8th Oct 2015 12:36
LONDON (Alliance News) - Mondi PLC on Thursday said its underlying operating profit was 27% higher in the third quarter year-on-year as it benefited from good trading in all of its divisions.
The Anglo-South African paper and packaging company said underlying operating profit in the third quarter rose to EUR221.0 million, up from EUR174.0 million a year earlier following strong trading in its Packaging Paper and Uncoated Fine Paper units and in its business in South Africa.
The rise was a big improvement on the 13% decline in underlying operating profit in the second quarter, when the group was hit by planned maintenance shutdowns in key operations and a traditional seasonal slowdown for demand in come segments.
Selling prices for key paper grades in the third quarter were generally stable or higher year-on-year in the quarter, Mondi said, while like-for-like volumes were higher with the exception of kraft paper, which was hit by softer demand and the closure of a production facility.
Input costs remained stable in the quarter in local currency terms, the company said, while average benchmark European paper for recycling costs rose by 13% against the second quarter. Polyethylene prices were still volatile, the company said, with average prices higher quarter-on-quarter.
Mondi saw a mixed currency impact in the quarter, with its South African arm benefiting from the depreciating rand against the dollar and the euro, while the weakening of the Russian rouble hit profits from its uncoated fine paper business in the country.
Mondi said it continues to deliver robust results, benefiting from stable to higher selling prices in key grades, and said it remains confident on its outlook.
In a separate statement later in the day, Mondi also said it has concluded the tender process for its audit contract and has handed the mandate to PricewaterhouseCoopers LLP. PwC will take on the contract from Deloitte after Mondi's 2016 financial year.
By Sam Unsted; [email protected]; @SamUAtAlliance
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