Robust performance in difficult conditions for waste management firm
Wetherby-based listed waste management business says the pandemic had a negative impact on almost all sections of its operation.
The company has today released its unaudited interim results for the six months ended 30 June 2020.
The most heavily impacted parts of its operation include radioactive, biomass Energy from Waste and construction which were all placed on hold due to lockdown restrictions.
The North Sea service business was hit hard by both the Covid-19 effect on activity levels, as well as by an “unprecedented significant decline” in the oil price as a result of Covid-19.
Augean’s adjusted revenue before landfill tax decreased by 6% to £41.4m (2019: £44.2m), while adjusted pre-tax profits fell 11% to £8.5m (2019: £9.6m).
Adjusted EBITDA declined by 6% to £13.3m (2019: £14.2m)
The business saw sales growth of 14% in the North Sea, due to successful completion of the Curlew decommissioning contract. But its Treatment & Disposal sales fell by 16%.
As announced on 10 December 2019, the Group paid £40.4m to HMRC to clear all outstanding landfill tax assessments.
The first hearing of its appeal against the assessments at a Tax Tribunal will take place at the end of September 2020
Augean filed claims for repayment of overpaid landfill tax in relation to engineering material used in the Group’s landfill of £11.1m in May.
In its outlook statement, Augean says it is targeting further growth in the core market of Energy from Waste and expects a second half pick up in construction soils.
It adds: “We expect a tough market for North Sea Services with no new significant decommissioning project expected in 2020.
“Full year 2020 profit is expected to be more weighted to the second half than would be typical.”
Jim Meredith, executive chairman, said: “The Group has delivered a robust performance across all areas of the business despite significant headwinds in quarter two.
“We are working hard to recoup the impact of the lower oil price and Covid-19 over the second half and, assuming no further Covid-19 lockdowns, we anticipate that full year results will be broadly in line with market expectations.
“The Group’s performance in difficult circumstances (Covid-19 and oil price reduction) demonstrated the resilience of our current portfolio of activities and so maintaining our growth profile.”
