Mondi Plc · LSE:MNDI
Mondi — FY2022 Earnings Presentation
34 slides from Mondi's earnings presentation, Feb 23, 2023
Slide 1: Full Year 2022 Results Presentation
Full Year 2022 Results Presentation Strong performance in 2022 Delivering our strategy 23 February 2023
Slide 2: Delivering growth and attractive returns sustainably
Delivering growth and attractive returns sustainably Strong performance in 2022 • Strong financial performance from continuing operations across all key metrics • Integrated business model and excellent operational delivery • Good progress made on our MAP2030 sustainability roadmap Accelerating grow
Slide 3: Delivering our strategy
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Slide 4: Strong financial performance across all key metrics
Continuing operations1 Strong financial performance across all key metrics Cash generated Underlying EBITDA Underlying EPS from operations ROCE € million € cents per share € million % +60% +78% +29% +980 bps 1,157 1,848 110.1 195.6 1,001 1,292 13.9 23.7 2021 2022 2021 2022 2021 2022 2021 2022 1. Con
Slide 5: Excellent operational delivery in challenging business environment
Continuing operations Excellent operational delivery in challenging business environment Underlying EBITDA development € million 2,342 (1,879) 176 (38) 90 1,157 1,848 2021 Sales Costs Sales Currency Forestry 2022 prices volumes effects fair value gain 5
Slide 6: Strong cash generation and further strengthened balance sheet
Continuing operations Strong cash generation and further strengthened balance sheet Movement in net debt € million 1.5x 0.5x Net debt to Net debt to underlying underlying EBITDA EBITDA 1,848 (419) (1,689) (1,011) (569) (323) 642 (321) (180) Net debt at Underlying Working Capital Tax and Dividends Fo
Slide 7: Strong liquidity profile to support our growth ambitions
Continuing operations Strong liquidity profile to support our growth ambitions Committed debt maturity profile € million ● Liquidity of €1.8 billion o €757 million undrawn committed debt facilities o €1,061 million net cash ● Average maturity of debt facilities – 3.8 years ● Leverage of 0.5 times ●
Slide 8: Russian operations
Russian operations ● Regulatory approval processes remain ongoing ● Agreements to divest operations during H2 2022: o Agreed to sell Syktyvkar to Augment Investments Limited for RUB 95 billion (€1.2 billion at 31 December 2022 exchange rate) o Subject to shareholder approval (Class 1 transaction) o
Slide 9: Disciplined capital allocation
Disciplined capital allocation Growing through selective capital investment opportunities Free cash flow Supporting payment of ordinary dividends to our shareholders priorities Evaluating growth opportunities through M&A and/or increased shareholder distributions While maintaining our strong and sta
Slide 10: Business Units
BUSINESS UNITS
Slide 11: Corrugated Packaging: Strong operating performance leveraging integrated platform
Corrugated Packaging % of Group Strong operating performance leveraging integrated platform EBITDA Underlying EBITDA and ROCE Continuing operations, € million and % ● Underlying EBITDA up 22% 25.3% 24.3% ● Containerboard volumes marginally up with softer 662 corrugated solutions demand compared to s
Slide 12: Flexible Packaging: Uniquely positioned to drive growth
Flexible Packaging % of Group Uniquely positioned to drive growth EBITDA Underlying EBITDA and ROCE Continuing operations, € million and % ● Underlying EBITDA up 41% 20.9% ● Volume growth supported by innovative and sustainable 797 packaging portfolio 15.2% o Kraft paper sales volumes up 4% 567 o St
Slide 13: Uncoated Fine Paper: Supplier of choice
Uncoated Fine Paper % of Group Supplier of choice EBITDA Underlying EBITDA and ROCE Continuing operations, € million and % ● Significantly improved underlying EBITDA 34.7% ● Ramp-up of rebuilt recovery boiler in Richards Bay (following project-related shut in H2 2021) 427 ● Lower uncoated fine paper
Slide 14: Delivering our strategy
Slide 15: Mondi has leading positions in growing and resilient markets
Mondi has leading positions in growing and resilient markets… Virgin containerboard (Europe) Kraft paper (global) Containerboard (emerging Europe) Paper bag producer (Europe) and a global leader Corrugated solutions (emerging Europe) Consumer flexible packaging (Europe) Industrial and ~70% ~50% Indu
Slide 16: Supported by focused investment
…supported by focused investment Five-year net investment of €1.3 billion Delivering greater focus on packaging 2018 – 2022 (%) 6% Corrugated ● Completed sale of Personal Care Components Packaging business for an enterprise value of €615 million Flexible 31% Packaging ● Simplifies our portfolio and
Slide 17: Disciplined investment through cycle for mid-teen returns
Disciplined investment through cycle for mid-teen returns Extending market leadership and scale Duino acquisition and Driving productivity conversion €240m Pulp and improvements paper mills €400m Enhancing customer offering €220m Pulp and paper mills Leveraging cost €190m advantaged asset base €185m
Slide 18: Driving the transition to a circular economy with our customers
