According to spokespeople from Africa's largest paper and plastics packaging group, Mpact, the company is very positive about its prospects even as tough economic conditions weigh on consumer spending. After more than doubling its dividend in 2022, it is seeing continued tailwinds, including SA's strong fruit exports, as well the ongoing shift to home deliveries by increasingly environmentally conscious consumers.
Higher selling prices and strong demand helped operating profit rise almost a quarter in the group's year to end-December, with the company upping its dividend 130% to 115c per share, which is almost twice its 2019 payout.
Recent global supply chain disruptions had benefitted a company that generates almost 90% of its revenue in SA, CEO Bruce Strong told News24, with Mpact meeting some demand that would otherwise have been met by imports.
Strong demand from fruit exporters is expected to continue, and the company is spending R1.2 billion upgrading its mill in south east Mpumalanga to meet demand from exporters. This forms part of a focus on growth areas that will shield it from consumer spending, including convenience shopping, recycling, and waste management.
Valued at over R4 billion on the JSE, Mpact is the largest paper and plastics packaging and recycling business in Southern Africa with customers that include packaging converters, fruit producers and fast-moving consumer goods companies. At the end of December, the group employed 5,156 people and had 43 operating sites.