AGM Statement

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: GB00B1CRLC47LSE share code: MNDI As part of the dual listed company structure, Mondi Limited and Mondi plcnotify both the JSE Limited and the London Stock Exchange of matters requiredto be disclosed under the Listing Requirements of the JSE Limited and/or theDisclosure and Listing Rules of the United Kingdom Listing Authority. 13 May 2015 MONDI LIMITED AND MONDI plc - ANNUAL GENERAL MEETINGS ADDRESS TO SHAREHOLDERS BY THE JOINT CHAIRMEN, CHAIRMAN OF THE SOCIAL & ETHICSCOMMITTEE AND CHIEF EXECUTIVE OFFICER Fred Phaswana, Joint Chairman, speaking from Johannesburg: Good morning, ladies and gentlemen. On behalf of the boards of Mondi Limitedand Mondi plc, we welcome you to the eighth annual general meeting of the MondiGroup. We are very pleased that you are joining us here in Johannesburg andthere in London. As is custom at our meeting, although we're on separatecontinents with the use of modern technology, David Williams and I, and ourfellow board directors, take great pleasure in being able to talk to you thismorning, as one. As you know, we share the chair of the Mondi Group and David Williams and Iwould both like to say a few words this morning about Mondi's progress over thelast year. Imogen will then report on the social and ethics committee beforeyour chief executive, David Hathorn, reviews the Group's performance andstrategy in a little more detail as well as updating you on the Group's interimmanagement statement that we published earlier today. After this we will bedelighted, as a board, to take your questions. But first, let me introduce youto your directors. To my immediate left is Imogen Mkhize, an independent non-executive directorand chair of the Mondi Limited social and ethics committee. Next to her isDavid Hathorn, your chief executive officer. And on his left is PhilipLaubscher, company secretary of Mondi Limited. Next to Philip is Andrew King,your chief financial officer. With David Williams in London, we have Stephen Harris, an independentnon-executive director and chairman of the DLC sustainable developmentcommittee. Anne Quinn, our senior independent director and chair of the DLCremuneration committee and beside her Carol Hunt, company secretary of Mondiplc. To David's right, we have Peter Oswald, chief executive officer of the Europeand International Division and, finally, John Nicholas independentnon-executive director and chairman of the DLC audit committee. For the benefit of our new shareholders I should point out that, although thedual listed company structure means that Mondi Limited in South Africa andMondi plc in the UK are separate corporate entities, each with its own boardand shareholders, Mondi operates as a single corporate group, managed as asingle economic enterprise. The two companies have the same board members andthe same management team. The DLC structure means that shareholders in eachcompany fully share in the performance of the Group as a whole. 2014 was another successful year for the Group. Mondi delivered exceptionallystrong results and also made significant headway with its strategicinitiatives. We continued to make progress in developing our packaginginterests in a sustainable way, expanded our packaging converting footprintthrough acquisitions and completed a number of capital projects successfully. Mondi's record financial performance and strong cash generation enabled theGroup to further strengthen its financial position in 2014. On the back of thisstrong financial performance we are pleased to continue to offer shareholderslong-term dividend growth within the targeted dividend cover range of two tothree times, on average, over the cycle. The Boards have recommended a finaldividend of 28.77 euro cents per share. If approved, this dividend, togetherwith the interim dividend amounts to a total for the year of 42 euro cents pershare, an increase of 17% from 2013. Before I hand over to David Williams, I would just like to highlight a fewareas in which we made particular progress last year. At the end of 2014 Mondi employed some twenty five thousand people across morethan thirty countries, with a particularly strong presence in central Europe,Russia, north America and South Africa. Often, we are the single largestemployer in the areas in which we are located and with this comes a greatresponsibility, which we take very seriously. We want Mondi to be asustainable, socially-responsible business that makes a real and lastingcontribution to every community within which we operate. We evaluate the economic and social impact of our operations on the localcommunity. This enables us to build tailored programmes that bring tangiblebenefits to those communities. In 2014 we contributed seven million euros tocorporate social investment projects and charitable donations with a focusmainly on education and health. Here in South Africa, we continue to be a supporter of the government's policyof broad-based black economic empowerment, which influences many of ouremployment and procurement practices. Collaboration is fundamental to the way we do things and we work with manypartners to find solutions to challenges and make progress together. Animportant development for us was the three year strategic global partnership wesigned with WWF International focusing on environmental stewardship in thepackaging and paper sectors through ecosystems management, manufacturingpractices and product stewardship. All of these developments are covered in detail in our integrated report andthe sustainability section on our website, additional copies of our reports areavailable today - or you can download these from our web site. With that, I'd like to hand over to my co-chairman, David Williams, in London.David. David Williams, Joint Chairman, speaking from London: Thank you, Fred. I would also like to take this opportunity to welcome you to the Mondi annualgeneral meeting. As a board we strive to maintain the highest standards of corporate governanceand best practice. Following the positive external board review conducted in2013, we