Mondi Group - HALF-YEARLY RESULTS FOR THE …...6 1 Underlying operating profit is operating profit...

HALF-YEARLY RESULTS FOR THE

SIX MONTHS ENDED 30 JUNE 2012

7 August 2012

2

Agenda

Highlights

Financial overview

Operational overview

Capital allocation

Summary

Appendices

3

Highlights

Good operating performance after a

challenging start to the year

Return on Capital Employed of 13.3%,

above through-the-cycle target of 13%

Interim dividend of 8.9 euro cents per

share, up 8%

Strong cash generation of €353 million

Significant strategic acquisitions

Świecie minorities acquired for

€296 million

Świecie power plant acquired for

€88 million

€655 million acquisition of Nordenia

agreed

354 268 269

12.0%

9.6% 9.5%

H1 2011 H2 2011 H1 2012

€ million

EBIT margin %

195 145 149

38.2

29.9 30.9

H1 2011 H2 2011 H1 2012

€ million

€ cents per share

Underlying earnings

Underlying operating profit

4

Agenda

Highlights

Financial overview


Capital allocation

Summary

Appendices

5

Operating financial highlights

1 Underlying EBITDA is operating profit of subsidiaries and joint ventures before special items, depreciation and amortisation, excluding Mpact 2 Underlying operating profit is operating profit from continuing operations before special items 3 Group return on capital employed (ROCE) is an annualised measure based on underlying operating profit plus share of associates net earnings divided by average trading capital employed before impairments and adjusted for major capital projects not yet commissioned

€ million

H1

2011

H2

2011

H1

2012

% change

vs

H1 2011

% change

vs

H2 2011

Group Revenue 2,942 2,797 2,840 -3% +2%

Underlying EBITDA1

526 438 436 -17% -

% Margin 17.9% 15.7% 15.4%

Underlying operating profit2

354 268 269 -24% -

% Margin 12.0% 9.6% 9.5%

Basic underlying earnings per share (€ cents) 38.2 29.9 30.9 -19% +3%

Working capital cash flows (143) 75 (102)

Cash generated from operations 403 514 353 -12% -31%

Net debt (1,200) (831) (1,273) -6% -53%

Group ROCE3

15.2% 15.0% 13.3%

6

1 Underlying operating profit is operating profit of subsidiaries and joint ventures before special items 2 Capital employed as at 30 June 2012

105

128 118

27

(5)

73

100

87

35

(13)

65

96 100

29

(3)

-40

-20

0

20

40

60

80

100

120

140

Corrugated Bags & Coatings Uncoated Fine Paper

South Africa division

Newsprint

€ million H1 2011

H2 2011

H1 2012

Divisional underlying operating profit¹

Capital employed2 1,087 1,347 1,270 840 66

7

1 Other variable costs comprise mainly 70% Chemical costs and 15% Packaging costs

0

100

200

300

400

500

600

Pulp Paper Wood Recovered paper

Energy Variable selling expenses

Other variable costs

€ million

H1 2011 H2 2011 H1 2012

Input costs

Average benchmark pulp prices lower than H1 2011 by 7% in euro terms

Wood costs lower than H1 2011, but higher than H2 2011

Average benchmark recovered fibre costs ±10% lower than H1 2011 and ±6% lower than H2 2012

Higher energy costs than H1 and H2 2011 mainly due to higher gas prices

Lower chemical input costs

¹

Variable costs

8

0

100

200

300

400

500

600

700

800

900

H1 2011 H2 2011 H1 2012

€ million

Personnel costs Depreciation and amortisation Maintenance and other indirect costs Other net operating expenses

Fixed costs

Continued focus on cost management

Overall fixed costs up only marginally on 2011

Fixed costs composition

21.5% 22.7% 22.5%

Fixed costs as a % of revenue excluding depreciation

9

Financial review

1 Underlying operating profit is operating profit from continuing operations before special items

€ million

H1

2011

H2

2011

H1

2012

% change

vs

H1 2011

% change

vs

H2 2011

Underlying operating profit1

354 268 269 -24% -

Net finance costs (60) (51) (53) +12% -4%

Net income from associates 2 (1) 1

Underlying profit before tax 296 216 217 -27% -

Tax before special items (59) (43) (43)

