Mondi third quarter operating profit up 27%

Underlying profit increased to €221m from €174m a year earlier and the company noted strong incremental contributions from Packaging Paper, Uncoated Fine Paper and the South Africa division.

“The group continues to deliver strongly, benefiting from stable to higher selling prices in a number of key grades and the contributions from its capital investment programme,” it said.

Mondi said selling prices in local currency terms for most of the group’s key paper grades were generally stable to higher versus both the second quarter and the comparable prior year period.

Like-for-like sales volumes were up on the comparable prior year period with the exception of kraft paper, which was hit by softer demand in certain export markets and the closure of the Lohja plant in the first half.

Among the key input costs, wood, energy and chemical costs remained stable in local currency terms, while average benchmark European paper for recycling costs rose by 13% over the previous quarter.

Mondi said there was a mixed impact in the period from currencies to which it is exposed, with the South Africa division benefiting from the weaker rand against the US dollar and the euro while the weakening of the Russian rouble had a negative impact on profits from the domestically-focused uncoated fine paper business.