FTSE 100-listed paper producer Mondi PLC (LSE:MNDI) fell nearly 9% after reporting a big drop in third-quarter profits amidst softer demand, higher costs and factory shut-downs for maintenance.
Underlying earnings for the quarter fell 37% sequentially to €223 million (£186 million), primarily attributed to more planned maintenance shuts and a forestry fair value loss, as well as softer seasonal demand and higher input costs.
Chief executive Andrew King said: “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.
“In the fourth quarter there will be fewer planned maintenance shuts, and we expect the normal seasonal pick-up in demand.”
King said Mondi’s expansionary project “remain on track” despite losing a bidding war for DS Smith earlier this year.
“Overall, our organic growth investments are expected to deliver a meaningful EBITDA contribution from 2025,” said King.
Together with the recently announced acquisition of cardboard box-making assets from Schumacher Packaging, he said the additional capacity “will ensure Mondi is well positioned to capitalise on the structural growth in sustainable packaging".