Straight sunny despite stormy year
SEVERE wet weather has hit profits at recycling group Straight but it remains upbeat about the future with a strong order book for 2008.
Announcing its annual results today the Leeds-based group said that turnover for 2007 was £23.6m compared to £27.8m in 2006.
The group continues to be cash generative despite profits falling from £2m in 2006 to £0.6m for 2007.
The fall was blamed on reduced retail sales of water butts to the retail and gardening trade – 44% lower than the same period in 2006 when the UK enjoyed a long and dry summer.
Straight said its core trade business remained robust and had shown growth throughout the year which it described as “frustrating”.
On a more positive note the group's core trade business of waste and recycling saw sales increase by 2.6% to £19.2m.
Last week the group announced it had won tenders to supply £1.42m of equipment to seven local authorities in Wales.
The business will supply five different types of products for food and kitchen waste collection including its Kerbside Caddy which is made in the UK from recycled plastic.
The tender wins follow the Welsh Assembly's announcement it is providing £15m in grants to local authorities to boost food waste recycling across Wales and chief executive Jonathan Straight expects the group to receive a further chunk of that funding.
Mr Straight said that the business was keen to grow through acquisition.
He said: “We are talking to a number of businesses and discussions are at varying stages. We have identified four potential opportunities and we remain open minded.”
A number of new products are currently being developed by the group including containers for recycling in the workplace.
This year has also seen the launch of Steelybin – a metal waste and recycling container aimed at the trade and municipal markets – and it is hoped that the Wales contract win will be the first of many.
Mr Straight added: “There is no doubt that 2007 has been a difficult year for the group but we are very optimistic and we are very upbeat – this is the third time that the information has been in the public eye following the profits warning and it is water under the bridge. The future is very bright and we are cautiously optimistic in the current economic climate but if we can't do it nobody can.”
Chairman James Newman said: “The board strongly believes that the group has put the problems of 2007 behind it and is confident that 2008 will deliver an improved trading performance.”
The company has proposed a final dividend of 2p compared with 2.7p previously.
