Paper and plastics packaging products company Mpact reported a 16% jump in group revenue to R4.8bn for the first five months to 31 May 2021 compared with the same period the year before.
The group said in a trade update that trading for the period under review has been strong, with underlying profit exceeding pre-pandemic comparatives in both the Plastics and Paper businesses. Investors reacted positively to the news, sending the share price up more than 13% in afternoon trade before bagging profits.
The group said underlying operating profit more than doubled to R240m as the Paper business benefited from improved global containerboard prices, increased local sales and higher average prices. However, the benefits of higher containerboard prices were partly offset by higher waste paper costs which have increased dramatically since the end of 2020, along with a general increase in demand and pricing for commodities, the group said.
Sales of plastic packaging products benefitted from increased demand in most sectors, but the benefit of increased sales was partially offset by significant increases in polymer prices.
By 2.56 pm the share was trading only 1.28% firmer at R23.75 as investors banked profits.