Mpact maintains interim dividend despite lower profits and challenging market conditions
Image: Supplied
South Africa's biggest paper and plastics packaging business and recycler Mpact maintained its interim dividend at 30 cents a share despite lower profit as it is confident of an improved performance in the second half.
This was according to financial director Hannes Snyman, who, along with CEO Bruce Strong, was interviewed at the release of the results for the six months to June 30. Underlying earnings before interest, depreciation and amortisation fell by 14.5% to R625 million and operating profit lower by 25.5% to R315m. Headline earnings per share decreased to 93 cents from 128.1 cents.
Strong said the lower earnings were primarily the result of persistent and lagging demand in South Africa due to the weak macroeconomic environment, traditionally lower sales in the first half in the plastics business, and product optimisation in the PET conversion and closure plant, which had led to additional costs.
He said they continued to face a persistently challenging trading environment. The general economy remained subdued, despite lower interest rates and inflation, while uncertainty across local and global markets negatively impacted business confidence.
And while they did not expect to be seriously impacted by higher US import tariffs, there might be secondary impacts further into the future, such as, for example, as it pertains to other South African manufactured exports, said Strong.
During the six-month period, good volume growth was realised in containerboard and fruit packaging - these were two sectors in particular, that the group had focused on in its strategy of growing and investing in innovative, higher-margin, and sustainable products.
Video Player is loading.
Play Video
Play
Unmute
Current Time
0:00
/
Duration
-:-
Loaded :
0%
Stream Type LIVE
Seek to live, currently behind live
LIVE
Remaining Time
-
0:00
This is a modal window.
Beginning of dialog window. Escape will cancel and close the window.
Text Color White Black Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Transparent Semi-Transparent Opaque
Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps
Reset
restore all settings to the default values Done
Close Modal Dialog
End of dialog window.
Advertisement
Video Player is loading.
Play Video
Play
Unmute
Current Time
0:00
/
Duration
-:-
Loaded :
0%
Stream Type LIVE
Seek to live, currently behind live
LIVE
Remaining Time
-
0:00
This is a modal window.
Beginning of dialog window. Escape will cancel and close the window.
Text Color White Black Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Transparent Semi-Transparent Opaque
Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps
Reset
restore all settings to the default values Done
Close Modal Dialog
End of dialog window.
Next
Stay
Close ✕
But these gains, however, were offset by declines in industrial sales volumes due to portfolio optimisation and depressed consumer demand.
Progress on capital projects continued. At the R1.3 billion upgrade at the Mkhondo mill, commissioning of the sodium lignosulphonate (SLS) plant was completed, and the pulp mill upgrade was in its final stage of construction.
The pulp mill would be commissioned in the third quarter of this year, said Strong. Thereafter, several months would be required to optimise both plants to reach design specifications and conduct SLS customer trials.
In the first half, the paper business was impacted by the global cyclical downturn in the paper industry, which led to lower margins, as selling prices decreased more than input costs, particularly due to higher local recovered paper prices.
Local and export containerboard volumes grew due to the competitive position of the Felixton paper mill. Fruit sector demand was up, with good growth in plastic crates and citrus cartons partially offset by lower sales volumes in banana and avocado cartons. 'We anticipate continued growth in the agricultural sector in the second half,' said Strong.
The industrial market remained weak, impacting the Springs mill, the Paper Converting business, and beverage crates. The FMCG Wadeville's volume fell significantly following expiry of two supply contracts with a major customer.
Paper business increased 6.9% to R5.4bn, due to a 5.9% increase in sales volumes and a 1% increase in average selling price. Gross profit was in line with the prior period.
The Recycling business increased collection volumes. Recovered paper prices were up significantly due to continued export demand, especially from India.
Paper Manufacturing increased containerboard sales volumes by 20.3% following interventions at the end of 2024 to increase exports and displace imports.
Cartonboard sales volumes from the Springs paper mill fell by 9.5% due to subdued local market conditions and import competition. The Springs mill took 15 days of commercial downtime in the current period to manage stock levels. In addition, the mill incurred 18 days of downtime due to external utility supply interruptions.
Revenue in the Plastics business decreased by 14.7% to R936m. The group expected an improved full-year result from the Plastics business compared to the prior year.
