MM reports on H1 22

MM has reported on its performance for H1 2022. Sales were €2,218.5m, up 72% on the same period last year. Profit before tax was €270.2m, up 225.7% on the same period in 2021.

Peter Oswald, MM CEO, comments, “Demand for our products is strong. Our strategy of focused organic growth and value enhancing acquisitions combined with a strong grip on improvement of productivity is starting to pay off. In the 1st half-year organic growth of Packaging was close to 5 %, just limited by capacity restrictions, as our customers value our increased focus on innovation and sustainability as well as supply security due to our backward integration with cartonboard. The acquisition of Essentra Packaging, expected to be closed in the 4th quarter, will take MM to a global leadership position in secondary pharmaceutical packaging and position us for more organic growth and resilience throughout the business.

“The enormous cost inflation was mitigated by price adjustments, cost control and a step-up in operational efficiencies. On top, our half-year income statement has been particularly influenced by the inclusion of the cartonboard and paper mills MM Kwidzyn and MM Kotkamills, which were acquired a year ago. At the same time, we significantly increased capex in order to reduce energy consumption, raise quality and increase output. We are convinced there is much we can improve through the enhanced focus on digitalization, sustainability and innovation. As the continuous supply of our customers has top priority, we have undertaken several measures to mitigate a possible gas rationing, which would affect all cartonboard and paper mills except MM Kwidzyn; we have started to build up safety stocks for recycled fibre-based cartonboard, rented gas storage facilities in Austria, and are investing in alternative oil firing in Finland. The second half-year will be impacted by planned capex-related downtime, necessary adjustment measures and supply chain disruptions, at an extent which seems quite unpredictable at this point in time.”

In its statement, the company said the second half-year will be particularly impacted by planned capex-related downtime (rebuild at Neuss board mill in Germany, and at Kotkamills in Finland), necessary adjustment measures and supply chain disruptions, at an extent which seems currently quite unpredictable. Ensuring business continuity and sustainable supply of customers will stay MM’s top priority. They said they will follow up on this through flexible procurement and logistics management, continuous investment activity (€250-300m each in 2022 and 2023), and the safeguarding of profitability. Finally, they said that regarding exposure in Russia for the packaging division, the company continue to review all options.

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