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Africa's largest paper and packaging business and recycler Mpact said it generated a record R2 billion in cash in its 2023 year even as it grappled with volume pressure in a tough consumer economy. Despite a double-digit fall in volumes, it still sees bright spots that include SA's fruit exports, while it is also busy repositioning its portfolio to focus on higher-demand products.
The company, valued at about R4.2 billion on the JSE, reported on Friday that group revenue from continuing operations in its year to end-December increased by 3.6% to R12.8 billion, despite a 10.7% fall in sales volumes. Operating profit picked up as a result of a recovery in margins and some recently completed projects, while headline earnings per share lifted 8%.
Cash generation almost doubled to about R2 billion, helped mostly by positive working capital effects amid downtime at its mills as it looked to preserve cash, but also the improved operating profit. The company's profit still fell about 2.5% to R777.5 million, however, mostly due to about R92 million non-cash writedown to its plastic preforms and closures business.
