MONDI GROUP RESULTS FOR THE YEAR ENDED 31 ......Group ROCE 3 up by 31% to 10.6% Final dividend of...

MONDI GROUP RESULTS FOR THE YEAR ENDED 31 DECEMBER 2007

28 February 2008

Year end results 2007

AGENDA

1. Highlights

2. Financial overview

3. Operational review

4. Strategy update

5. Outlook

6. Appendices

Steti, Czech Republic


HIGHLIGHTS

Mondi demerged from Anglo American plc and separately listed on 3 July on both the JSE and LSE

Experienced significant improvement in earnings versus 2006EBITDA1 up 20% at €870 millionUnderlying operating profit 2 up 33% at €502 millionUnderlying EPS up 74% at 46.9 euro centsCash inflow from operations up 46% at €957 millionGroup ROCE 3 up by 31% to 10.6%

Final dividend of 15.7 euro cents per ordinary share (full year 23.0 euro cents per share)

1 EBITDA is operating profit of subsidiaries and joint ventures before special items, depreciation and amortisation. 2 Underlying operating profit is operating profit of subsidiaries and joint ventures before special items. 3 Group ROCE is underlying operating profit including share of associates' net earnings divided by average trading capital employed.


HIGHLIGHTS (continued)

Good performance due to:Low cost asset baseExposure to emerging marketsFlexibility and responsiveness

Responsiveness demonstrated by Hungarian closure, UFP restructuring and organisational streamlining

Delivered a further €167 million in cost savings

Major growth projects in emerging markets commenced and on track

Completed a number of acquisitions and disposals


AGENDA

1. Highlights



4. Strategy update

5. Outlook

6. AppendicesMerebank, South Africa


FINANCIAL HIGHLIGHTS

ALL KEY INDICATORS SIGNIFICANTLY UP

€ millions, except for per share measures and ROCE 2007 2006 %Change

Group revenue 6,269 5,751 + 9EBITDA 1 870 726 + 20Underlying operating profit 2 502 377 + 33Underlying profit before tax 3 405 305 + 33Reported profit before tax 382 223 + 71Underlying earnings per share (€ cents per share, 2006 pro forma) 4 46.9 27.0 + 74Final dividend per share (€ cents per share) 15.7 n/a n/aTotal dividend per share (€ cents per share) 23.0 n/a n/aCash inflow from operations 957 657 + 46Group ROCE 5 10.6% 8.1% + 31

1 EBITDA is operating profit of subsidiaries and joint ventures before special items, depreciation and amortisation. 2 Underlying operating profit is operating profit of subsidiaries and joint ventures before special items. 3 Underlying profit before tax is reported profit before tax before special items. 4 Underlying earnings per share is before special items and based on shares issued on admission. 5 Group ROCE is underlying operating profit including share of associates' net earnings divided by average trading capital employed.


DIVISIONAL RESULTS

SUBSTANTIAL IMPROVEMENT IN PROFITABILITY

Group revenue EBITDA 1 Underlying operating profit 2

€ millions 2007 2006 Change 2007 2006 Change 2007 2006 Change

PACKAGINGCorrugated Business 1,644 1,497 147 242 206 36 158 120 38 Bag Business 1,265 1,162 103 207 174 33 127 97 30 Flexibles Business 786 607 179 54 32 22 27 9 18 Inter-segment eliminations (105) (99) (6)

3,590 3,167 423 503 412 91 312 226 86

BUSINESS PAPER 1,898 1,889 9 289 237 52 152 104 48

MPSA 419 360 59 53 46 7 35 35 -

MERCHANT & NEWSPRINT 591 539 52 60 48 12 40 29 11

CORPORATE & OTHER 28 31 (3) (35) (17) (18) (37) (17) (20)

Inter-segment eliminations (257) (235) (22)

MONDI GROUP 6,269 5,751 518 870 726 144 502 377 125

1 EBITDA is operating profit of subsidiaries and joint ventures before special items, depreciation and amortisation. 2 Underlying operating profit is operating profit of subsidiaries and joint ventures before special items.


