24th May 2022 12:19
(Alliance News) - Renewi PLC on Tuesday posted a higher annual profit as it announced the acquisition of Dutch recycling business GMP Exploitatie BV, or Paro, from GMP Groep BV.
Renewi's pretax profit in the year ended March 31 surged to EUR95.7 million from EUR10.9 million. Revenue grew 10% to EUR1.87 billion from EUR1.69 billion.
"Our end markets have continued to grow, with climate-driven legislation and corporate strategies supporting increased recycling and demand for high quality secondary materials which, in turn, is driving a sustained increase in recyclate prices," explained Chief Executive Officer Otto de Bont.
Its commercial division, which represents over 70% of its revenue, has been able to control costs through "appropriate price increases reflecting wider inflationary pressures," the company said.
The firm's board is not recommending a dividend for financial 2022, however it will keep its dividend policy under review for financial 2023, it added.
Meanwhile, the Milton Keynes, England-based waste management company expects its performance for financial 2023 to top prior expectations.
"We expect prices to stabilise above pre-Covid levels for the medium term, reflecting the structural growth of the circular economy," it said.
It also announced the EUR67 million acquisition of Amsterdam-based commercial waste and recycling business GMP Exploitatie, trading as Paro, from GMP Groep. It is Renewi's first major acquisition since it was created in 2017, Renewi CEO de Bont said.
The firm expects its acquisition to be profitable and to deliver operational benefits such as optimising route and waste flow.
Renewi shares were 9.4% higher at 708.00 pence each in London on Tuesday midday.
By Tom Budszus; [email protected]
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