Total non-controlling interest (42) (28) (25)

Underlying earnings from continuing operations 195 145 149 -24% +3%

Special items (after tax and minorities) 4 (57) 4

Profit from discontinued operation - Mpact 13 30 -

Reported profit after tax and minority interests for

total operations 212 118 153 -28% +30%

10

Net debt and finance costs

Net finance costs marginally higher than H2 2011 due to foreign currency losses

Average net debt only marginally down on H2 2011 after acquisition of Świecie minority

interest and power plant in Q2

€ million

H1

2011

H2

2011

H1

2012

% change

vs

H1 2011

% change

vs

H2 2011

Net debt (1,200) (831) (1,273) -6% -53%

Net debt finance charges and other financial income 58 53 50 +14% +6%

Foreign currency losses / (gains) 2 (2) 3

Net finance costs 60 51 53 +12% -4%

Effective interest rate (before capitalised interest) 8.3% 9.0% 9.0%

11

Taxation and non-controlling interests

Consistent with 2011 levels, due to

ongoing benefits from favourable profit

mix

ongoing benefits from investment

incentives, notably Poland

Lower profitability in the Świecie and

Ružomberok mills

Acquisition of Mondi Świecie S.A. non-

controlling interest in May/June 2012

Taxation

€ million

H1

2011

H2

2011

H1

2012

Underlying tax charge 59 43 43

Tax on special items - (2) 2

Taxation charge 59 41 45

Underlying effective tax rate 20% 20% 20%

Non-controlling interests

€ million

H1

2011

H2

2011

H1

2012

Non-controlling share before special

items 42 28 25

Non-controlling share of special

items - - -

Profit attributable to non-controlling

interests 42 28 25

12

Cash flow

1 Including Mpact cash flows 2 Includes net debt assumed and the impact of the acquisition of non-controlling interests 3 Includes net debt disposed of

€ million

H1

2011

H2

2011

H1

2012

% change

vs

H1 2011

% change

vs

H2 2011

Underlying EBITDA 526 438 436 -17% -

Working capital movements (143) 75 (102)

Other operating cash flow items1

20 1 19

Cash generated from operations 403 514 353 -12% -31%

Dividends from financial investments and associates - 2 -

Taxes paid (45) (40) (45)

Net cash inflow from operating activities 358 476 308 -14% -35%

Capital expenditure (127) (141) (112)

Investment in forestry assets (23) (19) (29)

Proceeds on sale of fixed assets and other items 12 2 (1)

220 318 166 -25% -48%

Acquisitions2

(16) (4) (384)

Disposals3

14 216 1

Net cash flow after investing activities 218 530 (217)

13

527 660 702 575 718

10.0% 9.9%

11.9%

10.0%

12.6%

2009 2010 H1 2011 H2 2011 H1 2012

€ million

Working capital as % of turnover

Working capital

Working capital above target range of 10% to 12% of revenue

Scheduling of planned maintenance shuts

Normal seasonal pick-up in first half

Anticipate H2 2012 release of working capital

(141)

20

(143)

75

(102)

H1 2010 H2 2010 H1 2011 H2 2011 H1 2012

€ million

Working capital cash flows Working capital management

12%

10%

14

317 383 295 227 185 209 126 137 109 0%

50%

100%

150%

200%

250%

0

50

100

150

200

250

300

350

400

H1 2008 H2 2008 H1 2009 H2 2009 H1 2010 H2 2010 H1 2011 H2 2011 H1 2012

€ million

Capital expenditure excl. intangible assets Capex as % of depreciation

Capital expenditure

Capital expenditure at 67% of depreciation

Good progress on energy related investments

Pulp dryer in Syktyvkar on hold

Expect full year capex of ±90% of depreciation

15

Debt facilities and net debt

Net debt increased by €442 million mainly due to

Seasonal working capital outflows

Acquisition of non-controlling interest in Mondi Świecie S.A. of €296 million

Acquisition of Saturn Management of €88 million

Usual bias towards H1 of cash outflows from financing activities

Long-term investment grade credit ratings reaffirmed

Baa3 (Moody’s Investor Services)