DIVISIONAL RETURNS

SIGNIFICANT IMPROVEMENT IN ROCE TO 10.6%

ROCE (%) 1 EBITDA return(%) 2 Return on Sales (%) 3

2007 2006 2007 2006 2007 2006

PACKAGING 13.2 10.2 14.0 13.0 8.7 7.1

BUSINESS PAPER 8.0 5.3 15.2 12.5 8.0 5.5

MPSA 13.8 17.4 12.6 12.8 8.4 9.7

MERCHANT & NEWSPRINT 17.3 12.5 10.2 8.9 6.8 5.4

MONDI GROUP (ROCE) 10.6 8.1 13.9 12.6 8.0 6.6

1 ROCE is underlying operating profit including share of associates' net earnings divided by average trading capital employed, and for the divisions extracted from management accounts. 2 EBITDA return is EBITDA divided by Group revenue. 3 Return on sales is underlying operating profit divided by Group revenue.


COST STRUCTURE 2007

Wood, pulp and fibre

34.1%

Personnel15.7%Variable selling

expenses9.7%

Energy6.6%

Maintenance5.0%

Other variable costs15.9%

Other net operating expenses

6.6%

Depreciation and amortisation

6.4%

COST SAVINGS - €167 MILLION

179 180

167

100

110

120

130

140

150

160

170

180

190

2005 2006 2007

€ m

illio

n

COSTS AND COST SAVING INITIATIVES

COST SAVINGS OF €167 MILLION HELPED TO OFFSET COST INFLATION

3.9% 3.6% 3.1%

• €96 million material input cost savings • €41 million saving in energy costs• €15 million personnel cost savings • Costs savings 3.1% of prior

year cash cost base

• Fibre costs increasing (34.1% vs 31.4% sales)External wood costs up 20-25% and recycled fibre up 45%Benefit from own low cost wood resource in Russia and South Africa which accounts for 50% of wood requirements

• Fixed costs, ex acquisition, flat year on year


FINANCE CHARGES AND NET DEBT

Total committed facilities of €2.7 billion, of which €1.2 billion undrawnAverage term remaining on the committed facilities is 3.5 yearsFinance charges up mainly as a result of higher average debt levels, higher interest rates and movement in exchange gains

(1) Net debt and finance charges under old capital structure for 2006 and before special item 2007

€ millions 2007 2006 (1) Change

Net debt 1,507 1,479 28

Net debt finance charges and other financial income 93 65 28 Net post retirement finance costs 6 12 (6)Net finance costs (1) 99 77 22

SUBSTANTIAL DEBT FACILITIES IN PLACE


SPECIAL ITEMS

Operating

Impairments €61mEuropean UFP closures (Hungary) Carbonless plant

Retention arrangements €9m Accelerated AA plc share scheme demerger cost €8mNegative goodwill (€1m)

Net profit on disposals

Disposals:5.34% in Swiecie €57m B + K (associate) €19m Corrugated (UK & Ireland) €8mOther (€1m)

Finance charges:Closing out of debt instruments in SA €29m (2006 € nil)

NET RESULT OF SPECIAL ITEMS FOR THE YEAR IS €8M LOSS AFTER TAX

€ millions 2007 2006

Total cost 77 78


Profit/(loss) 83 (4)


TAXATION AND DIVIDENDS

Taxation

Effective tax rate before special items of 29%9 percentage points lower than 2006 due to fewer adjustments

DividendsFinal proposed dividend of 15.7 euro cents per shareRecord date 25 April 2008Payment date 21 May 2008Total dividend for 2007 of 23.0 euro cents per shareDividend cover of 2.0 times based on 2007 earnings

€ millions 2007 2006 Change

Underlying tax charge (117) (115) (2)Tax on special items 15 21 (6)Total tax charge (102) (94) (8)


CASH FLOW

€300 MILLION MORE IN CASH INFLOWS FROM OPERATIONS


EBITDA 870 726 144 Working capital movements 97 (82) 179 Other operating cash flow adjustments (10) 13 (23)Cash inflows from operations 957 657 300 Dividends from associates and financial investments 1 2 (1)Tax paid (93) (71) (22)Net cash inflow from operating activities 865 588 277 Capital expenditure (406) (460) 54 Investment in forestry assets (41) (50) 9 Acquisitions (193) (116) (77)Disposals 166 37 129 Proceeds on sale of fixed assets and other 22 14 8

