment programme. Currency volatility has had a limited impact on the Group, while costs remain generally stable. With our robust business model, clear strategic focus and culture of continuous improvement, management remains confident of continuing to deliver industry leading performance and making good progress for the year.

Capital Markets Day

On 3 November 2015 Mondi will host a Capital Markets Day in London to give investors and analysts further insight into Mondi?s business, growth strategy and capital expenditure programme. Presenters will include the Group Executive Committee and CEOs of the Group?s primary business units. All presentations will be made available on the Group?s website.

MONDI

08 Oct 2015 11:45:34



Mondi PLC



Mondi Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1967/013038/06)
JSE share code: MND ISIN: ZAE000156550

Mondi plc
(Incorporated in England and Wales)
(Registered number: 6209386)
JSE share code: MNP ISIN: GB00B1CRLC47
LSE share code: MNDI

As part of the dual listed company structure, Mondi Limited and Mondi plc (together ?Mondi Group?) notify both the JSE Limited and the London Stock Exchange of matters required to be disclosed under the Listings Requirements of the JSE Limited and/or the Disclosure and Transparency and Listing Rules of the United Kingdom Listing Authority.

8 October 2015

Error Correction: Interim Management Statement 8 October 2015

The reference to the acquisition price of Ascania nonwoven Germany GmbH (?Ascania?) in the Interim Management Statement should have read ?54 million (not ?45 million as stated).

Full details of the acquisition of Ascania were set out in the Mondi Group announcement published on 18 September 2015.

8 Oct Davy Research N/A Outperform
8 Oct Goodbody N/A Hold
8 Oct Deutsche Bank 1,750.00 Buy