Mondi Group: Strong Q1, Yet MNP Share Price JSE Stalls – Will the Break Come?

Quick overview

Mondi Group remains a heavyweight in global packaging and paper, delivering solid earnings and strategic progress even as its South African share price remains in a range.

Mondi Group: Profile and Market Value

Mondi Group, with major operations in South Africa, is a leading multinational producer of sustainable packaging and paper with a market capitalization of approximately R126.32 billion, or about $7.38 billion in US dollars. This valuation underscores the company’s significance in the sector and reflects investor confidence in its diversified business model and global footprint, however the share price has been trading in a range since 2018.

Share Price Performance in South Africa

While Mondi’s global operations remain robust, its local share price, trading under the ticker MNPJ on the Johannesburg Stock Exchange, has struggled on shorter timeframes.

MNPJ Chart Daily – The R300 Level Has Turned Into Resistance

The daily chart reveals that Mondi South Africa shares turned clearly bearish by mid-2024, falling sharply from around 37,000 ZAC to approximately 26,000 ZAC—a decline of roughly 30%. In the first quarter of 2025, the share price fell further to 24,300 ZAC before rebounding as global risk sentiment improved, reaching about 30,000 ZAC. However, that level has since formed a solid resistance line that has repeatedly repelled buyer attempts to push the price higher.

MNPJ Chart Monthly – The R300 Level Has Turned Into Resistance

On the monthly chart, MNPJ shares appear to have been consolidating since 2018. The price has not managed to break out above 43,000 ZAC, but strong buying interest has consistently emerged around the 25,000 ZAC support zone—a level that has held firm since 2016.

Investors often see this support as an attractive long-term accumulation area. Yet buyers are still facing significant resistance from key moving averages that previously offered support. For the share price to establish sustainable upward momentum, investors will need to decisively clear these averages.

Operational Highlights and Earnings Performance

Despite these local share price challenges, Mondi’s underlying business performance has shown resilience and strategic discipline.

In the first quarter of 2025, Mondi reported an underlying EBITDA of €290 million, marking a strong year-over-year improvement from €214 million in Q1 2024. This growth was primarily driven by increased sales volumes, even though average selling prices declined compared to the final quarter of 2024.

Mondi has reaffirmed its full-year guidance for project contributions, projecting between €50 and €100 million in EBITDA, signaling its confidence in ongoing capacity expansions and strategic investments.

The company’s 2024 interim results also demonstrated strong execution. Despite a challenging pricing environment and reduced demand, Mondi delivered solid EBITDA generation and increased its interim dividend. This performance reflects effective cost management, a diversified operational base spanning Europe, North America, and Africa, and ongoing leadership in sustainable packaging solutions.

Mondi Q1 2025 Earnings Report Highlights

Strong Underlying EBITDA Growth:

• Mondi reported €290 million in underlying EBITDA for Q1 2025.
• This marks a significant rise from €214 million in Q1 2024, reflecting operational improvements and higher sales volumes.

Sales Volumes and Pricing Trends:

• The EBITDA increase was primarily driven by higher sales volumes.
• However, average selling prices in Q1 2025 were lower than those in Q4 2024, signaling ongoing pricing pressure in some markets.

Full-Year Guidance Maintained:

• The company reiterated its full-year guidance for project contributions.
• Expects €50–100 million EBITDA from strategic projects, underscoring confidence in planned expansions and upgrades.

Market Conditions in Uncoated Fine Paper:

• The Uncoated Fine Paper segment faced muted demand and lower average selling prices compared to the prior quarter.
• Profitability was supported by robust cost control measures despite these headwinds.

Capacity Expansion Progress:

• Significant advancements made on major projects:
• New kraft paper machine in Steti, Czech Republic.
• Conversion of a paper machine in Duino, Italy.
• These projects are designed to enhance production capacity and meet future demand for sustainable packaging solutions.

Strategic Acquisition Completed:

• Mondi finalized the acquisition of Schumacher Packaging’s Western Europe assets on March 31, 2025.
• This deal adds approximately 2,200 new employees and provides a broader platform for integration and synergy creation in the packaging segment.

Monitoring Global Trade Tensions:

• Although direct impacts of recently announced tariffs on Mondi’s operations are limited, the company remains cautious.
• Management is mindful of second-order risks to trade flows, consumer confidence, and broader supply chains.

Dividend Expectations:

• Mondi is expected to announce its final dividend for 2024 shortly.
• For South African branch register shareholders, dividend tax calculations will be based on the ZAR/euro exchange rate published on February 20, 2025.

Analyst Upgrade Boosts Sentiment for Mondi

After JPMorgan upgraded Mondi UK and South Africa shares from Neutral to Overweight in May, investor interest in the packaging and paper giant intensified. Analyst Detlef Winckelmann cited multiple factors behind the bank’s more bullish stance. Among the key reasons were limited downside risks in containerboard markets and meaningful upside potential in the kraft paper segment, both of which support a stronger outlook.

Following Mondi’s solid Q1 earnings report, JPMorgan also highlighted an improved mood among investors, reinforcing confidence in the company’s ability to navigate market challenges and capitalize on growth opportunities.

Strategy and Long-Term Positioning

Mondi continues to pursue a long-term growth strategy centered on sustainability and operational scale. Capacity expansion projects include the new kraft paper machine at Steti in the Czech Republic and the converted paper machine in Duino, Italy, both supporting increased production and new market opportunities.

Strategic acquisitions have also bolstered Mondi’s capabilities, such as the purchase of Schumacher Packaging’s Western European assets, which closed at the end of March 2025. This deal added 2,200 new employees to Mondi’s workforce and expanded its footprint in a critical market, with management focused on integration and unlocking synergy benefits.

The company remains committed to its leadership position in sustainable packaging, providing innovative, environmentally friendly solutions that align with shifting consumer expectations and evolving regulatory demands.

Significant Ownership Update

A notable development in Mondi’s ownership structure occurred in 2024. On September 10, 2024, the Johannesburg Stock Exchange recorded that Allan Gray Proprietary Limited, an investment firm based in Cape Town, South Africa, had acquired significant voting rights in Mondi plc. The change was formally documented on September 5, 2024. This move signals continued institutional interest and confidence in Mondi’s long-term growth prospects, further underscoring its position as a core player in the packaging sector.

Conclusion: Despite share price volatility in South Africa, Mondi’s strong underlying EBITDA growth, disciplined cost management, and strategic investments demonstrate a company well-positioned for the future. As it navigates pricing challenges and competitive pressures, Mondi continues to lay the groundwork for sustainable long-term growth, cementing its role as a global leader in environmentally friendly packaging solutions. Investors will be watching key technical levels closely for signs of a breakout that would reflect this operational strength in its share price.

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Skerdian Meta

Lead Analyst

Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.

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