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8Joint Chair statementA culture that deliverssustainable growthThe Mondi Way is our framework forcreating sustainable value founded on ourthree core values of acting with integrity,being passionate about performance, andcaring about the world and each other.Our vision, which Peter Oswald expandson in his Chief Executive Officer’s letter,explains our future aspirations in line withour strategy.Chief Executive Officer’s letterPage 10-11Mondi WayPage 18-19We appreciate the trust our shareholdersplace in us to generate industry-leadingreturns, while contributing to society andminimising our impact on the environment.This includes supporting local communities;ensuring a safe, fair, diverse and inclusiveworking environment; and helpingemployees, customers and suppliers torealise their full potential.Acting with integrityThe boards of Mondi Limited and Mondiplc support the highest standards ofcorporate governance with a focus ontransparency, honesty and accountability.Our governance framework is designed toguide our behaviour in all areas of decisionmaking, keeping our culture and values atthe forefront when we consider how best toachieve our strategy. By acting with integritywe can balance our passion for performanceand our commitment to achieving long-termshareholder value with the diverse needs ofall our stakeholders.Our directors dedicate time to reviewingbest-practice developments, assessingperformance and optimising Mondi’sapproach. We regularly review ourgovernance framework and practices toensure they remain relevant, and we updatepolicies and procedures as required.We also consider the composition of theBoards and length of service of individualboard members to ensure an appropriatebalance of capabilities, business experience,independence and diversity. We are pleasedto welcome Stephen Young to the Boardsand as our new audit committee chair,he brings strong financial and generalmanagement experience, as well as anin-depth understanding of working for aninternational industrial business. We saidgoodbye to John Nicholas in May afteralmost nine years’ service. We thank Johnfor his significant contribution to Mondiduring this time, not least as chair of the auditcommittee, and we wish him all the best forthe future.Passion for performanceMondi’s strong track record of deliveringvalue accretive growth is achieved by ourrelentless focus on performance acrossour talented and hard-working teams; aportfolio of cost-advantaged assets makinga diverse range of high-quality products;and the integration of sustainability intoall business decisions. By building on theGroup’s inherent strengths we can takeadvantage of opportunities while mitigatingthe impact of risks.In June, a number of our board membersattended Mondi’s Leadership Forum,alongside senior leaders and MondiDiamond Awards finalists. This providedus with an invaluable opportunity to seeMondi’s leaders in action as participantsshared ideas, discussed strategic priorities toensure the Group’s long-term success, andcelebrated excellence in innovation throughthe Mondi Diamond Awards presentations.It gives us great confidence to know thatMondi’s future lies in the hands of this highlyprofessional and forward-thinking team.GovernancePage 84-143Investing in the future is the keyto creating long-term value.David Williams Joint Chair (left)Fred Phaswana Joint Chair (right)Mondi GroupIntegrated report and financial statements 2018

9Financial performancePage 64-67Underlying earnings per shareeuro cents189.1 eurocents%R1: 15r CAG5-yea137.820152016148.9107.32014201720181 Compound annual growth rateTotal ordinary dividend per shareeuro centscents76 euro762525742201420152016201720181 In addition to the 2017 ordinary dividend, a special dividend of100 euro cents was paid in 20182 Based on proposed final ordinary dividend of 54.55 euro centsper sharePeer performance range400Return Index3503002502001501005001 Jan201431 Dec201431 Dec2015Caring about peopleSafety remains our top priority and is a focusarea at every Board meeting. We are thereforedeeply saddened that two contractors losttheir lives while carrying out work for Mondi,one in 