British packaging company Mondi said it will take an impairment charge of €100 million ($108.23 million) due to the closure of its Stambolijski paper mill after a fire.
The company will permanently close the Bulgarian mill after a fire broke out on 24 September causing extensive damage.
'After evaluating the options for repairing the mill and the ongoing investment required for the mill to remain competitive into the future, Mondi has concluded that closing the mill and serving customers out of its network of other kraft paper mills is the best course of action overall,' the company said in a statement.
The site closure will affect around 300 employees.
Muted Third-Quarter Trading
Mondi, which has key operations in Europe, North America and Africa, reported muted third-quarter trading conditions earlier this month, partly hurt by more planned maintenance shutdowns.
It posted an underlying core profit of €223 million for the three months ended 30 September, down about 36% from the second-quarter period.
"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.
The company has also entered into an agreement to acquire packaging assets of Schumacher Packaging in Germany, Benelux and the United Kingdom.
The initiative will help Mondi expand its corrugated footprint in Western Europe and add complementary fibre-based products, for the e-commerce and FMCG segments.
The deal includes corrugated converting and solid board operations of Schumacher Packaging.
