Mondi plc, a leading global player in sustainable packaging and paper production, confronted persistently challenging market conditions in the third quarter of 2023. The company’s trading update, released today, revealed the impact of a weak macro-economic environment on its operations.
In the face of soft market demand and stable containerboard prices, Mondi reported a reduced underlying EBITDA of €261 million in Q3 2023, compared to €329 million in the previous quarter. The decline was attributed to lower average selling prices, partially offset by decreased input costs and effective fixed cost control strategies. Notably, the forestry fair value gain, accounted for within Uncoated Fine Paper, plummeted to €14 million in Q3 2023, significantly lower than the €72 million recorded in Q2 2023.
Financial Insights:
Financial Metrics | Q3 2023 (in € million) | Q2 2023 (in € million) |
---|---|---|
Underlying EBITDA | 261 | 329 |
Forestry Fair Value Gain | 14 | 72 |
Exchange Rate: €1 = R20.10
Andrew King, Chief Executive Officer, acknowledged the subdued market demand and reiterated the company’s commitment to resilience. He mentioned the stabilization of input costs and an increased impact from maintenance and project-related shutdowns in the coming quarter. King expressed confidence in Mondi’s low-cost asset base, diverse product offerings, and fully integrated business model, which position the company to thrive when market conditions improve.
Despite the challenges, Mondi remains optimistic about the future. The company’s €1.2 billion expansionary capital projects pipeline, which is progressing as planned and within budget, reflects their dedication to future growth. Furthermore, Mondi’s focus on sustainability aligns with the growing demand for eco-friendly packaging solutions. The company is investing in circular-driven solutions, aiming to create a positive impact on climate change.
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