BBB- (Standard & Poor’s)

In July, secured a new two-year €250 million committed bank debt facility to fund the proposed acquisition of Nordenia International AG

€ million

H1

2011

H2

2011

H1

2012

Net debt (1,200) (831) (1,273)

Gearing (Net debt / Trading capital employed) 27% 22% 31%

Net debt / 12 month trailing EBITDA (times) 1.3 0.8 1.5

Committed facilities 1,897 1,839 1,795

Of which undrawn 781 889 584

16

7.7 2.5

3.5 8.25 8.9

5.0

7.0 16.5

17.75

-

5.0

10.0

15.0

20.0

25.0

30.0

2008 2009 2010 2011 2012

€ cents per share

Interim Dividend Final Dividend

Dividends

Interim dividend of 8.9 euro cents per share, up 8%

Record date – 24 August 2012

Payment date – 18 September 2012

12.7

9.5

20.0

26.0

0.0

17

Packaging

Paper

Fibre

Packaging

Consumer

Packaging2

UFP

New Europe & International Management

and Reporting Structure¹

1 Subject to completion of Nordenia acquisition 2 Excluding Unterland

€ million

H2

2011

H1

2012

H2

2011

H1

2012

H2

2011

H1

2012

H2

2011

H1

2012

Sales 943 960 908 946 142 150 695 749

EBITDA 168 150 72 80 16 15 140 154

EBIT 122 104 40 47 10 10 87 100

Net Segment Assets 1,249 1,373 866 916 131 145 1,283 1,270

Containerboard Corrugated

Packaging Consumer Bags UFP

Former Bags & Coatings business

Former Corrugated business Kraft paper Industrial Bags Nordenia

Coatings

18

Agenda

Highlights

Financial overview


Capital allocation

Summary

Appendices

Corrugated | Bags & Coatings | Uncoated Fine Paper | South Africa Division

19

105 73 65

14.9%

10.7% 9.6%

H1 2011 H2 2011 H1 2012

€ million

EBIT margin %

Corrugated

Significantly lower average containerboard

selling prices than H1 and H2 2011

Containerboard sales volumes marginally

up on H1 2011

Fibre and energy input costs lower than H1

and H2 2011

Planned maintenance shut for Świecie in

July 2012

Price increases announced in July for all

containerboard grades

Corrugated packaging significantly

improved

product mix improvements

lower paper input costs than H1 2011



20

0.50

0.60

0.70

0.80

0.90

1.00

1.10

1.20

1.30

1.40

1.50

2007 2008 2009 2010 2011 2012

Kraftliner - indexed

White-top Kraftliner - indexed

RCB / Recovered paper differential - indexed

Price indexed vs 2007 opening levels

Corrugated | industry fundamentals

Demand

Sluggish short-term growth due to macro-

economic slowdown

Structural growth drivers in place

Supply

Kraftliner

Peterson bankruptcy - ±8% of European

Kraftliner capacity closed

Production interruptions at key

competitor

Strong US dollar limiting imports

Recycled containerboard

Net supply expansion (± 1.5 million

tonnes in 2012 to 2014)

Selling prices - indexed


21

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

€/tonne

Unbleached sack kraft Average

128 100 96

9.7%

8.6% 8.3%

H1 2011 H2 2011 H1 2012

€ million

EBIT margin %

Bags & Coatings

Kraft paper

Commercial downtime ended in Q1 with full

production in Q2

Lower average selling prices than H1 and

H2 2011, although price increases

announced to take effect in H2 2012

Lower wood and pulp input costs

compared to H1 2011

European demand

stable in northern and eastern Europe

weak in southern Europe (17% of kraft

paper revenue)