2018 at Syktyvkar (Russia) andthe second early in 2019 at Ružomberok(Slovakia). We also regret five life-alteringinjuries during the year. Our thoughts are withtheir families and colleagues. Importantly ourteams have worked hard to understand theevents leading to these incidents and howsimilar situations can be prevented in thefuture. We continue to strive for zero harm andpromote behaviour that ensures everyonereturns home safely to their families every day.We know that in order to be successful in thefuture, we need to unlock the full potentialof our people and nurture their passion.By treating people with care and respect, wecan promote a culture that encourages ourteams to be dynamic, entrepreneurial andempowered. This in turn helps Mondi to buildconstructive partnerships with stakeholders.Investing in the futureLooking forward, we expect the macroenvironment to remain uncertain, but overallour industry fundamentals are robust. With astrong balance sheet and industry-leadingmargins, Mondi has the potential to sustainits successful track record. Our approach isto focus on areas where we have the abilityto make a positive impact. This includesthe investment and business decisions wemake, how we interact with our stakeholders,and our commitment to creating value in asustainable way.Our Growing Responsibly model remains theframework through which we shape our longterm response to sustainability, and enablesus to demonstrate, monitor and improveour sustainability performance across thevalue chain.31 Dec201631 Dec201731 Dec2018The model covers 10 Action Areas andincludes 16 public commitments to beachieved by 2020, along with a carbonemissions commitment that runs to 2030.Sustainability performancePage 48-63Digitalisation is also a strong focus for Mondi.Our view is that by enhancing the way weuse technology, we can ensure that ourpeople have more time to focus on areasrequiring uniquely human skills. Mondi hasset out a digital roadmap and training is beingramped up to fast-track the digital expertise ofour teams.The Group has a strong major capitalexpenditure project pipeline. We successfullycommissioned the modernisation of the Štětímill (Czech Republic) towards the end of 2018,and continue to make good progress onmajor capital projects, including our innovativenew containerboard machine at Ružomberok.During the Boards’ visit to Świecie (Poland)we were impressed by the results of the 260 million capital investment programmecompleted in 2017. Mondi also completedthe acquisition of Powerflute (Finland), as wellas two industrial bag plants in Egypt, andwe continue to evaluate further acquisitionopportunities as they arise.Strategic performancePage 28-35On behalf of the Boards we thank all who havecontributed to Mondi’s excellent performancein 2018, showing integrity, passion andcommitment along the way. We have everyreason to believe that with our dynamicyet respectful approach, and passion forsustainable growth we will continue to deliverindustry-leading returns into the future.Fred PhaswanaJoint ChairDavid WilliamsJoint ChairMondi GroupIntegrated report and financial statements 2018Financial statements621Median of peer group450Governance133.7189.1Mondi plcStrategic report2018 was another strong year for Mondi.Underlying EBITDA was up 19% to 1,764 million (underlying EBITDA marginof 23.6%), profit before tax was up 25%to 1,105 million, and return on capitalemployed was 23.6%. The boards of MondiLimited and Mondi plc have recommendeda final ordinary dividend of 54.55 eurocents per share (2017: 42.90 euro cents pershare). Together with the interim ordinarydividend of 21.45 euro cents per share, thisamounts to a total ordinary dividend forthe year of 76.0 euro cents per share, anincrease of 23% from 2017.Five-year total shareholder return (TSR) of 74%(euro returns: indexed to 1 January 2014)OverviewTogether we have set the performancebar high. Over the last five years, Mondihas delivered a compound annual growthin basic underlying earnings per share of15%, with an industry leading return oncapital employed averaging 20.2% over thesame period. We remain confident in theGroup’s ability to deliver long-term valueto shareholders.

