Half Year 2026 Mondi PLC Earnings Call Transcript
Key Points
- Higher sales volumes across most packaging businesses, driven by ramp-up of major capacity expansion projects and improved order books.
- Strong cash generation with cash from operations of EUR347 million, supported by tight working capital control and lower capital expenditure.
- Successful implementation of price increases across all key grades, with full benefits expected in Q3, supported by strong order books.
- Proactive cost control and operational excellence initiatives, including plant network optimization and the Mondi Management System, driving efficiency improvements.
- Robust financial position with liquidity of EUR1.15 billion, investment-grade credit rating, and no financial covenants, following successful refinancing.
- Underlying EBITDA declined to EUR379 million due to margin pressure from lower average selling prices and higher input costs.
- Significant input cost inflation, particularly in Central and Eastern European wood costs and energy, with further headwinds expected in H2.
- Recognized EUR320 million in special item charges, including a EUR296 million noncash impairment, mainly at the Duino mill due to lower returns profile.
- Forestry fair value loss of EUR35 million in the period, driven by reduced local wood prices in South Africa.
- Leverage increased to 3.2 times, driven by lower trailing EBITDA, and market conditions remain volatile with geopolitical uncertainties.
Good morning, everyone, and welcome to Mondi's 2026 half year results presentation. I'm Andrew King, your Group CEO, and I'm joined this morning by our CFO, Mike Powell. I'll begin with some key messages from the period under review, and then Mike will take you through the financial performance in more detail. I'll return to provide an update on the performance of our business units and discuss some of the current market dynamics before taking you through various of the actions we are taking to strengthen our competitive advantage in what remains a volatile market backdrop. After that, Mike and I look forward to taking your questions.
In the first half of 2026, we delivered underlying EBITDA of EUR379 million, down on the prior year due mainly to margin pressure from lower average selling prices and higher input costs. We were able to partially mitigate these pressures through higher sales volumes, strong cost control, and proactive pricing actions through the period.
We remain focused on
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