9th Apr 2020 08:57
(Alliance News) - Mondi PLC said Thursday it will not propose the payment of a final dividend for 2019, and has suspended all non-essential capital expenditure in order to preserve cash amid the Covid-19 pandemic.
However, the London and Johannesburg-listed paper and packaging firm has kept the majority of its operations open, aside from closing of the Merebank paper mill in South Africa, taking downtime at the Neusiedler mill in Austria, and production interruptions at some of Mondi's paper bag conversion plants.
For the first quarter of 2020, Mondi said its performance was robust and in-line with expectations, even as underlying earnings before interest, taxes, depreciation and amortisation declined by 18% to EUR385 million from EUR471 million, due to lower pricing across its key paper grades.
This figure, however, was up 1.0% from EUR381 million the previous quarter.
Mondi also said its order book held up well in the quarter, strengthening in consumer and e-commerce end-uses and Engineered Materials businesses. There was also strengths within Flexible Packaging, mainly from food, beverage and personal & home care.
In addition, Mondi said its balance sheet was strong, with EUR1.5 billion in liquidity, consisting of EUR800 million in cash and EUR705 million in undrawn debt facilities.
"Mondi is a resilient business offering packaging and other products for daily consumer needs, and delivering essential services to the communities around its larger operations. We delivered a robust performance in the first quarter and in this regard my thanks go to all our colleagues for their courage and commitment during these challenging times," said Chief Executive Officer Andrew King.
"The group is financially strong with a robust liquidity position and capital structure. However, in these unprecedented times we are taking appropriate actions to ensure we remain well-placed to withstand an extended period of uncertainty," King added.
Shares in Mondi were up 0.8% at 1,359.50 pence on Thursday in London, while its Johannesburg shares were 1.2% higher at ZAR304.72.
By Dayo Laniyan; [email protected]
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