Paper and packaging group Mondi reported a 70% decline in first-half underlying pre-tax profit on Thursday as margins were hit by disruptions linked to the Iran war, and booked €320-million ($366.2-million) in charges on its mills.
The packaging industry has faced a difficult operating environment over the past year, with weak demand across key segments and higher energy, raw material and shipping costs due to the prolonged Middle East conflict pressured profitability.
Mondi's underlying pre-tax profit fell sharply to €80-million ($91.6-million) in the six months ended June 30, from €272-million a year earlier, while the earnings before interest, taxes, depreciation and amortisation margin narrowed to 9.5% from 14.4% a year earlier.
The company, which operates across Europe, North America and Africa, said it took a €206-million impairment charge at its Duino recycled containerboard mill in Italy, whose performance was hit by overcapacity, trade barriers on key export markets, and higher energy costs.
