Mondi (MNP) is a massive international paper and packaging company that started in South Africa but now has interests in 30 countries and employs 26,000 people at about 100 sites. It has businesses across the full spectrum of packaging and is extremely professionally managed. The company owns and operates forests, produces wood pulp, paper, and plastic films for the production of a wide variety of packaging solutions.
Mondi has been impacted by developments in the Ukraine crisis. In an update on 28th February 2022, the company said, "Mondi has operations in Russia, representing around 12% of the Group's revenue by location of production, including a high margin, cost-competitive, integrated pulp, packaging paper and uncoated fine paper mill located in Syktyvkar (Komi Republic)." The company decided to divest itself of all its Russian holdings, which had a net asset value (NAV) of 687 million euros as of 31st December 2021.
On 1st July 2022, the company announced that it had completed the sale of its personal care business for 615 million euros. On 12th August 2022, the company announced that it had sold its Russian subsidiary for about R25 billion. This announcement caused the share price to jump.
In its results for the six months to 30th June 2024, the company reported revenue down 4% and earnings per share (EPS) down 30%. The company said, "Our underlying EBITDA of €565 million in the first six months, although lower than the comparable period last year, reflected an encouraging performance, supported by improving market conditions resulting in stronger order books and higher sales volumes."
In our opinion, Mondi remains a blue-chip company that looks cheap on a price: earnings multiple (P:E) of 12.37; however, there may be further downward potential. Technically, the share was in a strong upward trend after March 2020, which was derailed by the Ukraine situation in March 2022. Since then, it has been moving sideways, but there is evidence now of a new upward trend emerging. We expect that the upward trend will continue as the worldwide switch to online shopping requires more packaging materials.
In March 2024, the company announced that it would acquire 54% of LSE-listed DS Smith Plc for GBP5.14 billion.
Mondi has been impacted by developments in the Ukraine crisis. In an update on 28th February 2022, the company said, "Mondi has operations in Russia, representing around 12% of the Group's revenue by location of production, including a high margin, cost-competitive, integrated pulp, packaging paper and uncoated fine paper mill located in Syktyvkar (Komi Republic)." The company decided to divest itself of all its Russian holdings, which had a net asset value (NAV) of 687 million euros as of 31st December 2021.
On 1st July 2022, the company announced that it had completed the sale of its personal care business for 615 million euros. On 12th August 2022, the company announced that it had sold its Russian subsidiary for about R25 billion. This announcement caused the share price to jump.
In its results for the six months to 30th June 2024, the company reported revenue down 4% and earnings per share (EPS) down 30%. The company said, "Our underlying EBITDA of €565 million in the first six months, although lower than the comparable period last year, reflected an encouraging performance, supported by improving market conditions resulting in stronger order books and higher sales volumes."
In our opinion, Mondi remains a blue-chip company that looks cheap on a price: earnings multiple (P:E) of 12.37; however, there may be further downward potential. Technically, the share was in a strong upward trend after March 2020, which was derailed by the Ukraine situation in March 2022. Since then, it has been moving sideways, but there is evidence now of a new upward trend emerging. We expect that the upward trend will continue as the worldwide switch to online shopping requires more packaging materials.
In March 2024, the company announced that it would acquire 54% of LSE-listed DS Smith Plc for GBP5.14 billion.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.