Profits boost at Augean despite change period

HAZARDOUS waste company Augean has seen its profits grow as its strategy of placing more emphahsis on the treatment of waste rather than landfill comes to fruition.

The Wetherby-based group today said pre-tax profit for the year to December 31 was £3.8m, up 8% on the previous year. Revenues, exlcuding landfill tax, increased by 5% from £21.4m to £22.6m. Revenues were flat with landfill tax included.

Operating profit before exceptional items increased by 8% to £4.9m.

It has been a period of change for the group. Present chief executive, Paul Blackler, is the third man to hold the position in the last 18 months following his promotion from commercial director.

Mr Blackler said: “Augean has been developing its business strategy over the past three years to position the group to be capable of rewarding its shareholders with strong, predictable performance in the environmental sector strategically secured by being closely aligned to the objectives of the Government's waste aims and policies.”

Mr Blackler said that the Government's updated waste strategy placed Augean in a strong position as it was “one of only a relatively small number of businesses that has sought and received approval for permissions to construct a modern waste infrastructure in line with the government's core waste objectives”.

The group submitted a planning application in September to construct the UK's largest single site waste facility in the UK at Port Clarence.

Augean has been active in the acquisitions market over the past year. The group acquired rival Hitech Equipment for £6m last December to increase its exposure to the hazardous waste treatment, recycling and recovery sectors.

Hitech operates from two strategic locations with a two-acre hazardous waste treatment and recycling facility in Paisley, Glasgow, and a specialist industrial services operation in Ellesmere Port in the North West.

Augean also bought RNA Investments and its trading subsidiary Chemical Recoveries (Chemrec), which has a site in Avonmouth specialising in the recycling and recovery of contaminated industrial solvents, sludges, oils and wastewaters, for a cash consideration of £5.8m.

The group's chairman, David Williams, said Augean was well placed to develop further opportunities for acquisitive growth .

Mr Williams said: “We have been active on the acquisition front during the year as we have moved the business further into the treatment market.

“Despite the acquisition activity, good cash flow has meant we are still only modestly geared and therefore in a good position to take advantage of any further deals that could be appropriate for us.”

He added that the evolution of the hazardous waste market had meant Augean was now concentrating more on the treatment of waste.

However, Mr Blackler said short-term performance had been hit because of issues including the decrease in remediation projects over the wet summer, which affected Augean's landfill division.

He said the treatment division also had a “mixed year” because of the management changes at the group and also because of regulatory difficulties.

Augean said its join venture soil treatment operation, Terramundo near Middlesbrough, had also had an encouraging start.