British packaging company Mondi said trading conditions remained muted in the third quarter, after it reported a lower core profit compared with the previous three-month period, partly hurt by more planned maintenance shutdowns.
The paper and packaging sector has witnessed increasing consolidation in recent times, as companies gradually recover from softer demand and weak pricing due to destocking by customers. But broader economic challenges worldwide slackened the pace of recovery.
"While we are seeing the benefits from the increase in prices earlier this year across our key paper grades, trading conditions remain muted against the backdrop of an uncertain macroeconomic environment," CEO Andrew King said in a statement.
Quarterly Highlights
The FTSE 100 company, which has over 100 production sites in more than 30 countries, said selling prices of corrugated and flexible packaging edged up versus the previous quarter, while pulp and paper selling prices in uncoated fine paper declined in the period on a quarter-to-quarter basis.
Mondi, which has key operations in Europe, North America and Africa, posted an underlying core profit of €223 million ($242 million) for the three months ended 30 September, down about 36% from the second-quarter period.
Recently, the company entered into an agreement to acquire packaging assets of Schumacher Packaging in Germany, Benelux and the UK as it seeks to expand its corrugated footprint in Western Europe and add complementary fibre-based products, for the e-commerce and FMCG segments.
"Overall, our organic growth investments are expected to deliver a meaningful EBITDA contribution from 2025. Together with the recently announced acquisition of the Western European assets of Schumacher Packaging, the additional capacity will ensure Mondi is well positioned to capitalise on the structural growth in sustainable packaging," King added.
News by Reuters, additional reporting by ESM.