Export markets remain strong, driven by

Underlying demand growth

Supply contraction



Unbleached sack kraft prices

22

Bags & Coatings

Industrial Bags

Selling prices in line with H1 2011

Demand weaker, especially in southern

Europe

Business benefited from

lower paper input costs than H1 2011

on-going focus on fixed costs savings

Coatings

Coatings experienced lower sales prices

and volumes than H1 2011

Negative impact of restructuring activities

start-up of new US facility

related relocation of activities and

closure of old site

Consumer packaging

Stable profitability from continuing

operations

Benefited from stable demand

Improved product mix

Higher resin prices successfully passed on

to customers, short-term margin squeeze


23

118 87 100

16.1%

12.5% 13.4%

H1 2011 H2 2011 H1 2012

€ million

EBIT margin %

Uncoated Fine Paper

Continued strong performance

Planned maintenance shut at Syktyvkar

during June 2012 compared to July 2011

Marginally lower average selling prices

than H1 and H2 2011

Lower pulp and chemical costs, offset by

higher energy costs across all mills

compared to H1 2011

Neusiedler and Ružomberok shuts in Q3

as normal



24

100

200

300

400

500

600

700

800

600

650

700

750

800

850

900

€/tonne €/tonne

A4 B-copy €/ton

Pulp (BHKP) - EUR/tonne (RHS)

Uncoated Fine Paper | industry fundamentals

Demand

Western Europe impacted by both short-

term cyclical pressures and ongoing

structural decline

Emerging Europe and Russia softer in light

of macroeconomic downturn, still enjoy

structural growth

Supply

Around 700 ktpa closures for 2012

Only new capacity expected in Russia (Ilim

pulp ±150 ktpa UFP)


Pulp and A4 B-copy prices

2007 2008 2009 2010 2011 2012

A4 B copy – €/tonne

Pulp (BHKP) – €/tonne (RHS)

25

27 35 29

10.0% 11.7%

10.1%

H1 2011 H2 2011 H1 2012

€ million

EBIT margin %

South Africa Division

Underlying operating profit marginally

higher than H1 2011

Richards Bay shut in Q3 2012 (Q2 in

prior year)

Lower average selling prices for pulp and

white top containerboard

Business benefited from

– increase in production and sales volumes

– lower operating costs

– weaker South African rand

Continued focus on domestic market and

improved operating performance

Further land claim settlements



26

Agenda

Highlights

Financial overview


Capital allocation

Summary

Appendices

27

Delivering against free cash flow

priorities

Maintain investment grade credit metrics Ratings reaffirmed during period

Selective capital investment opportunities,

mainly around cost optimisation

Good progress on energy projects

Syktyvkar pulp dryer on hold

Support dividends Interim dividend increase of 8%

M&A and/or increased shareholder

distributions, as appropriate

Świecie non-controlling interests acquired

Saturn energy power plant acquired

Proposed acquisition of Nordenia

28

Nordenia acquisition | highlights

Acquisition of 93.9% of Nordenia for implied enterprise value of €655 million

Combination creates a leading consumer packaging business

Significant cost and revenue synergy opportunities

By 2014, double digit underlying EPS enhancing¹ and beats Mondi’s through-the-cycle

ROCE target

Expected completion in Q4 2012

1 Mondi’s 2011 underlying earnings used as basis for calculation

29

30

99

129

Mondi CP Nordenia Combined

€ million

Nordenia acquisition |

a leading consumer packaging business

1 Pro forma Mondi Consumer Packaging business historical revenues, EBITDA and ROCE excluding Unterland

281

524

1,162

357

Mondi CP Nordenia Combined

€ million

25 29 30

15%

18% 17%

2009 2010 2011

€ million

EBITDA ROCE

A significant step for Mondi’s existing CP business

Mondi CP track record¹

Acquisition of

Nordenia

Acquisitions of:

Korneuburg (Austria)

Solec (Poland)

Békéscsaba (Hungary)

Acquisition of Wheatley (UK)

and Lindlar (Germany)

Acquisition of Napiag and

Unterland (Austria)