conducted an internal process in 2014. We consider these reviewsimportant and benefit from the opportunity to stand back and reflect on how wecan continue to perform effectively. We openly discuss strategic decisions bringing a constructive level ofchallenge and support. In continuing to deliver long-term value we will take advantage of selectedgrowth opportunities, focusing particularly on developing the Group's packaginginterests. In addition, our aim is to fully realise the potential ofacquisitions made in recent years, successfully deliver ongoing capitalexpenditure projects and continue to manage costs. Safety remains paramount to all of us in the Group and for several years wehave continued to improve our overall performance. Our goal of zero harm is animperative for the business and safety continues to be a key item on the agendaat every board meeting. Our commitment to sustainability covers a wide range of aspects beyond safety.We are particularly pleased with our continued progress in sustainableforestry, the increased use of renewable energy sources, energyself-sufficiency and reducing our reliance on carbon intensive energy sources.Our significant capital investment projects have also contributed toenvironmental improvements. You can read more about our achievements andprogress in our printed and online sustainability reports. Considering the challenging economic environment many of our businessescontinue to face, Mondi's ability to deliver strongly across the cycle istestament to the quality of the business, the strength of our strategy andespecially our people. We thank all the Mondi team for their determination,innovation and focus on building a successful business. I now hand you back to South Africa and Imogen Mkhize, who will provide thereport on the Social and Ethics Committee. Imogen. Imogen Mkhize, Chairman of the Mondi Limited Social & Ethics Committee,speaking from Johannesburg: Thank you, David. During the year the committee focused on reviewing Mondi Limited's compliancewith the various obligations under the South African companies act andregulation. This included social and economic development, broad-based blackeconomic empowerment, corporate citizenship, safety, health and theenvironment, consumer relationships and labour, employment and skillsdevelopment and employment equity. While the report detailing the full extentof the initiatives reviewed by the committee during the year can be found inMondi's integrated report I would like to highlight just a few. In terms of the South African government's broad-based black economicempowerment codes of good practice, an independent assessment confirmed thatMondi again maintained its status as a level three contributor in 2014. In addition to Mondi's partnership with WWF International, environmentalhighlights included the ISO 14001 certification of forestry operations and asuccessful Forest Stewardship Council audit of forestry operations. The work of Mondi Zimele, the small development initiative, has contributed togrowing small businesses in Mondi's supply chain. Their employment footprintwas 2,600 jobs and in addition 400 potential entrepreneurs and business peoplewere trained in 2014. In Mkhondo - Mpumalanga, through a public-private partnership with government,Mondi facilitates access to homes with security of tenure, basic services,social amenities and economic opportunities for people currently living onMondi's land. In conclusion, it is evident to the committee that Mondi demonstrates acommitment to sustainability and responsible business. Additional informationon these and other company initiatives can be found in both the integratedreport as well as the printed and online sustainable development reports. With that, I'd like to hand over to your Chief Executive, David Hathorn. David. David Hathorn, Chief Executive Officer, speaking from Johannesburg: Thank you, Imogen. As your chairmen have said, in 2014 Mondi had another very successful year withstrong contributions from all our business units. Underlying earnings per shareincreased by 13% and our return on capital employed of 17.2% was a record forthe Group. Pleasingly, for the past four years we have consistently deliveredreturns above the Group's through-the-cycle hurdle rate of 13%. The Group'ssolid financial results, delivered despite continued slow economic growth in anumber of key markets, are testament to our robust business model andhigh-quality low-cost asset base. Revenue was broadly in line with the prior year. On a like-for-like basis,selling prices and volumes were similar to the prior year with revenue boostedby the acquisition of the bags business in the United States, offset bynegative currency impacts and disposals or closures of non-core businesses. Our packaging paper business continued to deliver very strongly despite agenerally weaker pricing environment, driven by cost reduction and currencybenefits. The fibre packaging business benefited from lower paper input costs and goodvolume growth. Consumer packaging saw a strong improvement in trading in the second half ofthe year. Coupled with the benefits of a number of sales and margin improvementinitiatives, the business was able to deliver a pleasing improvement inyear-on-year performance. Uncoated fine paper came under pressure from weaker pricing and negativecurrency effects, but nevertheless continued to deliver strongly, while theSouth Africa Division benefited from higher average selling prices and the weakrand. Contributing to these results were the benefits from the recently completedcapital investments, primarily around energy efficiencies and cost optimisationin the pulp and paper operations, and continued strong cost management acrossthe Group. Good progress is also being made with the integration ofacquisitions made during the year. The Group continues to be strongly cash generative with cash generated fromoperations exceeding 1 billion euro. Net debt of 1.6 billion euro was at similar levels to the previous year despitea significant pick-up in capital expenditure on major projects and over 100million euro