S.Africa's Mondi says Q3 profit up almost 30 pct

JOHANNESBURG, Oct (HKSE: 3366-OL.HK - news) 8 (Reuters) - Packaging and paper company Mondi (LSE: MNDI.L - news) said on Thursday third quarter underlying profit rose 27 percent thanks to higher prices and better sales in most of its business units.

Underlying profit reached 221 million euros ($250 million) from 174 million euros in the same period last year, Mondi said in a statement.

Its packaging paper division, which is its biggest revenue generator, saw higher selling prices. Its kraft paper unit, the common multi-purpose brown wrapping paper, saw a slight dip in demand from some of its export markets partly due to political instability in the Middle East and north Africa.

The company had generated more cash which allowed it to lower its net debt with plans to further reduce leveraging by the end of the year, Chief Executive David Hathorn said in a conference call.

Capital (Other OTC: CGHC - news) investments projects are expected to contribute 50 million euros towards 2015 underlying profits, it said. Hathorn said all projects were completed in line with budget and timeline.

About 420 million euros is currently being spent on capital projects to modernise mills and upgrade operations this year and in 2016 and is expected to generate 20 percent return.

($1 = 0.8850 euros) (Reporting by Zandi Shabalala; Editing by Keith Weir)