Divestiture of minority

interest (40%) in

Bischof und Klein

Acquisition of 40%

stake in Bischof und

Klein

Divestiture of Unterland

(Austria)

2000 2002 2007 2012 1995 2004 2011

Pro forma combined CP revenue¹ (2011)

Hygiene

components

Consumer

packaging

Pro forma combined CP EBITDA¹(2011)

30

Agenda

Highlights

Financial overview


Capital allocation

Summary

Appendices

31

Summary

Good financial performance – delivering ROCE of 13.3%

Significant strategic acquisitions

Świecie minorities acquired for €296 million and Saturn Management for €88 million

€655 million acquisition of Nordenia agreed

Investment grade credit ratings reaffirmed

Outlook

Macroeconomic environment remains a concern

Continued soft demand in certain western European markets

Demand in emerging markets remains firm

Positive supply side fundamentals

32

Agenda

Highlights

Financial overview


Capital allocation

Summary

Appendices

33

Abridged income statement

€ million

H1

2011

H2

2011

H1

2012

% change

vs

H1 2011

% change

vs

H2 2011

Group Revenue 2,942 2,797 2,840 -3% +2%

Materials, energy and consumables used (1,528) (1,470) (1,500)

Variable selling expenses (257) (254) (264)

Gross margin 1,157 1,073 1,076 -7% -

Maintenance and other indirect expenses (133) (139) (124)

Personnel costs (417) (391) (413)

Other net operating expenses (81) (105) (103)

EBITDA 526 438 436 -17% -

Depreciation and amortisation (172) (170) (167)

Underlying operating profit 354 268 269 -24% -

Net income from associates 2 (1) 1

Net finance charges (60) (51) (53)

Profit before tax 296 216 217 -27% -

Taxation charge (59) (43) (43)

Profit after tax 237 173 174 -27% -

Total non-controlling interest (42) (28) (25)

Underlying earnings 195 145 149 -24% +3%

34

Production volumes

Production statistics

H1

2011

H2

2011

H1

2012

Europe & International

Containerboard Tonnes 991,970 1,018,014 1,042,937

Kraft Paper Tonnes 535,238 420,503 489,279

Corrugated Board and Boxes M m2 609 604 606

Industrial Bags M units 2,050 1,908 2,005

Coatings and Release liners M m2 1,797 1,560 1,758

Consumer Packaging M m2 373 329 376

UFP Tonnes 712,886 688,105 715,575

Newsprint Tonnes 97,931 101,406 98,936

South Africa

Containerboard Tonnes 126,516 131,164 132,251

UFP Tonnes 114,686 119,151 129,337

External Hardwood pulp Tonnes 128,882 191,935 161,379

Woodchips (bone dry) Tonnes 101,454 104,696 68,632

Newsprint JV's (attributable share)

Aylesford Tonnes 95,955 92,581 96,509

Mondi Shanduka Newsprint Tonnes 61,548 63,366 58,770

35

Exchange rates

H1

2011

H2

2011

H1

2012

Closing rates against the euro

South African rand 9.86 10.48 10.37

Pounds sterling 0.90 0.84 0.81

Czech koruna 24.34 25.79 25.64

Polish zloty 3.99 4.46 4.25

Russian rouble 40.40 41.77 41.37

Turkish lire 2.35 2.44 2.28

US dollar 1.45 1.29 1.26

Average rates for the period against the euro

South African rand 9.69 10.50 10.29

Pounds sterling 0.87 0.87 0.82

Czech koruna 24.35 24.83 25.16

Polish zloty 3.95 4.29 4.24

Russian rouble 40.14 41.61 39.69

Turkish lire 2.21 2.46 2.34

US dollar 1.40 1.38 1.30

36

12.9%

17.1%

7.5%

2.6%

0.4%

6.5%

11.9%

18.1% 21.9%

15.0%

13.3%

2007 2007 2008 2008 2009 2009 2010 2010 2011 2011 2012

H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1

0

100

200

300

400

500

600

700

0%

5%

10%

15%

20%

25%

2007 2007 2008 2008 2009 2009 2010 2010 2011 2011 2012

H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1

€/tonne % ROCE

ROCE % Kraftliner RB Fluting-OCC differential

Corrugated | performance history

Mondi’s ROCE (%), kraftliner price and RB fluting – OCC price differential (€/tonne)