Visit:www.businessreport.co.za
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
IOL News
6 hours ago
- IOL News
Effective empowerment of women will boost the economy
Refilwe Lesufi Image: Supplied As Women's Month continues to be commemorated in South Africa with colourful banners and applause, it is worth noting that for many women and girls, the struggle for equal opportunity is a daily lived experience. Efforts to empower women and girls in South Africa have not resulted in an impactful shift in addressing historical disparities. The labour market continues to favour men and shows minimal signs of making real progress towards improving prospects for women. Stats SA's latest Quarterly Labour Force Survey for the second quarter of 2025 reveals ongoing disparities in the labour market. A media statement by Stats SA notes that the unemployment rate for women in this period was 35,9% compared with 31,0% for men, a gap of 4,9 percentage points. 'These differences reflect persistent gender imbalances in unemployment, labour force participation and the sectors in which men and women are employed.' Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad loading Education is also not closing the gap in unemployment for South African women, according to the Stats SA statement, and gender disparities in the labour market remain entrenched across all levels of educational attainment. 'In the second quarter of 2025, the official unemployment rate for graduates stood at 12,2%, marking a 0,5 percentage point increase from the previous quarter. … a closer look reveals a persistent gender gap among the most educated. Female graduates faced an unemployment rate of 15%, compared to 8,9% for their male counterparts, a difference of 6,1 percentage points.' A gender-focused approach is needed to deliver employment opportunities that are inclusive and responsive to challenges faced by women. In South Africa, a large share of the country's scarce skills lies within Science, Technology, Engineering, and Mathematics (STEM ) fields. According to the Reginsights article, ''The Most In-Demand Skills in South Africa 2025,' skills such as ICT specialists, engineering professionals, healthcare workers, renewable energy experts, technicians, education specialists, agricultural scientists, finance specialists, and logistics professionals are all in short supply. As we celebrate National Science Week, let us remember that the future of STEM in South Africa lies in the hands of our youth. Image: Supplied STEM as a strategic driver offers a powerful, gender-focused pathway to creating inclusive employment opportunities, especially for women in rural areas, informal settlements and townships, while directly addressing the unique barriers they face. PROTEC is an independent NPO that provides education support in STEM gateway subjects – Mathematics, Technology and Science – as well as English and World of Work life skills training. In partnership with our funders, we have consistently committed to advancing the gender equality and redress agenda. More than 63% of our total beneficiaries are female, and we are seeing a growing number of young women pursuing careers in engineering, science, and other STEM fields that were once male-dominated. In 2024, ten of PROTEC's top twelve matric beneficiaries were female. Why is a focus on women so important? An article by the Stellenbosch University Business School in December 2024, titled 'Equal pay for equal work: How does South Africa measure up?' reveals that, 'In South Africa, around 38% of households are headed by women. Female-headed households are approximately 40% poorer than those headed by men. Also, 48% of female-headed households support extended family members compared to only 23% of male-headed households.' Women bear a disproportionate burden in caring for children, earn less than men, are more vulnerable to domestic violence, and face greater challenges in accessing resources to improve their lives — illustrating how power dynamics continue to favour men.
The Star
6 hours ago
- The Star
Effective empowerment of women will boost the economy
Refilwe Lesufi | Published 14 minutes ago As Women's Month continues to be commemorated in South Africa with colourful banners and applause, it is worth noting that for many women and girls, the struggle for equal opportunity is a daily lived experience. Efforts to empower women and girls in South Africa have not resulted in an impactful shift in addressing historical disparities. The labour market continues to favour men and shows minimal signs of making real progress towards improving prospects for women. Stats SA's latest Quarterly Labour Force Survey for the second quarter of 2025 reveals ongoing disparities in the labour market. A media statement by Stats SA notes that the unemployment rate for women in this period was 35,9% compared with 31,0% for men, a gap of 4,9 percentage points. 'These differences reflect persistent gender imbalances in unemployment, labour force participation and the sectors in which men and women are employed.' Education is also not closing the gap in unemployment for South African women, according to the Stats SA statement, and gender disparities in the labour market remain entrenched across all levels of educational attainment. 'In the second quarter of 2025, the official unemployment rate for graduates stood at 12,2%, marking a 0,5 percentage point increase from the previous quarter. … a closer look reveals a persistent gender gap among the most educated. Female graduates faced an unemployment rate of 15%, compared to 8,9% for their male counterparts, a difference of 6,1 percentage points.' A gender-focused approach is needed to deliver employment opportunities that are inclusive and responsive to challenges faced by women. In South Africa, a large share of the country's scarce skills lies within Science, Technology, Engineering, and Mathematics (STEM ) fields. According to the Reginsights article, ''The Most In-Demand Skills in South Africa 2025,' skills such as ICT specialists, engineering professionals, healthcare workers, renewable energy experts, technicians, education specialists, agricultural scientists, finance specialists, and logistics professionals are all in short supply. STEM as a strategic driver offers a powerful, gender-focused pathway to creating inclusive employment opportunities, especially for women in rural areas, informal settlements and townships, while directly addressing the unique barriers they face. PROTEC is an independent NPO that provides education support in STEM gateway subjects – Mathematics, Technology and Science – as well as English and World of Work life skills training. In partnership with our funders, we have consistently committed to advancing the gender equality and redress agenda. More than 63% of our total beneficiaries are female, and we are seeing a growing number of young women pursuing careers in engineering, science, and other STEM fields that were once male-dominated. In 2024, ten of PROTEC's top twelve matric beneficiaries were female. Why is a focus on women so important? An article by the Stellenbosch University Business School in December 2024, titled ' Equal pay for equal work: How does South Africa measure up? ' reveals that, 'In South Africa, around 38% of households are headed by women. Female-headed households are approximately 40% poorer than those headed by men. Also, 48% of female-headed households support extended family members compared to only 23% of male-headed households.' Women bear a disproportionate burden in caring for children, earn less than men, are more vulnerable to domestic violence, and face greater challenges in accessing resources to improve their lives — illustrating how power dynamics continue to favour men. With concerted effort by South African organisations across the board, we can break barriers, redress imbalances, and ensure that South Africa's future workforce is inclusive and ready for the challenges of tomorrow. Industry leaders can actively invest in: Exposure – by introducing girls to STEM career paths from an early age. Support – by funding education, training, and resources. Mentorship – by connecting learners with role models. Employment pathways – through internships, bursaries and jobs. As UN Women reminds us: 'Ensuring women's and girls' rights in all areas of their lives is the only way to secure prosperous and just economies and build a healthy planet for future generations.' By deliberately empowering girls and women, we have the power to reshape history, drive economic growth, reduce poverty and improve health and livelihoods.