spent on acquisitions. We are pleased that Mondi's credit rating has recently been upgraded byStandard and Poor's from BBB- to BBB stable. This follows the upgrade fromMoody's Investors Service from Baa3 to Baa2 last year. While acquisition led growth remains a key component of our strategy, and wewill continue to evaluate opportunities as they arise, we currently see greateropportunity for value-enhancing growth through capital investments in ourexisting operations. To this end we successfully completed a number of major projects during theyear, and have approved a strong pipeline of projects for implementation overthe coming two years. In April 2014 our 70 million euro, 155,000 tonne per annum bleached kraft papermachine in Steti, Czech Republic was successfully started up and in November,we commissioned the new 128 million euro recovery boiler in Ruzomberok,Slovakia, making the mill 100% energy self-sufficient and significantlyimproving its environmental footprint, in addition to reducing ongoing costsand providing additional pulp production capacity. In November we also completed the 100,000 tonne 30 million euro pulp dryer inSyktyvkar, Russia. The 166 million euro project in Swiecie, Poland, bringing forward the plannedreplacement of the recovery boiler and coal fired boilers, is progressingaccording to plan and on track for start-up in the second half of 2015. Early this year, the Boards approved 94 million euro for the second phase ofthe Swiecie project to ensure full utilisation of the new recovery boiler'scapacity, providing an additional 100,000 tonnes per annum of softwood pulp,80,000 tonnes per annum of kraftliner and further improving the mill's productmix flexibility. At the South Africa Division's Richards Bay mill approximately 30 million eurowas approved to upgrade its wood yard. Other significant projects in progressor approved during the year, amounting to approximately 130 million euro,include projects intended to further modernise some of the Group's kraft paperand converting operations, provide additional capacity and productionflexibility and reduce ongoing operating and maintenance costs. As you know, earlier today we released our interim management statement. Iwould like to take this opportunity to briefly summarise the main points of theannouncement. First quarter underlying operating profit of 236 million euro was 29% above thecomparable prior year period, on volume growth and lower input costs acrossmost of the European businesses, with good contributions from capital projectsand acquisitions, and higher selling prices in Russia and South Africa. Theresult was 9% above the fourth quarter of 2014. Average selling prices in Europe for all key paper grades were broadly in linewith those in the previous quarter and, with the exception of recycledcontainerboard, also in line with the comparable prior year period. Averagebenchmark recycled containerboard prices were around 6% lower than the firstquarter of 2014. On a like-for-like basis, sales volumes were up across most businesses on boththe comparable prior year period and the previous quarter. The Group benefited from generally lower input costs relative to the comparableprior year period, driven in part by currency impacts. Wood costs, paper forrecycling, resin, energy and chemicals costs were all lower than the comparableprior year period. Inflationary pressures in a number of the emerging marketsin which the Group operates are expected to increase going forward. Inaddition, the recent recovery in the oil price is expected to negatively affectthe cost of energy, resin and chemicals. The strengthening of the US dollar versus the euro provided a net benefit tothe Group and the weaker Russian rouble in the early part of the year had a netnegative impact on the domestically focused uncoated fine paper business offsetin part by the export-oriented Russian packaging paper operations. However,during the quarter, the rouble strengthened sharply from its lows. Good progress is being made on the Group's major capital investment projects,with all projects proceeding on schedule and within budget. Much depends on the macroeconomic environment. However, given the Group'srobust business model and clear strategic focus, management remains confidentof continuing to deliver industry leading performance and making good progressfor the year. Now I would like to hand you back to our joint chairman David Williams. Ends We are Mondi: In touch every day Mondi is an international packaging and paper Group, employing around 25,000people across more than 30 countries. Our key operations are located in centralEurope, Russia, North America and South Africa. We offer over 100 packaging andpaper products, customised into more than 100,000 different solutions forcustomers and end consumers. In 2014, Mondi had revenues of €6.4 billion and areturn on capital employed of 17.2%. The Mondi Group is fully integrated across the packaging and paper value chain- from managing forests and producing pulp, paper and compound plastics, todeveloping effective and innovative industrial and consumer packagingsolutions. Our innovative technologies and products can be found in a varietyof applications including hygiene components, stand-up pouches, super-strongcement bags, clever retail boxes and office paper. Our key customers are inindustries such as automotive; building and construction; chemicals; food andbeverage; home and personal care; medical and pharmaceutical; packaging andpaper converting; pet care; and office and professional printing. Mondi has a dual listed company structure, with a primary listing on the JSELimited for Mondi Limited under the ticker code MND and a premium listing onthe London Stock Exchange for Mondi plc, under the ticker code MNDI. For us, sustainable development makes good business sense. We don't just talkabout sustainability; we make it part of the way we work every day. We havebeen included in the FTSE4Good Index Series since 2008 and the JSE's SociallyResponsible Investment (SRI) Index since 2007.

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