Planned site shutdowns hit Q3 sales volumes at Mondi

6th Nov 2013 07:01

- Sales volumes flat year-on-year- Underlying profits up 25 per cent- Outlook cautious on macro concernsPackaging and paper group Mondi said that sales volumes in the third quarter were held back by planned maintenance shutdowns at some of its larger sites, though expectations for the full year remain unchanged.However, the company gave a cautious outlook, citing the "current low-growth environment" and rising competition in some markets.Adjusted sales volumes in the three months to September 30th were broadly in line with the previous year but below the second quarter due to the scheduled maintenance, in addition to seasonally weaker demand for uncoated fine paper. Mondi reiterated that the planned maintenance shuts will have a €50-60m negative impact on underlying operating profit in the second half compared with the first.Despite the weakness on the top line, underlying operating profit rose 25% year-on-year to €172m after "improved market conditions" in the Packaging Paper division and the South Africa region, along with benefits from acquisitions made the year before.As for the outlook, Mondi said that current macro conditions and increased competition in certain areas of the business "presents some challenges going into the new year". This firm said that these challenges would be countered by acquisition synergies, a capital expenditure programme and cost-cutting.It added: "Ultimately, the outlook for 2014 remains dependent on the nature and extent of the macroeconomic recovery and related demand for the group's key products."BC