Mondi Shares Rise to Highest on Record as Profit IncreasesKamlesh Bhuckory
Mondi Ltd., a South African maker of paper and packaging, rose the most since September last year after it said second-quarter profit will be higher than in the previous three months.
“The underlying operating profit for the second quarter of 2013 is expected to be higher than” the 162 million euros ($215 million) in the three months through March, the company said in a statement today. Profit will also be higher than in the second quarter last year, it said. Basic headline earnings per share will be 43 cents to 48 cents for the first half of 2013, compared with 30.9 cents a year ago.
The Johannesburg-based company’s restructuring plans in Europe and South Africa resulted in a special items charge of 68 million euros, according to the statement. Mondi is reducing exposure to sluggish economies by expanding in developing markets such as Eastern Europe.
“The headline earnings per share update is slightly ahead of what I was expecting,” Sean Ungerer, an analyst at Johannesburg-based Avior Research (Pty) Ltd., said in a phone interview. “The market likes the statement. We would need to be cautious about what is going to happen in the second half though, especially in terms of planned maintenance.”
Mondi’s shares rose 4.8 percent to 145.50 rand at close in Johannesburg, the highest since Bloomberg began tracking the stock in 2007, valuing the company at 71 billion rand ($7.22 billion). Mondi has gained 58 percent this year, the fifth best-performing stock on the 166-company FTSE/JSE Africa All-Share Index.