Augean lifts full-year expectations as landfill tax clash continues
By Josh White
Date: Wednesday 17 Jul 2019
(Sharecast News) - Waste management company Augean reported adjusted revenue before landfill tax of £44.2m for its first-half on Wednesday, rising 40% year-on-year.
The AIM-traded firm said its adjusted profit before tax was up 100% year-on-year for the six months ended 30 June, to £9.6m, while adjusted EBITDA advanced 71% to £14.2m.
Adjusted basic earnings per share were 114% higher at 7.61p.
During the period, the company received proceeds of £3.35m for the sale of East Kent, with the board reporting a net cash position of £22.8m at period end, up from £8.2m at the start of the six-month period.
On the operational front, the board said its business optimisation programme was delivered, with cost savings "considerably" exceeding its targets.
It said it saw good sales growth at all sites, with treatment and disposal up 39%, and North Sea ahead 43%.
Double digit growth was reported from residues from its energy from waste (EfW) operations, as well as other incinerators plants, despite delays in plant commissioning.
Strong further progress was demonstrated in the company's market position for soils, the board said, with overall volumes doubling on the first half of 2018.
It said it continued its diversification in the North Sea into industrial services, decommissioning and waste management, where it had secured new customer wins.
The group said it had received landfill tax assessments for its companies Augean North and Augean South for a total of £34.7m, or £37.3m including interest, adding that it expected to receive additional assessments for other time periods until the outcome of the Tax Tribunal was known .
All assessments had been appealed, with hardship awarded and no provision created, with Augean reporting that the Lower Tier Tax Tribunal was expected in 2020.
Augean said it remained confident that the group had met its landfill tax obligations.
Looking ahead, the firm said further growth was targeted in the core markets of energy from waste and North Sea decommissioning.
The board said it anticipated exceeding market expectations for the full year.
"The group has delivered strong results in all areas of the business with cash generation especially pleasing," said Augean executive chairman Jim Meredith.
"We remain confident in the group's prospects for a full year result and anticipate results ahead of market expectations."
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