Packaging manufacturer Mondi (Vienna; www.mondigroup.com) has decided it will no longer propose a final dividend for the year ended 31 December 2019 at its upcoming annual general meeting on 7 May 2020. The group said it would be considering the “appropriateness, quantum and timing of an additional interim dividend payment” relating to fiscal 2019 after there is a “clearer view of the effects of Covid-19 on the business and outlook.”

According to unaudited results, Mondi, which has a new CEO since 1 April – see Plasteurope.com of 19.03.2020 – reported an EBITDA of EUR 385m in the first quarter of 2020, down 18% compared to same period in 2019. It said this was driven by lower pricing across its key paper grades due to lower input cost and Mondi’s ongoing cost reduction programmes. EBITDA in Q4 2019 was at EUR 381m.

In Q1, Mondi reported that order activity was good in consumer and e-commerce end-uses in its packaging and engineered materials businesses. With its flexible packaging unit, the group reported strength in food, beverage and home-care applications, while demand was weaker in the building and construction industries.

Amidst the coronavirus pandemic, the packaging producer has postponed non-essential capital expenditure and slowed down some of its projects. It is planning for capital expenditure of approximately EUR 600m in 2020, down from EUR 700-800m previously.

With the exception of the temporary closures of certain Mondi paper mill and paper bag converting facilities, such as Neusiedler / Austria and Merebank / South Africa, the company noted that all its other facilities have remained in operation. Up to 9 April, supply chain issues have been “manageable,” although delays and increased logistics costs are becoming apparent.

Mondi also has support measures to assist in providing supplies for the coronavirus pandemic. The group’s Personal Care Components team has adapted a line in Gronau / Germany to manufacture elastic, three-layer laminate straps (binding a stretchable, plastic film between layers of nonwoven material) used for medical masks. The plastic film is extruded in controlled, hygienic conditions at the Gronau plant, which is normally dedicated to producing hygiene products including diapers and feminine-care items.

At its plant in Taicang, Jiangsu / China, Mondi also laminates film to make nonwoven hygiene products. The company said it was able to supply mask straps to Chinese customers during the Covid-19 epidemic in China.