413 13 400


CAPITAL INVESTED AND FINANCING

STRONG AND ROBUST FINANCIAL POSITION


Trading capital employed 4,818 4,737

Group ROCE (1) 10.6% 8.1%

Shareholders funds 2,963 2,966

Return on shareholders funds (post tax) (2) 8.1% 4.8%

Net debt 1,507 1,479

Gearing (Net debt/Equity) 45.2% 44.9%

EBITDA interest cover (times) 9.6 9.3

(1) Group ROCE is underlying operating profit including share of associates' net earnings divided by average trading capital employed.(2) Return on shareholders funds is underlying earnings divided by average shareholders funds.


GROUP REPORTING

Following Group wide organisation review announced 18 October 2007 we will be revising our segmental reporting with effect from 1 January 20082007 REPORTING FUTURE REPORTING

MONDI PACKAGING EUROPE & INTERNATIONAL DIVISION

Corrugated Business Corrugated Business

Bag Business Bags and Specialities 1

Flexibles Business Uncoated Fine Paper

MONDI BUSINESS PAPER SOUTH AFRICA DIVISION

Uncoated Fine Paper (including forestry assets)

Corrugated

MONDI PACKAGING SOUTH AFRICA MONDI PACKAGING SOUTH AFRICA

MERCHANT & NEWSPRINT MERCHANT & NEWSPRINT

CORPORATE & OTHER CORPORATE & OTHER

1 Flexibles Business has been renamed "Specialities".


FINANCIAL SUMMARY

Results show we are delivering improvements in:

ProfitsCash flowsReturns on capital employed

Obsession with cost savings

Strong financial position


AGENDA

1. Highlights



4. Strategy update

5. Outlook

6. AppendicesRuzomberok, Slovakia


PACKAGING

Average pricingKraftliner prices up 10%Kraft paper prices up 12%Box prices up 10%

Production and volumesProductivity records at 10 out of 14 paper millsContainerboard volumes up 3% Kraft paper volumes up 5%

Cost savings of €81 million


Segment revenue 3,590 3,167 423 Underlying operating profit 312 226 86


Corrugated packaging fundamentals

Q1 2001 – Q4 2007. Source: PIX (FOEX Indexes Oy Ltd)

Mondi is +/-1.0 million tonnes long in kraftliner and are balanced in test linerCirca 26 million tonne market growing at:

Western Europe 1.8% 1Eastern Europe 8.2% 1

Good demand growth, particularly in Germany and Emerging EuropeKraftliner stable, testliner softeningCapacity closures in recycled grades of 2.5 mtpa since 2005Now operating at attractive capacity utilisation levelsNeed for improvement in downstream converting operations – mainly in western Europe

1 Source: ICCA

250

350

450

550

650

750

850

2001 2002 2003 2004 2005 2006 2007

€/to

nne

Kraftliner 175 gTestliner 2White top Kraftliner


Kraft paper fundamentals

Total European market size 3.1 mtpa

Mondi produce 900 ktpa, - are 400 ktpa long

Export sales redenominated in euros

No major new capacity announcements

UPM closure announced in 2007 of 115 ktpa

2001 2002 2003 2004 2005 2006 2007

Unbleached sack kraft


BUSINESS PAPER

PricingPrices up 7% on average year on year

VolumesUCWF volumes up 2.1%1

Total pulp production up 4%, record production in 4th quarter at Richards Bay 4% improvement in productivity

Good operational performance in Slovakia and RussiaSouth African restructuring completed as well as divisional organisation reviewPM31 much improved operating rates following headbox modificationHigh pulp costs impacting non-integrated mills, closure of Szolnok in HungaryCost savings of €82 million

1 Excluding PM9 in Hungary closed in 2006


Segment revenue 1,898 1,889 9 Underlying operating profit 152 104 48


Uncoated fine paper fundamentals

Q1 2001 – Q4 2007. Source: PIX (FOEX Indexes Oy Ltd)

