5th Aug 2021 09:36
(Alliance News) - Mondi PLC on Thursday posted virtually flat first-half profit as rising sales volumes and price increases helped cushion the company from persistent economic uncertainty.
The Addlestone, Surrey-based paper and packaging firm said pretax profit for the six months ended June 30 slipped 1.1% to EUR461 million from EUR466 million, with revenue rising by 5.1% to EUR3.63 billion from EUR3.45 billion.
It declared an interim dividend of 20.0 euro cents per share, up 5.3% from 19.00 cents last year.
For the first half to June, underlying earnings before interest, tax, depreciation and amortization declined 3.9% to EUR709 million from EUR738 million in the prior year. Mondi's underlying Ebitda margin was 19.5% in the recent half.
Mondi Chief Executive Andrew King said the company was pleased with its first-half performance, with sales volume growth and pricing momentum in its packaging markets strong.
"Encouragingly, we have also seen improving uncoated fine paper markets. We exhibited strong cost control, against a backdrop of rising commodity input costs, whilst keeping a sharp focus on delivering our high-quality product and service offering to our customers," King said.
Mondi said it retained a strong financial position despite an increase in net debt to EUR2.00 billion as at June 30, up from EUR1.80 billion at December 31. This, it said, reflected its strong cash generation capacity, as well as the ongoing investment in the business, including the acquisition of Olmuksan and an increase in working capital.
Going forwards, King said that while macroeconomic uncertainties remain, trading was positive.
"In the second half, we expect to see the full impact of the price increases implemented to date and the continued contribution from our capital investment projects," he said.
Mondi, he said, aimed to cut costs to offset expected the planned maintenance shuts and ongoing input cost pressures.
Shares in Mondi rose 2.6% to ZAR411.42 on Thursday morning in Johannesburg. In London, the stock was up 3.1% at 2,064.00 pence.
By Artwell Dlamini; [email protected]
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