Driving the transition to a circular economy with our customers Helping customers consider all packaging trade-offs including: Mono-material paper recyclable in paper stream Functionality Cost Quality End-of-life Hybrid solutions recyclable in paper stream Emissions Brand appeal Current Product prot
Slide 19: Mono-material paper – recyclable in the paper stream
Mono-material paper – recyclable in the paper stream ● Recyclable product portfolio for the fresh fruit industry ● New recyclable paper packaging for pasta products ● Designed to protect and transport fresh produce ● Provides same protection as previous plastic alternative ● Mono-material range enti
Slide 20: Hybrid solutions – reducing plastic content
Hybrid solutions – reducing plastic content ● Paper-based packaging for Finish dishwasher tablets ● Recyclable paper-based packaging for surimi sticks ● Replaces 75% of plastic used in previous packaging alternative ● Uses Mondi’s FunctionalBarrier Paper 95/5 ● Estimated to eliminate 2,000 tonnes of
Slide 21: Mono-material plastics – high barrier packaging
Mono-material plastics – high barrier packaging ● New high-barrier packaging solution for bacon ● Recyclable high-barrier packaging for dog and cat food ● Recyclable mono-material polypropylene (PP) solution ● Made from recyclable mono-material polyethylene (PE) ● Offers excellent protection to avoi
Slide 22: Engaged and empowered people sustain our long-term success
Engaged and empowered people sustain our long-term success Training, development Diverse & inclusive Safety & wellbeing & recognition workplace ● Mondi Diamond Awards celebrating ● Recognised as a Diversity Leader ● Building on a world class safety excellence – record number of in Europe in survey b
Slide 23: Long track record of delivery on sustainability
Long track record of delivery on sustainability… reduction since 20051 reduction since 20051 reduction since 20041 Total waste landfilled (tonnes) TRCR2 (per 200,000 hours worked) Total GHG emission reductions (continuing operations) (continuing operations) (including Russian operations) Circular dr
Slide 24: …and leadership in our industry
…and leadership in our industry External recognition Approved Net-Zero targets Sustainalytics Top 1% globally Ranked #1 in industry Top rating score achieved for Top score out of 78 companies in seven consecutive years paper and forestry industry A-list ‘AAA’ rating double A score for forestry and t
Slide 25: Well positioned to drive value accretive growth, sustainably
Well positioned to drive value accretive growth, sustainably Structural market Unique portfolio of Sustainable by Market leader growth innovative solutions design • Virgin containerboard • Sustainability firmly Sustainable packaging embedded across the (Europe) organisation • Containerboard • MAP203
Slide 26: Appendices
Slide 27: Mondi at a glance (2022)
Continuing operations Mondi at a glance (2022) Products Segment Underlying ROCE End uses revenue1 EBITDA Corrugated €2,991m Consumer €662m 25.3% and retail2 Packaging (34%) Flexible €4,299m €797m 20.9% Consumer and retail2 Packaging (48%) Uncoated Fine €1,613m Paper for €427m 34.7% printing Paper (1
Slide 28: Integrated value chain (2022)
Continuing operations Integrated value chain (2022) Pulp1 0.2 mt Wood Pulp 14.5 million m3 3.6 mt Containerboard1 1.4 mt Corrugated solutions 1.9 bn m2 Paper for Containerboard 2.4 mt Box plants recycling 1.3 mt Kraft paper1 0.4 mt Kraft paper 1.3 mt Paper bags 6.0 bn bags Consumer flexibles 2.0 bn
Slide 29: Cost advantaged asset base with focus on driving performance
Continuing operations Cost advantaged asset base with focus on driving performance Mondi capacity by quartile of relevant industry cost curve Relentless focus on driving performance (%) • Core organisation competence • Ongoing profit improvement initiatives across key areas including: ‒ Commercial ‒
Slide 30: Investment pipeline: Corrugated Packaging
Investment pipeline: Corrugated Packaging €125 million €95 million €240 million €185 million • 55,000 tonnes additional • 55,000 tonnes additional capacity • Acquisition and planned • Expanding in Poland, Germany, capacity conversion of existing paper Türkiye and Czech Republic • Rebuilding PM2 and
Slide 31: Investment pipeline: Flexible Packaging
Investment pipeline: Flexible Packaging €400 million €65 million ~ €50 million • 210,000 tonne kraft paper • Ramping up investments in Latin • Expanding capacity in Austria and • Developing advanced technologies machine America and north west Africa Germany to support the Group’s coating capabilitie
Slide 32: Technical guidance
Continuing operations Technical guidance 2023 Capital expenditure €800 – 850 million Depreciation and amortisation €400 – 425 million Estimated impact of planned mill maintenance shuts Similar to 2022 Working capital as a % of revenue 12 – 14% Effective tax rate 22 – 23% Net finance costs €130 – 150
Slide 33: Forward-looking statements disclaimer
Mondi: Forward-looking statements disclaimer This document includes forward-looking statements. All statements other than statements of historical facts included herein, including, without limitation, those regarding Mondi’s financial position, business strategy, market growth and developments, expe
Slide 34: Thank you!
¢mondi THANK YOU!