Mondi profit up on South Africa growth, uncoated fine paper

JOHANNESBURG, May 12 (Reuters) - Packaging and paper company Mondi (LSE: MNDI.L - news) said on Thursday first-quarter underlying profit rose 14 percent on strong performance from consumer packaging, uncoated fine paper and better sales in South Africa.

Underlying profit rose to 269 million euros ($307 million)from 236 million a year earlier, Mondi said in a statement.

Its packaging paper division, its biggest revenue generator, saw marginally higher selling prices. Its kraft paper unit, the common multi-purpose brown wrapping paper, saw improved demand from important export markets in Southeast Asia and the Middle East.

The South Africa division benefited from higher selling prices for uncoated fine paper, pulp and white-top kraftliner and currency gains.

Mondi said it had generated more cash from operating activities, resulting in a reduction in net debt during the quarter.

The company is investing about 450 million euros on capital projects in central Europe, its biggest market, and in South Africa to modernise mills and upgrade operations this year.

($1 = 0.8759 euros) (Reporting by Nqobile Dludla; editing by Jason Neely)