10Chief Executive Officer’s letterContributingto a better world2018 has been an exceptional year forMondi on a number of levels, not leastbecause we have delivered anotherstrong set of results. However, it will alsobe remembered as the year the spotlighton plastics and the challenges thrownup by our disposable society came intofocus – driven in part by a welcomesurge in media and consumer interest.The reaction by government and businesshas been extensive.The Mondi Way is our framework for creatingsustainable value, with our culture and valuesguiding the way we work. It’s important forour stakeholders to understand how Mondiis responding to the needs of our evolvingglobal society and the role we choose toplay in addressing the challenges. We havedefined our vision for the future to:eeContribute to a better worldeeBe an employer of choiceeeBe the global industry benchmark inquality, customer service, innovationand productivityThese are big ideas.Mondi WayPage 18-19Contributing to a better worldAt Mondi, we are pleased that the need forsustainable packaging has moved sharplyinto focus. We are uniquely positioned, asa manufacturer of paper, but also flexibleplastic packaging, to create the bestsolutions for forward-thinking consumerbrands in collaboration with sustainablematerials suppliers and recyclers.Our paper and flexible plastic packagingsolutions regularly win awards, butcommercial demand for some of our mostinnovative sustainable packaging was limitedbefore this year.Mondi GroupIntegrated report and financial statements 2018The public focus on the impact of plasticwaste is changing that. This momentumgives us an important opportunity to lead ourindustry with innovative sustainable paper andplastic packaging. By taking a holistic view,we can develop packaging that considersthe needs of customers, their products andthe planet.The development of a circular economy,which is restorative and regenerativeby design, requires deep collaboration.During 2018 we strengthened existingpartnerships and built new ones, for example:eeThrough the Ellen MacArthurFoundation’s New Plastics EconomyInitiative we’re working with partnersfrom across the value chain as part ofa Mondi-led pioneer project to innovatea new sustainable FMCG packagingsolution that will prove the concept ofdesign for recycling.eeWe continue to contribute as a member ofthe WBCSD’s Forest Solutions Group andas WWF International’s corporate partnerin the paper and packaging industry.In 2018 our Consumer Packaging andFibre Packaging business units increasedtheir collaborative efforts to fast-track thedevelopment of EcoSolutions with a focus on:eereplacing plastic packaging withrenewable fibre-based paper packaging,e.g. EcoVantage shopper bags andEcoComp food waste bags;eereplacing rigid plastic packaging withflexible plastic packaging, typicallyreducing plastic consumption by 70%;andeeoptimising plastic packaging for recycling,e.g. BarrierPack Recyclable and theFrosch pouch – both 100% recyclable.Business review: Consumer PackagingPage 76-79Another key focus area is our commitment tofighting climate change. Our aim is to reduceemissions, improve energy efficiency andreplace fossil fuels with renewable biomassbased energy, where it is practical andeconomically feasible. We combine strategicenergy-related investments across our pulpand paper mills with good managementand sharing of best practice. For example,over the past 10 years Mondi has investedin five new highly efficient recovery boilersat Frantschach (Austria), Ružomberok(Slovakia), Štětí (Czech Republic), Świecie(Poland), and Syktyvkar (Russia), as well asbiomass boilers at Syktyvkar and Świecie.As a group, we have reduced our specificCO2e emissions by 38% since 2004 and64% of Mondi’s pulp and paper mills’fuel consumption came from renewablebiomass-based sources in 2018.Sustainability performancePage 48-63Being an employer of choiceOur primary responsibility as an employer ofchoice must be the safety of our employees.We have made significant progress in recentyears in our goal to zero harm, but 2018started tragically with the death of a contractorin Syktyvkar and the year saw five incidentsleading to life-altering injuries. Unfortunately wesuffered another fatality in January 2019during drilling works at the construction siteof our new paper machine in Ružomberok.Our deepest condolences have beenextended to family members and colleagues.There isn’t a single solution to this, but zeroharm remains our first priority and we haveplans in place to address the challenge.We are proud of our passion for performance,and as CEO I am more determined than everto make this a passion for safe performance.

