Mondi PLC on Thursday blamed production shutdowns and a loss on fair value of assets for a sharp decline in underlying profitability in the third quarter of 2024.

The Weybridge, England-based packaging firm reported a 36% slump in underlying earnings before interest, tax, depreciation, and amortisation to €223 million for the third quarter of 2024 from €351 million in the second quarter.

The company attributed the decline primarily to ‘more planned maintenance shuts’ and a forestry fair value loss. This was in addition to softer seasonal demand and higher input costs, it said.

Selling prices in corrugated packaging and flexible packaging were higher compared to the previous quarter due to the implementation of paper price increases earlier in the year, Mondi said.

After a recovery in pricing at the start of the year, pulp and paper selling prices in uncoated fine paper declined in the third quarter to September 30.

Chief Executive Officer Andrew King said trading conditions remain muted against the backdrop of an uncertain macroeconomic environment, while he group saw the benefits from the increase in prices earlier this year across its key paper grades.

In the fourth quarter of 2024, there will be fewer planned maintenance shuts, and the normal seasonal pick-up in demand is expected, King said.

‘Overall, our organic growth investments are expected to deliver a meaningful Ebitda contribution from 2025,’ he said.

The Mondi chief executive said expansionary projects remain on track, noting that the group is making good progress towards completing the paper machine investments at Steti mill in Czech Republic and Duino mill in Italy.

Mondi shares were down 6.9% to 1,294.50 pence each on Thursday morning in London, and they were down 5.9% to R 301.17 in Johannesburg.

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