Circa 12 million tonne market, growing at:Western Europe 1.3% 1Eastern Europe 6.6% 1

European capacity closures in 2006/2007 of 720 ktpa and 410 ktpa announced in 2008Following these closures, capacity utilisation should improveGlobal capacity expected to grow with demand – favourable demand supply balance forecast for foreseeable futureOnly confirmed major expansion in Europe is a new 500 ktpa machine at Portucel’s Setubal mill, planned for commissioning in 2009

1 Source: EMGE Woodfree Forecast Report October 2007 for Eastern and Western Europe

750

800

850

900

950

1,000

1,050

1,100

2001 2002 2003 2004 2005 2006 2007

€/to

nne

UFP


DIVISIONAL PERFORMANCE (Cont)

Mondi Packaging South Africa

Result up 8% in local currency, flat on translation into eurosPositive price developmentsTrading environment benefited from good demand, particularly from export focused customersLenco acquired on 4 July 2007

Merchant and Newsprint

Better trading environment at EuropapierAylesford benefitted from improved pricing, lower gas costs and once off benefit of a pension change (€4m)Mondi Shanduka Newsprint solid performance in local currency

Corporate and other All key functions as independent Group now in place


Segment revenue 419 360 59 Underlying operating profit 35 35 -


Segment revenue 591 539 52 Underlying operating profit 40 29 11


SOUTH AFRICAN POWER ISSUES

Working constructively with Eskom and local authorities to mitigate impact of load sheddingTo date no significant impact to our businessesMondi is relatively self sufficient

Richards Bay fully self sufficient following installation of 27MW gas turbine in 2006PM31 more energy efficient (saving 10MW)New multi fuel boiler and steam turbine additional 16MW

Downstream converting operations mostly affected through customer led demand impactsMajority of Richards Bay and Merebank production exportedSouth African domestic revenues are less than 10% of Group revenue

POWER ISSUE IS CRITICAL FOR SA ECONOMY BUT NOT FOR MONDI’S GLOBAL PERFORMANCE


AGENDA

1. Highlights



4. Strategy update

5. Outlook

6. AppendicesSyktyvkar, Russia


82%

18%

MONDI STRATEGIC DRIVERS

Leading market positionsParticularly in emerging markets

High quality low cost asset base

Focus on performance

Growth

EMERGING MARKETS BENEFIT FROM BOTH GROWTH AND

LOW COST Emerging markets Mature markets

Net operating assets 2007

65%

35%

Virgin based production


High quality low cost asset base

PRODUCTION IN LOWEST QUARTILE AND IN EMERGING MARKETS

Universal Office Paper

Mondi Paper Machines

Unbleached KraftlinerWhite-top Kraftliner

Cumulative capacity (Kt/a)

00 3,000

100% of Mondi Unbleached

Kraftliner capacity

€/t

100% of Mondi Universal Office Paper Capacity0

0 3,500Cumulative capacity (Kt/a)


€/t

1,400

100% of Mondi White-top Kraftliner

capacity0

0 Cumulative capacity (Kt/a)

€/t

1,400


capacity0

0

€/t

Universal Office Paper

Mondi Paper Machines

Unbleached KraftlinerWhite-top Kraftliner


00 3,000

100% of Mondi Unbleached

Kraftliner capacity

€/t

100% of Mondi Universal Office Paper Capacity0

0 3,500Cumulative capacity (Kt/a)


€/t

1,400


capacity0

0 Cumulative capacity (Kt/a)

€/t

1,400


capacity0

0

€/t


Wood costs

Mondi is circa 50% self sufficient in wood supply

100% self sufficient in Russia and South Africa

Polish and Slovakian market prices for timber remain around €10- €15/m3 lower than Scandinavia

Average hardwood and soft wood costs (€/m3, Q2 2007)

