Mondi plans restructure as falling demand bites
Consequently, South African-based Mondi said it planned to restructure its coating and consumer packaging business further in the next quarter at an estimated cost of €6m.
Although Q3 operating profit for the South African based company stood at €136m up on the same quarter last year, it had fallen on the previous quarter due to a turbulent economic environment.
“This performance reflects the impact of the planned third quarter maintenance shuts, estimated to have negatively affected underlying operating profit by approximately €20 million,” the company said in its earnings release.
“Most emerging market currencies to which the group is exposed as a net exporter were slightly weaker against the euro when compared to the second quarter, providing a small positive contribution to the group’s performance,” it continued.
The firm’s uncoated fine paper business performed strongly, though annual maintenance shuts that took place during the quarter affected sales volumes.
Other areas of the company, such as Mondi’s bags and coatings business, were hit by falling demand, which has led the company to close some of its factories.
Earlier this month it shut down operations at its industrial bag facility in Aberdeen. It also sold its Unterland flexible packaging business to Sun European Partners LLP at a €4m loss.