Mondi shares rise despite interim loss on low prices, high input costs

Mondi PLC on Thursday cut its interim dividend after swinging to a loss, as the packaging firm coped with lower prices and higher input costs, partly due to the Middle East conflict.

However, Mondi shares rose 13% to 888.20 pence each in London by late Thursday morning and by 14% to ZAR197.74 in Johannesburg at midday, as the company reported improved trading momentum throughout the half-year.

The Weybridge, England-based company reported a pretax loss of EUR240 million for the six months that ended June 30, swung from a pretax profit of EUR247 million a year earlier. This was despite revenue rising 1.8% to EUR3.98 billion from EUR3.91 billion.

Mondi booked a special items pretax charge of EUR320 million for impairments and restructuring in the recent period.

What's more, input costs rose during the first half, with wood cost increases in Central and Eastern Europe, as well as the impact of higher energy, other raw material and logistics costs as a result of the conflict in the Middle East.

Underlying earnings before interest, tax, depreciation and amortisation declined 33% to EUR379 million from EUR564 million, as higher input costs and lower average selling prices weighed.

Davy Research noted that the adjusted Ebitda result was in line with market consensus of EUR277 million, as cited by Visible Alpha.

Mondi said sales prices across its paper grades declined in the second half of 2025 and into early 2026.

Basic loss per share was 57.8 euro cents, flipped from basic earnings per share of 38.6 cents. Basic headline EPS plunged 85% to 5.4 cents from 37.2 cents.

In response, the company reduced its interim dividend to 9.42 euro cents per share, down from 23.33 cents.

"During the first half of 2026, we made good progress in delivering actions to strengthen Mondi's performance, cash generation and competitiveness, supported by the strength of our quality product offering, high service levels and the agility and commitment of our people," Mondi Chief Executive Officer Andrew King said.

Looking forward, King said, "trading momentum improved through the first half, and the company enters the second half with higher packaging paper prices, supported by good order books."

Davy said it expects to bring its forecast for adjusted Ebitda in 2026 to within a range of EUR830 million to EUR840 million.

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