11OverviewMondi’s focus on key global industrytrends in sustainability, digitalisationand empowering brands continuesto drive value accretive growth.Peter OswaldChief Executive OfficerWe completed the acquisition of Powerflutein Finland and two industrial bag plantsin Egypt. Over the past five years wehave completed a limited number ofsmaller acquisitions as we struggled tomeet sellers’ expectations on valuation.Looking forward, with our strong financialposition and depth of managementresources, we are well placed to moveshould the right assets become available atreasonable values.Mondi has a strong track record ofoperational performance and comprehensiveprogrammes to eliminate costs. Goingforward we believe that digitalisation will playan important role. We have been pilotingprojects that will accelerate our digitaljourney and identify the best way to harnesstechnology: data science and advancedanalytics will help us to improve productivityand lower costs, and be key to connectingbetter with our customers. Technology canmake us efficient, but it’s our employees thatmake us smart!Strategic performancePage 28-35I am confident that Mondi’s focus on keyglobal industry trends in sustainability,digitalisation and enhancing brand value willcontinue to drive growth. Geographically weremain well-placed for opportunities inEurope and North America, which accountfor around half the global packagingmarket. Our leading position in centraland eastern European markets, as well asexposure to growing markets in Africa andAsia also provide strong opportunities forour continued growth.While we cannot predict the impact ofthe current heightened geo-politicaland macro-economic uncertainties, ourindustry leading margins and strong cashgeneration, coupled with a strong balancesheet make us resilient and provide uswith the strategic flexibility to exploitopportunities as and when they arise.Our proposal to simplify our dual listedstructure into a single holding companystructure under Mondi plc will, subject toshareholder approval, simplify cash anddividend flows; enhance our strategicflexibility; increase transparency; andremove the complexity associated with thecurrent structure.With our robust business model andintegrated value chain, strong costmanagement, and focus on partnering withour customers to deliver innovative andsustainable solutions, I am convinced weare well positioned for the future.Overall 2018 was a year of strong progressfor Mondi across all fronts. At the heart ofthis success is our people and it is to themthat I extend my thanks, for their passion,their innovation and their commitment.Peter OswaldChief Executive OfficerMondi GroupIntegrated report and financial statements 2018Financial statementsBusiness reviewsPage 68-83We intend to set the standard for customerservice, innovation, quality, and productivity.This means delivering excellence acrossall our work streams and there were manypositive milestones in 2018. We havealso seen strong progress on our capitalexpenditure projects, in particular themodernisation of our Štětí mill and ourplanned new kraft top white machinein Ružomberok.Driving future growthGovernanceLeading with our hearts and minds,combined with clear strategic directionis the key to our ongoing success. So, inaddition to our regular interactions, Mondi’ssenior leaders come together every fewyears for our Leadership Forum – in 2018we met in the energetic city of Berlin.The goal was to align around the prioritiesfor Mondi’s growth journey – with inspiringleadership and employee engagement.It is where we launched our vision for thefuture, and celebrated excellence with theculmination of the Mondi Diamond Awards.Our 12 finalists presented their projects inperson, showcasing the very best of Mondiout of a diverse and impressive range of100 entries from across the world.Global industry benchmark –delivering excellenceStrategic reportLow unemployment in many of our coremarkets and changing aspirations ofmillennials means we have to be smartand responsive in attracting and retainingthe talent we need to achieve our businessambitions. In 2018 we held our first globalDiversity & Inclusion conference, fromwhich we created targeted plans acrossMondi. Gender diversity is important, butso are age, ethnicity and all other formsof diversity. We have made progress inbroadening representation in some areas,but at the heart of our ambition is thecreation of an environment where all voicesare heard and new ideas rise quickly tothe surface. At Mondi, we recognise thatleading for innovation requires a differentapproach to leading for change, and weneed the skills and agility to do both. I lookforward to communicating our progressin 2019.

12StrategicreportExternal context 14Financial performance 64Our business model 18Business reviews 68Our strategy and strategic performance 26Fibre Packaging Key performance indicators 36Consumer Packaging 76Principal risks 38Uncoated Fine Paper 80Sustainability performance 48The Strategic report was approved by the Boardson 27 February 2019 and is signed on their behalf by:Peter OswaldChief Executive Of

packaging from traditional boxes to fully customised multi-piece solutions, appealing point-of-sale displays and heavy-duty shipping containers. As the global leader in sack kraft paper and industrial bags, we create strong, light-weight and sustainable products for cement and building materials, agricultural, chemical and food products.