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UPDATE 1-South Africa's Mondi says results to miss expectations
October 11, 2017 / 9:02 AM / in 9 days

UPDATE 1-South Africa's Mondi says results to miss expectations

(Adds share price, adds trader quote)

JOHANNESBURG, Oct 11 (Reuters) - South African packaging and paper company Mondi said on Wednesday its full-year results would be slightly lower than analysts’ expectations due to cost pressures and adverse currency moves.

The company’s Johannesburg-listed shares fell as much as 9 percent to a one month low of 341.04 rand.

Mondi said underlying operating profit rose 8 percent to 245 million euros ($290 million) in the three months to Sept. 30, helped by higher selling prices.

But the company, which also operates in Europe, said its full-year underlying performance would “modestly” miss expectations due to currency moves, inflationary pressures and maintenance shutdowns.

It did not provide a figure for analysts’ expectations.

“The market was expecting a little bit more ... If they don’t hit the target that the market is expecting it’s considered a miss, then the market treats it rather badly,” said Independent Securities trader Ryan Woods.

Mondi said currency pressures were driven mainly by a weaker U.S. dollar and Turkish lira, which weighed on operating profit compared with the same period last year.

The company has operations in countries including Turkey, Russia, Poland, South Africa and the United States.

Mondi reported a drop in half-year profit in August after the valuation of its forestry assets in South Africa rose less than the year before and due to the impact of mill maintenance shutdowns.

$1 = 0.8455 euros Reporting by Tanisha Heiberg; Editing by Jason Neely and Mark Potter

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