Mondi Third-Quarter Profit Rises 25% Helped by AcquisitionsKamlesh Bhuckory
Mondi Ltd., South Africa’s biggest packaging company, posted a 25 percent gain in third-quarter profit as acquisitions and an increase in recycled containerboard prices helped offset stagnant economies.
Underlying operating profit increased to 172 million euros ($233 million) from 138 million euros, the company said in a statement today. Sales volumes, adjusted for acquisitions, were similar to last year and lower than the second quarter because of factory shutdowns for maintenance and seasonally weaker demand for uncoated fine paper.
Mondi is opening factories in China and Iraq as the Johannesburg-based company focuses on emerging markets to boost earnings. Mondi has spent about 1.6 billion euros on acquisitions since its spinoff from Anglo American Plc in 2007.
“The current low-growth environment, coupled with increased competition in certain areas of the business presents some challenges going into the new year,” the company said. “The outlook for 2014 remains dependent on the nature and extent of the macroeconomic recovery and related demand for the group’s key products.”
Mondi shares fell 3.7 percent to 175 rand at the close of trading in Johannesburg. The stock has surged 90 percent this year, valuing the company at about 85.5 billion rand ($8.34 billion).