IOL News
11 hours ago
- IOL News
The Le Roux Question: Millions shape media, courts, democracy?
The Millennium Trust funds initiatives in media, law, civil society, and politics across South Africa, supporting organisations such as Daily Maverick, amaBhungane, CASAC, Freedom Under Law, and Judges Matter. | These grantees are said to operate with full editorial and organisational independence, but the Trust's influence is said to be exercised indirectly through advocacy, investigative work, and legal reform efforts, rather than through direct control. | The Trust provides financial support to the Democratic Alliance Image: Sizwe Dlamini ECONOMIST Dr Séan Mfundza Muller has issued a stark warning about the growing power of South Africa's ultra-wealthy, spotlighting Michiel le Roux, co-founder of Capitec Bank, and his alleged behind-the-scenes influence on media, politics, and civil society through strategic funding, raising questions about accountability, transparency, and the integrity of democratic institutions. Speaking on Ntsiki Mazwai's Moya podcast, Muller said: 'Another South African billionaire, who I think is very interesting, is Michiel le Roux, who is one of the people behind Capitec. Now, as far as I know — and I heard this both from a private source and then I also came across a public source of this information — Le Roux is behind a trust called the Millennium Trust.' Muller explained that, according to his research and private discussions, the Millennium Trust, which was founded around 2010, supports a 'constellation of powerful voices in civil society', noting: 'The Millennium Trust funds the Daily Maverick, amaBungane, the Council for the Advancement of the South African Constitution (Casac), Freedom Under Law, as far as I know … and I'm going from memory here.' He further said that the trust operated with a certain degree of opacity: 'But so you've got all these civil society organisations, all these media outlets being funded by this … trust. I mean, I've gone to look at the directors. You would never guess from the directors of this trust. You would not be able to find out who's behind it.' Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Muller described how he discovered the connection: 'I only found out because I stumbled across something online and because somebody who had direct knowledge … told me privately that Le Roux is behind this.' When reached for comments, the Millennium Trust said they would get the appropriate person to respond to questions from the Sunday Independent, but had not got back to us by the time of compiling this report. Attempts to get comments from Le Roux drew a blank. Regarding potential implications, Muller raised concerns about editorial independence and transparency, saying: 'While these funds support critical journalistic and civic activities, concerns persist about their impact on editorial independence. Newsrooms such as the Daily Maverick and amaBhungane maintain that funding does not dictate editorial control, yet the exact terms and amounts often lack full public disclosure, raising questions about transparency in media financing.' He also spoke about Le Roux's financial support to South Africa's main opposition party, the DA: 'Michiel le Roux funds the DA … so he also funds their court cases. He funds the civil society organisations that apply to the court to be friends of the court in court cases. And he funds the media houses that report on all of that.' Muller posed a rhetorical question on the ramifications for public understanding: 'Okay, now, how do you think as an ordinary person, you're going to be able to get accurate information on, for example, who's corrupt and who's not, who's good and who's bad?' He noted that Le Roux's donations reportedly exceeded R50 million between 2021 and 2023 through private companies such as Fynbos Ekwiteit and Fynbos Kapitaal, making him among the largest disclosed donors to the DA within that timeframe. Muller also commented on broader patterns of philanthropic influence: 'This is just one billionaire. When they control three, right, and those are just the ones we know about, right, that's not even like particularly covert. As soon as you know who's funding the trust, you can figure that out loud, right? There's a whole lot of other stuff that we know less about, what we have to find out about through private sources … like who's funding Rivonia Circle … which is another thing which I've raised over the last couple of years.' Reflecting on new civic movements and political projects, Muller observed: 'Rivonia Circle was really the platform that Songezo Zibi used to start Rise Mzansi, which eventually we discovered was funded by the Oppenheimers.'
