Paper and packaging group Mondi Plc (LON:MNDI) reported first-half underlying profit before tax of €176m, up 117% from the previous €81m. Revenue in the six months to June 30 rose 16% to €3.0bn from €2.6bn. Underlying earnings per share were up from 8.3 €c to 20.3€c. The group raised its interim dividend 40% to 3.5 €c from 2.5 €c. The group said its result was driven by a strong performance from the Europe & International division. There was sustained improvement in order inflows, volumes and prices across all key paper grades. CEO David Hathorn said, 'Mondi achieved a pleasing result in the period against a backdrop of improving market conditions, supported by a particularly strong performance from the European Uncoated Fine Paper business.
'The outcome bears testament to our robust business model, which encompasses leading market positions in higher-growth emerging markets, low-cost operations and a relentless focus on performance.
'Despite cost pressures, the positive pricing momentum witnessed in Europe since the beginning of the fourth quarter of 2009 in most of the group's key grades should see the business continue to deliver a strong performance in the second half.
'The South Africa Division should benefit from the further management actions taken to improve profitability, although much depends on the outlook for the rand and export pulp prices.'
Restructuring of the European Corrugated business was completed. A major capital project in Russia was on schedule for completion in second half. Issue of an inaugural €500m eurobond in March was used to pay down existing debt. Net debt at June 30 increased from December 31 by €115m to €1.63bn.
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