Source: Pöyry Forest Industry Consulting* Restated for Q1 2008 exchange rates

2225 25 26

30 3033

3739

42

47

SA (res

tated

)*Sou

th Afric

a

Brazil

Russia

ChileAus

tralia

Poland

Portug

alSwed

en

Finlan

d

France

100

110

120

130

140

Q4 2005 Q4 2006 Q4 2007

Sweden (birch) Finland (birch) Western Russia (birch for Finland) Brazil (euca)

Index (Q4 2005=100 for each country)


Focus on performance

EUROPEAN UFP CLOSURE + RESTRUCTURING

Approximately 75,000 tonnes production downtime taken in 2007 to manage inventory levels

Planning to reduce operating capacity by 6% through the planned closure of Szolnok mill in Hungary (140,000 tonnes) in Q2 2008

Reduction in divisional overhead and mill headcount

Closure cost and related actions circa €88m€57m impairment cost in 2007€31m cash cost in 2008

SUPPLY SIDE DISCIPLINEPROACTIVE AND RESPONSIVE TO MARKET CONDITIONS


Rigorous asset management

Reduced testliner capacity by 11% in 2004 (~ 110Kt)Closed 11% of corrugated packaging capacity (~280M m2) since 2004Closed paper machine South Africa (~110Kt)Closed 35 converting plants and two testliner mills, divested 30 converting plantsClosed UFP machine in Hungary in 2006 (~110Kt)Planned closure of UFP mill in Hungary in 2008 (~140Kt)

1 Includes three closures announced in 2007, but completed in 2008

57

10 11

24

5

10

10 5

2002 2003 2004 2005 2006 2007

Closure Divestiture

No. closures/divestitures

1


Productivity - Bag Converting

450

778

1,0401,097

1995 2000 2006 2007

1,00

0 un

its p

er c

apita

Ongoing operational excellence and efficiency gains in 2007

Operational performance

+8% CAGR

4%

9%

3%

6%

UFP Containerboard CorrugatedPackaging

Bag Converting


Major growth projects in emerging marketsSyktyvkar mill expansion - €525m

Modernisation and expansionCompletion expected mid 2010Exposed to strong demand growth for UFP and containerboard in the Russian marketAll existing forestry leases converted to new codeFurther 1.9m m3 of forestry lease approvals received from Russian authoritiesKey equipment orders have been placed, first equipment on site

Containerboard & box plant - €350mLocated at Swiecie mill in Poland470,000t lightweight recycled containerboard machine and corrugated box plantCapacity of circa 250m m2/year Start up mid to late 2009Additional volume is required to supply the high growth emerging European marketsTargeted to be clear cost leader in Europe

BOTH PROJECTS HAVE COMMENCED AND ARE ON TRACK

Universal Business Paper Cost Curve

200

400

600

800

1,000

1,200

0 1,000 2,000 3,000 4,000Cumulative capacity (1 000 t/a)

Syktyvkar PM14

€/t

100150200250300350

0 5,000 10,000Cumulative capacity (1 000 t/a)

€/t

Recycled Fluting Cost Curve

PM CEE Light


AGENDA

1. Highlights



4. Strategy update

5. Outlook

6. AppendicesPlantation, South Africa


OUTLOOK TRADING

“We believe that Mondi’s leading positions in the emerging markets provide both cost and growth advantages. Furthermore our focused strategy, obsession with driving down costs and willingness to react quickly to market conditions leaves us very well placed to respond to changing economic circumstances. Therefore, despite the uncertainty surrounding the prospects for the global economy, we are confident of making further progress in 2008.”

APPENDICES


MONDI AT A GLANCE

Sales 2007 (1)

EBITDA margin

Products

Positions in Europe

€0.4B

South Africa

€0.6B

merchant /newsprint

€3.6B

No. 1 Kraft Paper(2)

No. 2 Kraftliner(2)

No. 1 Bag Converting(3)

No. 3 Corrugated Packaging

No. 1 Corrugated Packaging in SA(3)

No. 1 Rigid Plastics in SANo. 1 in Cartonboard in SA

No. 1 Newsprint in South Africa(2)

Leading Positions in Emerging Europe(4)

€1.9B

No. 1 Office Paper(2)

No. 2 UFP(2)

