February 23, 2017 / 7:50 AM / 3 years ago

Paper maker Mondi's 2016 profit rises, see challenges ahead

A general view of the Mondi paper factory is seen in Merebank, Durban November 29, 2011. REUTERS/Siphiwe Sibeko/File Photo

Johannesburg (Reuters) - South African paper and packaging company Mondi’s MNDJ.J 2016 underlying profit rose, helped by good performance in all its businesses despite pricing pressure in a number of key paper grades.

Mondi, which is also listed in London (MNDI.L), said underlying operating profit rose 3 percent to 981 million euros ($1 billion)in the full-year to end December from 957 million euros in the previous year.

Group revenue was down 2 percent to 6.6 billion euros (5.60 billion pounds)due to the impact of currency movements.

“We anticipate a more challenging trading environment in certain uncoated fine paper markets following price erosion in Europe over the course of 2016, combined with emerging market currency volatility,” Chief Executive David Hathorn said.

The paper and packaging firm declared a dividend of 38.19 euro cents per share.

Shares in Johannesburg-listed Mondi were down 1.87 percent at 294.38 rand.

($1 = 0.9482 euros)

Reporting by Nqobile Dludla

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