Mondi, the global paper and packaging group that operates in more than 30 countries, said Friday its operations in Russia represented 12 percent of its revenue by location of production in 2021.
Over the last three years, the business in Russia generated 20 percent of group underlying earnings before tax depreciation and amortisation - Mondi has operated in Russia for over 22 years.
The most significant facility was the pulp, packaging paper and uncoated fine paper mill located in Syktyvkar. The group also has three converting plants in Russia.
These facilities, which employ more than 5 300 people, primarily serve the domestic market and have continued to operate through the heightened geopolitical tension, the group said Friday.
In Ukraine, Mondi has a paper bag plant in Lviv, employing 100 people. Production is currently suspended.
The Syktyvkar mill does not receive direct funding from Mondi. It operates an integrated power plant providing a portion of the Komi Republic’s energy demand, and is the primary source of heat and warm water for the Syktyvkar Ezhva district, which has a population of 60 000 people.
It also provides other local community services such as waste water treatment. The mill is legally required by the Russian authorities to provide the energy supply.
Syktyvkar is currently operating, but the mill is starting to see a number of operational constraints, including in the importing of process chemicals, spare parts and other critical supplies.
“Recognising its corporate values and broader stakeholder responsibilities, the board is assessing all options for the group’s interests in Russia, including any form of legal separation.”
This does not mean, or imply, Mondi is planning, or initiating, any liquidation or bankruptcy proceedings in relation to any of its Russian subsidiaries or assets, the group said.
BUSINESS REPORT ONLINE