(1) Segment revenues, including inter-segment revenues. (2) Based on production capacity. (3) Based on sales. (4) Management estimate based on sales. Sources: RISI, Pöyry Forest Industry Consulting, Freedonia, BMI Foodpack, PAMSA, Mondi

14.0% 15.2% 12.6% 10.2%


ABRIDGED INCOME STATEMENT 1

1 Before special items


Group revenue 6,269 5,751 518 Materials, energy and consumables used (3,265) (2,960) (305)Variable selling expenses (558) (558) -Gross margin 2,446 2,233 213 Maintenance and other indirect expenses (289) (287) (2)Personnel costs (906) (874) (32)Other net operating expenses (381) (346) (35)EBITDA 870 726 144 Depreciation and amortisation (368) (349) (19)Operating profit from subsidiaries and joint ventures 502 377 125 Net income from associates 2 5 (3)Net finance charges (99) (77) (22)Profit before tax 405 305 100 Taxation charge (117) (115) (2)Profit for the financial period 288 190 98 Minority interests (47) (51) 4 Underlying earnings 241 139 102


EXPORT DEPENDENCYOverview of Export dependence European Paper Business

(Imports, Exports and Net Trade in % of Production)

Newsprint

21,5

-0,4

21,2

Uncoated Mechanical

23,5

-0,6

22,9

Coated Mechanical

8,6

-4,1

4,4

Uncoated Woodfree

27,1

-3,2

23,8

Coated Woodfree

6,6

-2,6

4,0

Sanitary and Household

9,0

-4,4

4,6

Container-board

29,0

-7,2

21,7

CartonBoards

24,4

-2,8

21,6

14,1

34,4

-7,4

27,0

WrappingsKraftpaper

Imports in % of ProductionNet Exports in % of Production

-9,3

4,9

Exports in % of Production

Note: CEPI covers Austria, Belgium, Czech Republic, Finland, France, Germany, Hungary, Italy, the Netherlands, Norway, Poland, Portugal, Slovak Republic, Spain, Sweden, Switzerland, United KingdomSource: CEPI European Pulp and Paper Industry Trade Statistics and Annual Statistics 2006; Cepifime for Uncoated Woodfree, Eurokraft/ Mondi Estimates for Kraftpaper)


PRODUCTION VOLUMES

2007 2006 % Change

Mondi PackagingContainerboard (tonnes) 2,101,363 2,044,391 + 3Kraft paper (tonnes) 891,385 850,271 + 5Corrugated board and boxes (m m2) 2,088 2,103 -1Industrial bags (m units) 3,642 3,606 + 1Coating and release liners (m m2) 2,971 2,360 + 26Pulp – external (tonnes) 179,059 180,166 -1

Mondi Business PaperUncoated fine paper (tonnes) 1,987,574 2,012,295 -1Newsprint 192,329 187,100 + 3Pulp – external (tonnes) 125,679 114,099 + 10Wood chips (bone dry tonnes) 690,447 886,612 -22

Mondi Packaging South AfricaPackaging papers (tonnes) 368,574 369,300 0Corrugated board and boxes (m m2) 367 328 + 12

Newsprint joint venturesNewsprint (attributable share) (tonnes) 314,847 320,876 -2


EXCHANGE RATES

Closing rates against the euro

South African rand 10.03 9.22 -8.8%Pounds sterling 0.73 0.67 -9.0%Polish zloty 3.59 3.84 6.5%Russian rouble 35.99 34.68 -3.8%Slovakian koruna 33.58 34.56 2.8%US dollar 1.47 1.32 -11.4%Czech koruna 26.63 27.50 3.2%

Average rates for the period against the euro

South African rand 9.66 8.51 -13.5%Pounds sterling 0.68 0.68 0.0%Polish zloty 3.78 3.90 3.1%Russian rouble 35.02 34.14 -2.6%Slovakian koruna 33.77 37.25 9.3%US dollar 1.37 1.26 -8.7%Czech koruna 27.76 28.37 2.2%

20062007 Change

MONDI GROUP RESULTS FOR THE YEAR ENDED 31 ......Group ROCE 3 up by 31% to 10.6% Final dividend of...

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