Kraftliner (€/tonne)

37

11.9%

10.9%

15.3%

7.0% 6.7%

8.3%

10.2% 13.3%

21.4%

16.5% 16.6%

2007 2007 2008 2008 2009 2009 2010 2010 2011 2011 2012

H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1

500

550

600

650

700

750

800

850

900

0%

5%

10%

15%

20%

25%

2007 2007 2008 2008 2009 2009 2010 2010 2011 2011 2012

H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1

€/tonne % ROCE

ROCE % Unbleached sack Kraft (€/tonne)

Bags & Coatings | performance history

Mondi’s ROCE (%), sack kraft (€/tonne) and indexed bags prices

Bags prices (indexed)

38

8.0% 8.4%

12.1%

10.5%

13.8% 15.2%

19.7%

14.4%

18.9%

14.4%

17.1%

2007 2007 2008 2008 2009 2009 2010 2010 2011 2011 2012

H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1

700

720

740

760

780

800

820

840

860

880

900

0%

5%

10%

15%

20%

25%

2007 2007 2008 2008 2009 2009 2010 2010 2011 2011 2012

H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1

€/tonne % ROCE

ROCE % A4 B-copy

Uncoated Fine Paper | performance history

Mondi’s ROCE (%), Uncoated fine paper price (€/tonne)

A4 B-copy (€/tonne)

39

Emerging market asset base leads to low cost

positions across the group’s main grades…

1 Delivered to Frankfurt except where noted 2 Delivered to Rotterdam 3 Includes specialties Source: RISI and Mondi estimates

Percentage of Mondi's capacity in overall cost curve at Q1 2012

Delivered cost¹ Q1 Q2 Q3 Q4

Unbleached Sack Kraft Paper 24% 15% 43% 18%

NSSC Fluting 100% - - -

Unbleached Kraftliner 100% - - -

White Top Kraftliner 100% - - -

BHKP (Pulp)² - 100% - -

Recycled fluting 75% 25% - -

UFP (all - RISI) 35% 38% 25%3

2%3

40

0.6

0.3

0.3 0.0

0.1

0.2

0.3

0.4

0.5

0.6

Production Consumption Net long position

Millions of tonnes E&I

0.5

0.1

0.4

0.1 0.1

0.0 0.1 0.2 0.3 0.4 0.5 0.6 0.7


Millions of tonnes

E&I SAD

0.5

0.3

0.2 0.0

0.1

0.2

0.3

0.4

0.5

0.6


Millions of tonnes E&I

1.5 1.7

(0.2)

0.4 0.1

0.3

(0.5)

0.0

0.5

1.0

1.5

2.0

2.5

Production Consumption Net long/(short) position

Millions of tonnes

E&I SAD

Integrated value chain 20121

Kraft Paper Pulp

Virgin Containerboard Recycled Containerboard

1 Based on H1 2012 production volumes

41

Nordenia acquisition

17,000m² Hubble Creek building in

Jackson, Missouri, USA

42

32%

24% 12%

16%

12% 4%

Germany

Western Europe excl Germany

North America

Central and Eastern Europe

Asia/Pacific

Other

An innovative consumer packaging

solutions provider

1 Expected to be operational by early 2014 2 2011 EBITDA adjusted for implied factoring facility interest of €1 million 3 Revenue by destination for 2011

Nordenia is an international supplier of innovative consumer packaging solutions and hygiene components

Competitive advantage through proprietary technology and customer-focused innovation

International presence with 12 fully invested operating facilities located in 7 countries across Europe, North America and Asia; plant in China under construction¹

Operations in Central Europe, Russia and Asia provide access to low-cost production and high-growth emerging markets

Blue chip customer base and relationships of 19 years on average with top 10 customers

Strong, stable management with proven track record of successfully developing and expanding Nordenia’s operations

Over 90% of revenues in FMCG, giving resilience in a downturn

2011 turnover of €881 million, EBITDA² of €99 million

Production facilities

Nordenia plant

Serving customers worldwide³

43

Material cost synergies

Operational

excellence

Procurement

Central

40%

Productivity

benefits

Plant

optimisation

35%

External

purchasing

Sourcing film

internally

25%

Operations

Systems

€15 million p.a. pre-tax by 2014

44

A complementary product portfolio

Consumer packaging Hygiene components

Nordenia

Advanced films Re-closable bags and

stand-up pouches Lamination Diaper components

Feminine hygiene release liner

• Advanced films for labels,

surface protection and

lamination as well as high

barrier films, predominantly

for use in FMCG packaging

• Pre-made, re-closable

bags for use in FMCG

packaging

• NorSpout bag (an

alternative to conventional

bottles) for use in FMCG

packaging

• Printed laminates to

improve shelf-life,

convenience, freshness

and sterility of FMCG for

customers

• Film based elastic

components (back ear

laminates)

• Fastening systems

• Film based release liner

for feminine hygiene

products

Mondi

Advanced films Re-closable bags and

stand-up pouches Lamination P&G relationship

Feminine hygiene release liner

• Advanced films and high

barrier films for FMCG

packaging

• Complementary product:

release liner for labels

• Pre-made re-closable

bags and stand-up

pouches for use in FMCG

packaging

• Printed laminates and

barrier materials to

ensure long shelf-life and

freshness of FMCG for

customers

• Mondi has a strong

existing relationship with

P&G, supplying release

liner, consumer

packaging and

corrugated packaging

• Paper based release liner

for feminine hygiene

products

http://www.mondigroup.com/products/desktopdefault.aspx/tabid-1600

45

Acquisition and financing structure

Acquisition EV of €655 million (100% basis), including assumption of €280 million bond and

€118 million other debt and debt-like liabilities¹

€242 million cash funding requirement for acquisition of 93.9% shareholding financed by a

new two year €250 million committed facility. Minorities squeeze out available

€280 million Nordenia bond

Coupon of 9.75% and due 2017

Significant headroom on undrawn committed facilities if bond holders decide to exercise

put option

Option to repay early subject to make-whole premium payable up to July 2014

Mondi expects to maintain its investment grade credit ratings post transaction

Baa3 / BBB-

Pro forma 2011 net debt/EBITDA² of 1.7x

Post transaction, undrawn committed facilities in excess of €500 million

Mondi dividend policy unchanged: 2-3x cover through-the-cycle

1 Debt at book value. Debt-like liabilities include factoring debt, pension liabilities and certain other net financial liabilities 2 Pro forma net debt / EBITDA based on 2011 reported financials adjusted for the full year effects of the acquisitions of Świecie minorities and Nordenia

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Products

H1 2012

EBIT %²

H1 2012

Revenue1

Packaging

Paper

Fibre

Packaging

Consumer

Packaging

UFP

South Africa

Newsprint

Mondi at a glance

1 Segment revenues, including inter-segment revenues. 2 EBIT % is before special items

10.8% 5.0% 6.7% 13.4% 10.1% (3.6%)

30%

30% 5%

23%

9% 3%

€960m €946m €150m €749m €287m €83m

http://www.mondigroup.com/products/desktopdefault.aspx/tabid-1213/

http://www.mondigroup.com/products/desktopdefault.aspx/tabid-1807




47

Focus on Packaging and UFP

in emerging markets1

Emerging

markets

Mature

markets

1 Mondi June 2012 data

Revenue

by destination

Revenue

by origin

Net

operating assets

Revenue by

product

52% 48%

57% 43%

71%

29%

85%

15% 32%

24% 24%

5%

5%

Fibre packaging

products

Packaging

paper

Uncoated

fine paper

Consumer

packaging

products

Pulp

Newsprint

Other

5% 5%

Mondi Group - HALF-YEARLY RESULTS FOR THE …...6 1 Underlying operating profit is operating profit...

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